In its report, Pulling Together, published on 20 October, the CBI recommends ways to kick start the UK’s supply chains, and solutions to reinvigorate Britain’s industrial strategy.

Among the recommended measures is a call for the Government to commit to increasing overall spending on R&D in the longer-term with an aim of reaching a combined public and private R&D spend of 3% gross domestic product (GDP).

The report reveals that although the existing R&D tax credits system has been improved and its impact is increasing, it does not carry through to support later stages of commercialisation and manufacturing in the UK of innovative products.

It therefore encourages the government to develop a ‘supercharged’ use of R&D tax credit to incentivise the domestic commercialisation and manufacture of UK-generated ideas.

To support long term investment from industry, the report suggests that the government should to improve access to ‘patient capital’ for medium sized companies and encourage collaborative investment in R&D through the tax system.

Another solution to strengthen the UK’s supply chains set out in the report is for the government to make tax rules to encourage long-term investment in both small and medium-sized enterprises (SMEs), for example, revise the SME R&D partnership enterprise rules around non-controlling corporate interests to remove disincentives around corporate investment in innovative medium sized businesses in the UK’s supply chains.

The CBI report is available here www.cbi.org.uk/media/3576042/cbi_supply_chain_report.pdf