Written questions by Byrne.

What role her Department’s Enterprise and Growth Unit will have in supporting (a) the Government’s Growth Mission and (b) the Spending Review next year.

The growth mission is the government’s central mission. The Enterprise and Growth Unit plays a key role in driving the mission forward. It is focused on policy development, in partnership with business, industry and other stakeholders, across the seven growth mission pillars outlined at the Autumn Budget. It works closely with other groups within HM Treasury, for example the International and Financial Services Groups and the new Growth Delivery Unit which is focused on delivery. At the Spending Review, the Enterprise and Growth Unit is responsible for spending control for several departments and will work closely with departments to ensure spending plans are affordable and support the government’s missions.

What estimate she has made of how many economically inactive people will rejoin the workforce as a result of the measures announced in the Get Britain Working White Paper.

The trend of economic inactivity is a long-term challenge; the UK is the only country in the G7 with an inactivity rate higher than before the pandemic. Building a thriving labour market, reducing economic inactivity and increasing the number of people in work is central to growing the economy. Fundamental reforms announced in the Get Britain Working white paper will help us achieve the bold, long-term ambition of an 80% employment rate, meaning over two million more people in work and the UK as one of the top performing labour markets in the OECD. Backed by £240m of funding announced in the Budget, the White Paper sets out ambitious reform outlined in three interconnected parts:a new jobs and careers service, bringing Jobcentre Plus together with the National Careers Service in England. This new service will support more people into work and help them get on in work, including through an enhanced focus on skills and careers, and will be kickstarted by an initial £55m of funding for tests and trials next year. It will be open to all, helping the 890,000 people who have left the workforce since the pandemic and the 1.9 million who may wish to join it, back into the labour market.a new Youth Guarantee for all 18-21 year olds in England, to ensure they have an offer of education, training or help to find work. This is backed by £45m in funding for trailblazers across eight mayoral authorities in England starting next year to help bring the 946,000 young people not in education, employment or training back into the workforce.£15m to support the development of local Get Britain Working plans for areas across England. These plans will set out how economic inactivity will be tackled at a local level, led by Mayors and local areas. An additional £125m will fund eight trailblazers across England and Wales to tackle economic inactivity through increased engagement and tailored approaches because we know that one size does not fit all and inactivity rates vary between areas, with the North East at 26.8% and the South West at 17.9%.

What steps his Department plan to take to ensure value for money from the £3.9 billion of funding allocated for carbon capture and storage and green hydrogen in 2025-26.

A formal part of the policy design and delivery process involves reviewing prior relevant efforts to ensure government is maximising value for money wherever possible. Our value for money judgement is evidenced by appraisal and analysis developed in line with the HMT Green Book and has supported policy development at each stage of the CCUS programme and the first Hydrogen Allocation Round (HAR1). All future carbon capture build out projects and subsequent HARs will require approved business cases, which will contain robust value for money assessments. The business models supporting both CCUS and electrolytic ‘green’ hydrogen are designed to address the risks that currently are a barrier to first of a kind projects, incentivise project behaviour in line with government objectives and deliver value for money for consumers and taxpayers.

What assessment she has made of the potential impact of the planned £20.4 billion of research and development spending on (a) economic growth, (b) the national investment rate and (c) crowding in of private investment.

At Autumn Budget 2024, the government protected R&D by allocating £20.4bn to support its missions, including the growth mission. Recent Department for Science, Innovation and Technology published research has found an average rate of return to public R&D of 40% after 6 years from when the investment is made [1]. The government’s investment will also boost business investment in R&D. Although estimates of the impact on private investment vary, on average £1 of public R&D investment leverages around £2 of private R&D investment in the long run [2]. The Office for Budget Responsibility is responsible for modelling the impact of government policy on the economy.[1] Returns to Public Research and Development - GOV.UK[2] Research and development: relationship between public and private funding - GOV.UK

With refence to section 1.3 2. of his policy paper entitled The Atlantic Declaration, updated on 21 June 2023, what progress he has made on establishing an outbound investment mechanism.

The Department for Business and Trade is keeping the potential national security risk posed by outward direct investment in sensitive sectors under review, and continuing to engage with businesses and financial stakeholders on this issue. In May, the Cabinet Office issued public guidance on how the existing National Security and Investment Act powers allow the Government to intervene in certain outward direct investment transactions.

With reference to the written statement of 18 April 2024 on Economic Security, HCWS415, if he will make an assessment of the potential merits of targeted exemptions from the mandatory notification requirements of the National Security and Investment Act 2021.

The National Security and Investment (NSI) Act has an important role to play in ensuring businesses in the UK can thrive and access vital investment without compromising our national security. We are therefore considering the responses to the previous Government’s Call for Evidence and reflecting on our own experiences of making decisions in the NSI system over the past six months.

