What does the budget mean for the logistics sector?
Labour’s first budget confirmed the Government’s intention to invest in gigafactories with the budget report acknowledging that building new network infrastructure is key to delivering growth of data centres.
In her budget Rachel Reeves also confirmed the Government’s aim to drive forward its industrial strategy - in October the Government published “Invest 2035”, a green paper which seeks views on a proposed 10 year industrial strategy.
The draft strategy sets out a number of proposals including:
- establishing a statutory Industrial Strategy Council (to ensure that the Government’s industrial plans are enshrined for the long term),
- aligning with Net Zero targets and the Clean Energy mission,
- reducing supply-chain vulnerabilities, and
- accelerating innovation.
The strategy’s overarching aim is to encourage growth in eight key sectors (identified as the UK’s current and emerging strengths) being:
- Advanced Manufacturing,
- Clean Energy Industries,
- Creative Industries,
- Defence,
- Digital and Technologies,
- Financial Services,
- Life Sciences, and
- Professional and Business Services.
Further sub-sectors are to be identified in due course, with the Government seeking views from stakeholders on the most important sub-sectors for growth.
The strategy acknowledges that additional data centre capacity is fundamental for economic growth, whilst also recognizing the importance of strong supply chain linkages between sectors. It is encouraging that the logistics sector is at the forefront of the Government’s attention – but time well tell as to what steps are taken to properly promote this agenda.
The Government is aiming to collect views on its draft strategy (for example, on what are the key planning barriers to such sectors) before publishing the final version in Spring 2025.
"Accelerating grid connections and building new network infrastructure is central to ... delivering growth"
