UK chancellor John Healey’s autumn budget included several measures intended to promote ‘reindustrialisation’ in the UK. These include implementing the British industrial competitiveness scheme – introduced as part of the 2025 industrial strategy – to reduce electricity costs for energy-intensive manufacturing businesses.
For the chemicals sector, the chancellor confirmed funding for the previously announced £350 million Critical chemicals resilience fund – to help those firms manage rising costs, and to modernise, decarbonise and electrify their processes.
In pharmaceuticals, the chancellor highlighted three public–private investments in R&D and manufacturing facilities totalling £1 billion – by Vertex pharmaceuticals, contract R&D provider Convatec and medical device producer Kindeva, supported by £70 million in government grants. Making the UK more appealing to this kind of investment will depend on a variety of factors, and can easily be swayed by policy decisions, as shown last year when several companies withdrew investment plans after a breakdown in negotiations over drug prices.
The budget also included multiple references to the chemicals sector and its supply chains as ‘foundational’, ‘strategically important’ and ‘vital’. While that language will be welcome reassurance for industry leaders that the government has recognised the importance of the sector, there will no doubt be many who say the government’s practical measures still do not go far enough to reverse the rapid decline of the UK chemicals industry over the last decade or so.
That’s not merely about disbursing funds to shore up industry as it battles rising costs and cheap imports. Before the budget, the UK Chemical Industries Association (CIA) had called on the chancellor to commit £1 billion across a variety of measures to rebuild the sector’s competitiveness and encourage private sector re-investment, which included reforming companies’ administrative requirements under UK Reach (registration, evaluation, authorisation and restriction of chemicals) laws.
This week had, until earlier this year, been set as the first deadline for registration of chemicals that had previously been registered through EU Reach before the UK left the EU. However, in mid-July, the registration deadlines were extended to 2029, 2030 and 2031, depending on volume and hazard profiles. As this process drags on, companies face more uncertainty in trying to predict the impact of the regulations.
Part of the reason for that extension is that the government is still consulting on its latest round of revisions to the UK Reach rules. The consultation, which runs until 10 November, centres on the Alternative Transitional Registration model that relies heavily on the EU’s regulatory assessments of chemicals, with only modest information required up front to transfer registration of a chemical that had been registered in the EU pre-Brexit.
The rules therefore do not necessarily require UK businesses to reproduce or pay for access to the full data held under EU Reach for every substance, although there are conditions under which the government may subsequently require additional data. This mechanism was developed after the UK Department for Environment, Food & Rural Affairs estimated in 2022 that it would cost £1.3–3.5 billion to replicate or get legal access to the full datasets.
The transitional arrangements aim to strike a balance between minimising the cost and administrative burden on businesses, while maintaining sufficient data for regulators to protect human health and the environment. While companies will doubtless have been preparing for the anticipated regulations as best they can, finalising the rules promptly will remove a degree of uncertainty over the compliance requirements, enabling them to focus more resources on improving competitiveness and growth.
