NAO - National Audit Office

03/12/2025 | Press release | Distributed by Public on 03/11/2025 19:35

DBT’s approach to supporting UK industry needs boost to unlock full potential of Industrial Strategy

  • The Department for Business and Trade (DBT) should use the clear framework for prioritisation in the forthcoming Industrial Strategy to review how it supports key industry sectors.
  • DBT has developed its approach to supporting industry sectors since it formed in 2023, but there are areas to improve.
  • Issues identified include a limited view of overall government spending on business support; a lack of transparency when making decisions to support industry; and difficulty in influencing other departments to change policy.

Weaknesses in how the Department for Business and Trade (DBT) supports UK industries must be addressed if government is to maximise the impact of its forthcoming Industrial Strategy and achieve its priority mission of growing the economy, according to a new National Audit Office (NAO) report.1,2,3

In support of this priority, government announced a new Industrial Strategy in October 2024 and identified eight growth-driving sectors that can boost output and productivity growth over the long term.4,5 DBT's role is to support businesses, including those operating in these priority sectors, to invest, grow and export, creating jobs and opportunities across the country.

In the two years since it formed, DBT has done well to merge structures and teams from the former Department for Business, Energy and Industrial Strategy (BEIS) and Department for International Trade (DIT) and address its immediate skills gaps. It has engaged extensively with industry stakeholders to understand their needs and developed sector plans using its knowledge of the economy. It also shares its business intelligence widely across government.

However, DBT does not have a complete overview of what it and wider government spends supporting industry - hindering its ability to make sound decisions in the future and allocate resources strategically.

To date, DBT has not looked at its industry sector strategies collectively, with limited consideration of the trade-offs between different business support decisions and different sectors. This can make it difficult for stakeholders to understand DBT's decision making, and for DBT to demonstrate how and why it is prioritising certain decisions over others. DBT also makes too little use of evidence of what works to inform its approach to developing new industry support initiatives.

Despite government's 'mission-driven' approach and its stated aim to encourage cross-departmental ways of working, DBT is not always able to exert influence over other departments to achieve policy change that supports business.

And while DBT has taken steps to improve how it collaborates with other departments, a lack of clarity has caused frustration among some businesses regarding which department can best support their needs.

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 that drive growth in the priority sectors and across the whole economy.

The NAO recommends that DBT uses the forthcoming Industrial Strategy to review its operating model for supporting key industry sectors.

It should also clarify the metrics it uses, and the trade-offs it makes, when prioritising certain business support decisions over others; consider how it can collate its spending to support business in a more useful way; lean more heavily on evidence when making such decisions; and develop its approach to monitoring and evaluation to understand what works.

"DBT was created to provide a 'front door' to the UK's key industries, supporting government's priority mission of growing the economy.

"It has made early headway, and now needs to build on its approach to supporting industry and make transparent, informed decisions about where best to deploy its resources."

Gareth Davies, head of the NAO

Read the full report

Supporting the UK's priority industry sectors

Notes for editors

  1. The report can be accessed here: https://www.nao.org.uk/reports/supporting-the-uks-priority-industry-sectors/
  2. DBT was formed in February 2023. It brought together the relevant functions from the former BEIS and the former DIT into one department for economic growth.
  3. The government is focusing on five national 'missions', with economic growth the priority mission.
  4. The Secretary of State for Business and Trade and the Chancellor of the Exchequer announced the Industrial Strategy in October 2024 and published a green paper for consultation: Invest 2035: the UK's modern industrial strategy. According to the green paper, the Industrial Strategy is expected to be published in late Spring 2025 alongside the government's multi-year spending review.
  5. The eight growth-driving sectors are: advanced manufacturing; creative industries; clean energy industries; defence; digital and technologies; financial services; life sciences; and professional and business services.