THE BATTLE FOR GKN
Melrose boss: We’re NOT a threat to security
THE dramatic takeover battle for GKN has succeeded in one thing: it has turned a muchneeded spotlight on this country’s industrial sector. I find it hard to see the transfer of ownership to Melrose as a national tragedy. Quite the opposite – it could be a good thing for GKN, whose self-image as a Spitfire-making British stalwart was somewhat undermined by its plans to strip its own assets and sell a division to the Americans.
The Melrose crew may be hardheaded, but they have delivered impressive results. Unlike the GKN board, few doubt their abilities. In any event, there are issues here that stretch way beyond the fate of one company.
The ownership of GKN is important, but it is only a relatively small part of a much bigger question: how are we going to fashion our industrial future post-Brexit? Melrose, inadvertently no doubt, has put GKN, and by extension Britain’s wider manufacturing sector, at the top of politicians’ agenda and if it makes them stop and think, so much the better.
‘We made the world’ – that’s the unofficial motto of Teesside, my home, and it always brings a bit of a lump to my throat. The uncomfortable reality though, is that Britain no longer prides itself as much as we should on being a great manufacturing nation.
The assumption is that our prosperity depends largely on financial services, shopping and airy new online or ‘creative’ businesses. The stereotype remains that industry is dirty, old-fashioned and more efficiently performed in emerging economies, leaving regions like Teesside doomed to be permanent wastelands. That’s the myth – the reality is that manufacturing does matter, hugely. It’s true that the sector is smaller than in its heyday, but the UK is still the eighth largest industrial nation. Manufacturing accounts for 2.6 million jobs and 44 per cent of exports.
We are told that GKN made tanks in the Second World War, cannon balls for the Napoleonic wars and track for Brunel’s Great Western Railways. Well, it might have made the pitchforks for the Peasants’ Revolt, but that was then, this is now.
Within the manufacturing sector, everyone is obsessed with ‘4IR’ or the Fourth Industrial Revolution – the technologies that will bring new smart drugs, intelligent robots, driverless cars and the ‘internet of things’.
The real question is whether Britain can produce enough talent to succeed as we did in the first Industrial Revolution – whether we can nurture the Brunels and the Stephensons of the 21st Century.
Are our universities providing the right training, and transforming brilliant ideas into commercial propositions? Are we supporting enough young people into apprenticeships? Clue: figures last week revealed that there has been a 25 per cent fall in the take-up of apprenticeships since a new levy was introduced a year ago. But you probably missed it, reading about GKN.
Critics of Melrose accused it of short-termism and if so, it is in good company because it’s a national disease. The UK invests only 1.7 per cent of GDP in research and development, well below our major competitors.
As for the politicians who have waded in, the Conservative Party has historically had an ambivalent attitude to industry. Theresa May, unlike recent predecessors, actually has an industrial strategy – shame that so few people have even noticed. Turning to the Labour figures so noisily demanding GKN be ‘saved’, more than a million manufacturing jobs were lost under the Blair/Brown administrations.
Do manufacturing firms need protection from predators? Maybe, but not as much as they need decent infrastructure and transport links. Not as much as they need genuine respect and understanding from government.
And certainly not as much as they need to mend the dire skills shortage which is likely to become more acute after Brexit.
Melrose has put manufacturing at the top of the political agenda