NO SOONER does the government announce its latest idea for a national industrial strategy, with £1bn to support the aerospace sector, than proof pops up of just how hard it is to pick a winner. UK pharma giant AstraZeneca announced yesterday it will be cutting 700 jobs and relocating a further 300 outside the UK as part of a major shakeup that will see its headquarters move to join the Cambridge bioscience cluster.
This follows the government’s much-trumpeted patent box initiative, which gives UK-owned intellectual property a lower corporation tax rate, intended to be an incentive to the IP-driven pharma sector. The tax break helped buy 1,000 jobs in a new factory to be built by GlaxoSmithKline in Cumbria. But with 1,500 jobs lost in the 2011 closure of Pfizer’s Sandwich plant and now another 1,000 jobs to go thanks to AstraZeneca, many of them in the chancellor’s own constituency, the country’s strategic backing for pharma doesn’t seem to be going quite to plan.
By contrast, the decision to move to Cambridge makes perfect sense, as a firm adapts to the unplanned messiness of reality. Cambridge has evolved into one of the most exciting business regions in the UK, where the research facilities and hungry talent of a top university interact with tech firms like Arm as well as bioscience innovators including Abcam and soon AstraZeneca.
Silicon fen, as it is sometimes called, was not the product of a government five-year plan, but the private brainchild of Cambridge Consultants. While the government touts patent boxes and its East London Tech City, companies are making up their own minds. Investors will follow suit.