- Business Secretary announces new funding packages for chemicals and ceramics sectors, boosting stability and economic resilience.
- £350 million Critical Chemicals Resilience Fund will support strategically important producers and sites, strengthen critical supply chains and help support thousands of skilled jobs.
- Ceramics package worth £120 million will back energy efficiency, decarbonisation and long-term competitiveness in sector vital to UK manufacturing.
The Government has today (21 May) unveiled a major new funding package to revitalise British industry and shore up the UK’s long-term economic resilience.
Thousands of UK jobs across British industry are set to be secured thanks to £350m of Government support for strategically important chemicals producers and sites alongside a separate £120m scheme for the ceramics sector.
The funding – targeted at strategically important parts of the economy that keep vital everyday UK infrastructure running, support thousands of skilled jobs and protect Britain’s economic security – is designed to help firms stay competitive, modernise infrastructure, decarbonise, and transition their energy supplies from gas to electricity.
Business Secretary Peter Kyle said
At a time of global uncertainty it’s never been more important to ensure Britain’s resilience and back the industries our country depends on, and this funding will support thousands of jobs and put businesses on a secure footing for the long term.
This is what a strategic state looks like acting swiftly with targeted support in the national interest and giving certainty to the industries crucial to both our everyday lives and our economic future.
Chancellor of the Exchequer Rachel Reeves said
The chemicals and ceramics industries underpin our economic resilience and support skilled jobs across the UK.
We have the right economic plan. It includes backing those workers, backing the communities that depend on them, and backing British industry for the long term.
The £350 million Critical Chemicals Resilience Fund will back the UK’s most strategically important chemical producers – the firms that supply the critical inputs relied on by sectors including food, energy, water and healthcare.
The fund has been designed to keep these key producers and sites competitive, put businesses on a more sustainable footing and strengthen supply chain resilience. It will be developed in partnership with industry representatives and independent experts.
The Government will continue to work hand-in-hand with industry to ensure broader policy delivers decarbonisation and not deindustrialisation. We are committed to tackling unfair foreign trade practices, and Ministers will urgently convene the chemicals industry to explore potential trade defence action.
The Government is also committed to driving down regulatory costs faced by the industry. We have already cut back the need for UK businesses to buy expensive and unnecessary data, cutting transition costs while maintaining health and environmental protections. We will work with the industry to identify where the UK can go further to reduce regulatory costs and remove duplicative procedures for businesses.
Chief Executive of the Chemical Industries Association Steve Elliott said
The Government rightly included the chemical industry as a key foundational sector in its Industrial Strategy for the country. Today’s announcement of a £350m fund to be made available to chemical businesses underpinning our critical national infrastructure and wider resilience is therefore a very welcome first step in turning those words into action.
Much is needed – both in terms of policy and funding support – to address the industry’s energy, carbon reduction and broader regulatory costs – and the Government’s additional commitment to work in partnership with the industry to tackle those huge competitiveness challenges is also encouraging.
A separate package for the ceramics sector will include £120m of support to back capital investment in energy efficiency and decarbonisation projects, as well as provide operational support for successful applicants to the fund who require additional support to manage increased costs.
Ceramics are not only crucial for housebuilding and everyday items like plates, bowls and smartphone screens but strategic industries such as advanced manufacturing, defence and tech, backed by the UK’s Modern Industrial Strategy.
Their ability to operate at very high temperatures and resist corrosion make them vital for products from armour plates to plane engine coatings, and hip implants to space shuttle panels.
Support for the ceramics sector will be open to eligible UK manufacturers across subsectors including refractory products, clay building materials, household ceramics and technical ceramics.
The support will also help modernise an industry with proud UK heritage and a major local employer in communities from Stoke-on-Trent to Devon. The Government will work closely with the industry on delivery of the support, with further details to be confirmed shortly in the summer.
In a fresh call today, Ministers are also urging ceramics producers to engage with the Trade Remedies Authority, who can impose tariffs, to provide evidence where they believe existing trade remedy measures are not enough, or to support new investigations.
CEO of Ceramics UK Rob Flello said
Ceramics UK is delighted by this landmark decision by the Government which recognises the fundamental role of our sector in the UK economy.
Ceramics are critical to the UK economy in the manufacture of vital products such as steel, glass and other high temperature products, as well as items that are used daily in homes and businesses across the UK.
Now, working with our members as the voice of the industry, Ceramics UK looks forward to working closely with Ministers and civil servants in designing and implementing the measures outlined in the Business Secretary’s statement of intent.
Our priority is to ensure that the scheme works for all members of Ceramics UK, from the smallest ceramics companies through to the largest organisations, creating a sustainable future for our industry.
Charlotte Brumpton-Childs, GMB National Secretary, said
GMB has been calling for the Government to step up support for energy intensive industry.
This is a hugely welcome step in the right direction and will be reassurance to workers in our chemicals and ceramics industry that Government is finally listening.
These announcements, targeted at longer-term economic resilience, come alongside temporary help the government has announced to support people and businesses this year.
These steps entail a near term cost but HM Treasury has confirmed that the overall package will not increase borrowing in the medium term. All costings will be subject to certification in the next OBR forecast in the usual way.
Background
- The Government will work with industry to design and shape the Critical Chemicals Resilience fund to deliver the greatest impact. The fund will be developed in collaboration with independent experts and industry, which we expect to start in summer 2026 and made available over a multi-year period, with further details to be set out shortly.
- Today’s announcement follows recent Government action to back the chemicals sector, including a £120 million package to protect vital chemical production at Grangemouth, and restarting production at the Ensus bioethanol plant in Teesside to protect CO2 supplies.
- Applications to the ceramics package are expected to open in the summer once final design work is complete.
- The strategic new support comes on top of the Government’s action to tackle industrial energy costs through the British Industrial Competitiveness Scheme (BICS) and the British Industry Supercharger, which will save thousands of UK businesses hundreds of millions of pounds on their energy costs.
