Public projects should help British firms, says Mandelson

Britain should never approve major public procurement projects in key areas such as transport and energy without ensuring there are "supply-chain opportunities" for British companies, Lord Mandelson said last night.

In a speech at Mansion House, the business secretary called for a new "industrial activism" to ensure that British companies could benefit from industries that will develop as the world emerges from the recession.

Showing how New Labour's thinking has evolved since the 1990s, when it launched a "prawn cocktail" offensive in the City to burnish its pro-business credentials, Mandelson said the centre-left has been "spooked" by the idea of state intervention.

"We've been so spooked - often rightly - by the very idea of 'state intervention' that we've been too cautious in asking what more we can do as a country to equip ourselves to compete in a global economy and to bring high-value jobs here," he said.

Under the new "industrial activism", the government should help companies prepare for opportunities that will arise in the future. Mandelson said: "We should never make a major regulatory or public procurement decision in the UK - on transport, energy or anything else - without asking whether there are supply-chain opportunities for UK-based companies to compete for. And if there are, and if it makes long-term economic sense for the UK to compete for them, we have to equip ourselves to do so."

The business secretary said that his remarks were not a new form of protectionism. "Our new industrial activism will never become a new economic nationalism," he said.

Mandelson believes the government needs to do better in thinking for the long term on how to prepare businesses for the future. He has two key developments in mind:

• The new generation of civil nuclear power stations in Britain will open up major opportunities for companies from building the new stations right the way to the supply line.
• As tougher regulations come into force across the world on climate change, there will be an increase in demand for low-carbon technologies.

Mandelson said: "Like a blue-chip stock that has taken a knock in daily trading, I believe the UK's fundamentals will be borne out when the global economy returns to growth. We will restore, rebuild, and emerge stronger and better."

Source: The Guardian