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Survey Flags Imminent Collapse of UK Manufacturing The latest Make UK member survey reveals that thousands of British manufacturers are on the brink of bankruptcy unless energy prices are curbed. Chief executive Stephen Phipson warned that confidence has fallen to a four‑year low, and the sector could face deindustrialisation without urgent action. Energy Price Shock Drives Business Decisions Energy costs in the UK are reported to be twice the European average and four times higher than in the United States. The survey shows how firms are reacting: 25% of manufacturers are planning to move production overseas or have already done so. 10% say they are likely or very likely to become insolvent within the next 12 months. 46% have experienced a further rise in energy bills since the Middle‑East conflict began. 60% of those firms are passing the increased cost onto customers. Numbers Reveal Scale of the Crisis Financial pressure is evident across the sector: 98% of respondents expect a significant squeeze on profitability in the coming quarter. 38% have delayed investment projects. 21% have reduced headcount. About 800 of the UK’s 130,000 manufacturing firms are large and predominantly foreign‑owned. Government taxes and levies account for roughly £3 bn (about 50%) of industrial energy bills. Broader Implications for the UK Economy The survey highlights a widening gap between large exporters, who can shift production to cheaper energy markets in Europe and Asia, and smaller domestic firms, which are forced to cut investment and jobs to survive. The potential loss of well‑paid jobs in poorer regions, as noted by TUC general secretary Paul Nowak, could deepen regional inequality and weaken the country’s industrial base. What Policy Moves Could Avert Deindustrialisation Industry leaders are calling for immediate fiscal relief: Extend the Treasury’s coverage of carbon taxes and levies, similar to the approach in France and Germany. Accelerate the British Industrial Competitiveness Scheme (BICS), which currently takes effect in April 2027, to provide earlier support. Maintain the April‑extended subsidy that reduces bills by up to 25% for 10,000 heavy‑energy users. Review the marginal pricing system that links gas costs to electricity prices, given that gas supplies 30% of UK electricity generation versus 16% in Germany and 3% in France. Government officials acknowledge the challenges and cite the modern industrial strategy as a framework for cutting electricity costs and supporting sectors such as chemicals and ceramics. The speed and scale of any intervention will determine whether the UK can halt the slide toward deindustrialisation.

The UK defence industry is in a state of crisis as a long-delayed military spending plan has left firms 'bleeding cash' and in 'paralysis'. The six-month delay to the defence investment plan (DIP) has resulted in some companies going bust, while others are struggling to stay afloat.Industry groups have warned that the delay has left the UK behind Germany and the US in attracting investment from global investors. The DIP, originally expected last autumn, has been repeatedly postponed amid warnings that the military faces a £28bn funding gap over the next four years.Samira Braund, the defence director of the ADS Group trade body, described the situation as 'paralysis', stating that the government has not put effective mitigation plans in place. The boss of BAE Systems, Europe's biggest defence contractor, has urged ministers to publish the plan, while some smaller firms have been forced out of business.One such company was MTE Heat Treatment, a Yorkshire-based manufacturer with just over 30 employees that helped make turbine blades for jet engines. It fell into administration in February. Andrew Kinniburgh, the head of the trade body Make UK's defence arm, warned that the delay risks deterring investment in the UK at a time when the US and Europe are also raising military spending.The DIP will show how the government plans to fund its strategic defence review, the blueprint for transforming the military amid growing threats from Russia, rising commitments to Nato and against the backdrop of the US-Israel war on Iran. Ministers accepted all the review's recommendations when it was published last June, but the head of the military, Air Chief Marshal Sir Richard Knighton, told MPs in January that defence cuts would be needed without more funding.