Manufacturers’ organisation Make UK has written directly to Business Secretary Jonathan Reynolds, calling for an urgent review of the eligibility criteria for the British Industrial Competitiveness Scheme (BICS).
While welcoming the funding clarity outlined in the recent Budget, Make UK warns that rigid sector classifications risk excluding internationally competitive manufacturers facing demonstrably high electricity bills, leaving vital industrial businesses without support until a proposed review in 2030.
The Risk of Missing Out on Critical Support
Recent Make UK data underscores the urgency of the issue, revealing that 13% of manufacturers believe another energy price shock could prove terminal for their business. Although BICS aims to help eligible firms manage electricity costs, Make UK argues that relying exclusively on broad sector averages and product codes could shut out energy-intensive companies that compete directly on the global stage.
To illustrate the flaw in rigid classifications, the organisation highlighted the case of Advance Tapes Group, a manufacturer based in Thurmaston, Leicestershire, employing 102 people and exporting more than 75% of its UK production:
- Efficiency vs. Rising Bills: Between 2021 and 2025, Advance Tapes successfully reduced its electricity consumption by 22%.
- Surging Costs: Despite cutting usage, its total electricity bill surged by 52%, climbing from approximately £342,000 to £518,000.
- Higher Unit Costs: Its average effective electricity cost jumped from roughly 12p to 23p per kWh.
- Exclusion Risk: Despite having an indicative company-level electricity intensity of roughly 12.7% of Gross Value Added (GVA), the company appears largely excluded from BICS because most of its pressure-sensitive adhesive tapes do not fall under the scheme’s designated Standard Industrial Classification (SIC) and product codes.
Make UK’s Three-Point Plan for Government
To ensure the Government’s reindustrialisation ambitions translate into economic reality rather than political slogans, Make UK is urging Ministers to take immediate action on three fronts:
- Introduce an Alternative BICS Route: Allow individual manufacturers to demonstrate eligibility based on actual electricity intensity and exposure to international competition, rather than relying strictly on sector averages.
- Remove Administrative Barriers: Eliminate unnecessary bureaucratic hurdles, including the complex burden of requiring specific HS codes for product identification.
- Tackle Underlying Energy Levies: Remove policy levies from industrial electricity bills to eliminate the structural cost disadvantage facing UK manufacturers and encourage long-term green investment and electrification.
Make UK Chief Executive Stephen Phipson (pictured) emphasised that without swift intervention, the UK’s manufacturing base, which supports 2.6 million jobs and accounts for 42% of UK exports, will continue to face a ruinous cost disadvantage against international competitors.
Key Takeaways for Growth Hub Readers
Review Scheme Criteria: Manufacturing and supply chain leaders should assess whether their operational energy intensity matches current BICS classifications or if administrative barriers leave them exposed.
Factor Energy into Long-Term Planning: With high effective kWh costs squeezing margins, regional firms must factor structural energy overheads into upcoming capital and operational expenditure forecasts.
Advocate for Evidence-Based Policy: Industry bodies continue to lobby for more flexible, company-level assessment models that reflect actual international market exposure rather than broad sectoral groupings.
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