The National Audit Office (NAO), has taken a look at whether the Department for Business and Trade (DBT), is well prepared to deliver the government’s new industrial strategy. This isn’t a document which looks directly at universities but there are some familiar lessons.

Before diving into the lacuna of organisations, their policies, and what they’re up to, let’s quickly remind ourselves of how DBT came into existence and what it is meant to do.

Under the Conservative government the functions of DBT, the Department for Energy Security and Net Zero (DESNZ), and the Department for Science, Innovation and Technology (DSIT), existed under a super department the Department for Business, Energy, and Industrial Strategy (BEIS). This arrangement existed until 2023 when the DBT came into existence. They describe themselves as “[…] the department for economic growth. We support businesses to invest, grow and export, creating jobs and opportunities across the country.”

DBT is the key body that aligns the government’s missions, the things they say they will do to improve the economy, and the industrial strategy, their plan to support growth sectors in order to make the economy bigger. Therefore, the proper functioning of DBT is central to the government’s economic plans, and if universities are in the game of supporting economic growth they need a DBT that works.

It’s too early to assess whether DBT is effective but NAO has looked at whether DBT is clear about what it’s doing and whether it has the structures in place to do it.

One of the criticisms that universities have had of previous government policy is that it changes too often. There have been a litany of moonshots, growth plans, and frameworks, and the current government with its mixture of missions, foundations, and priorities for growth risks making a similar error. Comfortingly, the NAO sees a potential in DBT as being a force which can use its institutional knowledge to bring together disparate plans.

Less warmly there is clearly a risk, as with any new body, that in trying to deliver everything there is a clear lack of priorities. NAO acknowledges that the industrial strategy covers around £1tn of economic activity. However, it not clear how DBT is balancing different growth imperatives which can

[…]make it difficult for stakeholders to understand the rationale behind support, and for DBT to evaluate the effectiveness of its portfolio of initiatives as a whole and demonstrate how and why it is prioritising certain interventions over others.

Again, this feels similar to some of the government policy challenges the sector is familiar with. If universities can’t understand which priorities it can support, on what basis, and to the most effect, they will simply keep doing the things they have always done. This challenge appears again in another format with “DBT treats each sector individually, with limited consideration of the trade-offs and interdependencies between different interventions and different sectors.”

This is clearly a big challenge for universities whose work rarely fits clearly within neat economic outputs. For example, work on the building and funding of renewable energies likely covers advanced manufacturing, clean energy, financial service, professional and business services, and digital and technologies, all at once. If the aim is to grow the economy in line with government aims the sector needs fewer front doors, fewer decision makers, and a clear direction.

And it is this cross-collaboration which will ultimately be key to the success of DBT. As the NAO note:

The success of the Industrial Strategy will depend on whether DBT and other government departments can work effectively together, and with industry, to prioritise and target interventions to drive the desired economic growth in the priority sectors, and across the whole economy.

It would clearly be less than ideal if the Department for Education was promoting a skills policy which did not meet the needs of the identified growth sectors. There is encouragement that there are “handshake” agreements in place between government departments but there is an underlying sense that there needs to be more clarity. As the report notes

DBT has found it challenging to influence DfE to support industry through skills policy. Since the formation of DBT a more collaborative relationship with DfE has emerged. DBT has shared its assessment of skills requirements, and the departments meet regularly, but there is no formal working arrangement to progress DBT’s requests. DBT therefore must wait for the publication of Skills England’s strategy to understand how sectors of the economy may be affected by skills policy, and what potential trade-offs will need to be considered between the departments’ objectives.

Ultimately, this report forces the question whether the government imagines the industrial strategy to be the framework through which every other economic decision is made from research to skills policy, or whether the industrial strategy is one economic strategy amongst many which loosely attempts to corral constituent ideas on place, growth, regeneration, skills, education, research investment, and exports, into more than the sum of their parts.

The NAO has looked at DBT but in doing so uncovers a wider truth ahead of the finalisation of the industrial strategy. Universities will respond to the incentives put in front of them but they must be clear, predictable, and easy to navigate.