What estimate his Department has made of the amount of private investment that will be raised for carbon capture and storage and hydrogen projects by the £3.9 billion of public funding announced in paragraph 3.52 of the Autumn Budget 2024.

On 4th October, the government reached commercial agreement with the private sector and announced up to £21.7bn of available funding over 25 years to launch the UK’s new carbon capture, usage and storage industry. We expect this funding to crowd in £8bn in private sector investment for the 25 years, and demonstrating the investability of CCUS will unlock a further pipeline of billions of pounds in private sector investment. It is estimated that industry has spent £1 billion in investment already. The government also announced over £2bn of funding over 15 years for the projects in the first Hydrogen Allocation Round (HAR1). These projects will invest over £400m of private capital during construction across the UK.

What assessment he has made of the potential impact of defence spending on (a) economic growth and (b) regional growth in each of the next five years.

The Government is bringing forward a Defence Industrial Strategy that aligns our security and economic priorities. The strategic aim of the Defence Industrial Strategy is to make sure the imperatives of national security and a high-growth economy are addressed. Defence has a key role to play in delivering the Government's Growth Mission, by setting the conditions necessary for economic growth and by growing a better, more integrated, more innovative, and more resilient defence sector. An important part of this work is understanding and developing the impact defence spending has on the nations and regions of the UK.

With reference paragraph 4.51 of the Autumn Budget 2024, what his Department's priorities are for the planned £20 billion spending with UK industry in 2025-26.

Funding for the Ministry of Defence for financial year 2025-26 has not yet been allocated to specific programmes or activities. The Department is still in the process of setting budgets internally.

What steps his Department plans to take to maximise the value for money from public funding for the steel industry over the next five years.

The Government is developing a steel strategy, in partnership with the steel sector and trade unions, that will set out a long-term vision for steel and create opportunities for public and private investment.We have committed to providing up to £2.5bn for steel which will be available through the National Wealth Fund and other routes. This is in addition to the £500m for Tata at Port Talbot steelworks. When designing how best to invest this money, we will consider a range of factors, including leveraging private sector investment and making the UK a great place to invest.

What estimate his Department has made of the potential impact of public funding for the steel industry on levels of private-sector investment in that industry in each of the next five years.

The Government is developing a steel strategy, in partnership with the steel sector and trade unions, that will set out a long-term vision for steel and create opportunities for public and private investment.We have committed to providing up to £2.5bn for steel which will be available through the National Wealth Fund and other routes. This is in addition to the £500m for Tata at Port Talbot steelworks. When designing how best to invest this money, we will consider a range of factors, including leveraging private sector investment and making the UK a great place to invest.

Pursuant to the answer of 4 November 2024 to Question 11837 on Integrated Security, Defence, Development and Foreign Policy Review, what plans he has to (a) engage and (b) inform Parliament on each review.

In relation to my answer of 4 November 2024 to Question 11837, decisions about parliamentary engagement are matters for the relevant department owners of each review. The Chancellor of the Duchy of Lancaster committed to a review of UK national resilience in his statement to the House of Commons on 19 July, in response to the Covid-19 Inquiry’s Module 1 report. The review is expected to conclude in Spring 2025 and includes a broad programme of engagement, including Parliamentary, to ensure the UK Government’s approach to resilience best helps mitigate the challenges we face. The review will also consider the future approach to reporting on and scrutiny of UK national resilience.

Pursuant to the Answer of 4 November 2024 to Question 11837 on Integrated Security, Defence, Development and Foreign Policy Review, if he will set out for each review (a) the planned timeline for completion and (b) whether the findings will be published.

In relation to my answer of 4 November 2024 to Question 11837, the aforementioned reviews are scheduled to conclude in the first half of 2025. Decisions about publication and consultation are matters for the relevant department owners. The Cabinet Office owns the resilience review which will conclude in Spring 2025 and will set the future direction for the resilience system. It is an internally-led review which will draw on existing evidence to inform what is working well and what could change, including the findings from the Covid-19 Inquiry Module 1 and the Grenfell Inquiry. In addition to regular discussions with stakeholders, Ministers and officials are continuing to meet with those from devolved, regional and local Government, businesses and civil society.

Pursuant to the Answer of 4 November 2024 to Question 11837 on Integrated Security, Defence, Development and Foreign Policy Review, if he will set out for each of those reviews (a) the process for establishing the evidence base and (b) whether it will be undertaken (i) internally and (ii) include external consultation.

In relation to my answer of 4 November 2024 to Question 11837, the aforementioned reviews are scheduled to conclude in the first half of 2025. Decisions about publication and consultation are matters for the relevant department owners. The Cabinet Office owns the resilience review which will conclude in Spring 2025 and will set the future direction for the resilience system. It is an internally-led review which will draw on existing evidence to inform what is working well and what could change, including the findings from the Covid-19 Inquiry Module 1 and the Grenfell Inquiry. In addition to regular discussions with stakeholders, Ministers and officials are continuing to meet with those from devolved, regional and local Government, businesses and civil society.

How much private investment he expects from the additional funding allocated to the aerospace sector in the next five years.

The Budget confirmed £975m over 5 years to the Aerospace sector. This provides continued stability and confidence for industry to invest in long-term R&D projects – delivering economic growth, supporting high skilled jobs across all parts of the UK, and advancing aviation’s net zero transition. Between 2013/14 and 2029/30, industry and government will invest over £5bn developing transformational aircraft technology. Long-term R&D co-investment is a core pillar of the Aerospace Growth Partnership’s 2022 strategy, where the UK sector committed to invest at least £20bn of further private investment to 2040 and abate 125 MtCO2 of UK attributable global aviation CO2 emissions.

What steps his Department plans to take to ensure value for money from additional funding allocated to the automotive sector in the next five years.

The Budget committed over £2bn to 2030 for zero-emission vehicle manufacturing and their supply chains. This will build on the current Automotive Transformation Fund (ATF) and Advanced Propulsion Centre (APC) programmes to drive economic growth and support high-value jobs, unlocking billions of pounds of private investment in the UK’s automotive industry and R&D innovation ecosystem. As with the ATF and APC programmes, all future investment will be fully assessed on a strategic, technical, commercial, financial and economic basis – including consideration of future job creation. The economic assessment ensures value for money is consistent with HMT Green Book best practice.

What steps his Department plans to take to ensure value for money from additional funding allocated to the aerospace sector in the next five years.

The Budget confirmed £975m over 5 years to the Aerospace sector. Industry led applications for R&D co-investment from the ATI Programme enter a competitive process. Competition for funding is fierce and only the best projects are selected: those that offer real innovation, reduced emissions and tangible economic benefits to the UK. Each application is subject to a value for money assessment by DBT economists, which underpins the estimated benefits from the Programme of at least £20bn of further private investment to 2040 and abatement of 125 MtCO2 of UK attributable global aviation CO2 emissions.

With reference to his Department's publication entitled Invest 2035: The UK’s Modern Industrial Strategy, published in October 2024, what assessment he has made of trends in the level of economic performance of sectors included in that strategy since 2019-20.

The methodology for determining the eight growth-driving sectors is outlined in the Invest 2035 Green Paper. This included assessing historic trends since 2019-20, such as gross value added and productivity, at Standard Industrial Classification-2 level where data was available. The Government complemented this with wider internal and external data sources such as specialist industry reports and qualitative assessments, particularly in emerging subsectors where historic data is unavailable. Government will continue to draw in evidence such as sector performance and employment trends using responses to the Green Paper consultation questions; engagement with external stakeholders such as businesses, local leaders, academic experts; and other data sources.

How much private investment he expects from the additional funding allocated to the automotive sector in the next five years.

The Budget committed over £2bn to 2030 for zero-emission vehicle manufacturing and their supply chains. This funding will build on previous ATF and APC programmes which have leveraged over £6bn of investment from the private sector so far. We will continue with this success, unlocking billions more in private investment to support our automotive industry. Further details will be announced as part of the industrial strategy.

What her target level of economic growth is from the overall level of capital spending in the next five years.

Economic growth is the number one mission of the government. Through the growth mission, the government will deliver a milestone of higher living standards in every part of the United Kingdom by the end of the Parliament. Investment is a vital part of addressing the growth challenge. Autumn Budget began rebuilding Britain by increasing public investment and unlocking private investment. Public sector net investment will average 2.6% of GDP over the Parliament, with over £100 billion of additional capital investment over the next five years. This will strengthen the UK economy over the long term. When making allocation decisions, the Treasury scrutinises individual capital spending proposals in line with the principles set out in the Green Book and Five Case Model, to ensure that they deliver value for money. It also considers these in line with the government’s wider priorities, such as growth, and their overall deliverability and affordability. The independent Office for Budget Responsibility produces regular and comprehensive forecasts on the impact of current government policies, including judgements about fiscal multipliers. The OBR confirms that the Budget will have a positive impact on GDP in the next parliament and into the longer term from additional public investment. If sustained, the OBR judges the higher public capital spending, and the higher private sector investment this incentivises, could increase potential output by 0.4% after 10 years, and 1.4% in the long run.