The Department for International Trade is unable to demonstrate it has made headway on tackling the major strategic challenges it faces more than four years on from its creation, a committee of MPs has said.
In an examination of the work of the ministry, which was founded by Theresa May as prime minister to develop the UK's post-Brexit trading relationships, the Public Accounts Committee said it had "made many statements of future intent”, but "has not demonstrated measurable progress to tackle the big strategic challenges it faces". These include supporting economic recovery in the wake of the Covid-19 pandemic, and in advancing the UK’s future trading relationships.
In particular, the MPs said a lack of “robust metrics” against which to benchmark DIT’s work had made it impossible to gauge its progress on major goals.
“A lack of robust performance measures means that it is not possible to hold the department accountable for the effectiveness of its action to deliver government’s ambition to grow exports to 35% of GDP,” they said.
The report called on DIT to set out measures “that enable us, parliament and the taxpayer to hold it to account for its impact on exports, and which capture the full range of its activities to support exports” by the end of the year.
The committee also identified what it called a “lack of strategic alignment” between DIT and UK Export Finance, the government’s export credit agency, that it said may have led to export opportunities being missed.
DIT and UKEF have yet to sign a memorandum of understanding setting out how they should work together, which the MPs said “would ensure that the outcomes they are seeking are consistent and aligned, and that the two departments have clear expectations of what they do for each other”.
The report also called for DIT and UKEF to work more closely together to “respond to new export growth opportunities” – for example, by identifying and investing in new businesses in renewable energy and other developing industries.
They have yet to develop “sufficient understanding” of the barriers for smaller businesses to exporting, such as applying for finance, according to the report.
“Out of an estimated 5.9 million UK businesses, the department targets its bespoke support at just 230,000 potential exporters, and UKEF directly supported only 199 customers in 2019,” the report said.
Among other things, the MPs urged the two departments to improve the support they offer to small businesses “as a matter of urgency”.
They said DIT and UKEF must sign an MoU by the end of the year setting out how they will work together, and commit to reporting publicly on their progress.
DIT hits back: 'Claims not supported by the evidence'
Responding to the report, a government spokesperson said: “The conclusions of the report are not supported by the evidence. We have just struck a comprehensive deal with Japan that goes well beyond the EU, and over the past two years have signed or agreed in principle trade agreements with 51 countries, worth £144bn of UK trade in 2019.
“Last year the UK overtook France to become the fifth largest exporter by value, and was the only top ten exporting nation to see an increase in exports.
“We are significantly enhancing our digital offer to businesses to help them compete and thrive in the modern global economy, and recently launched a new Export Growth Plan to help companies grow their trade overseas.
“Work to improve our offer will continue as part of the government’s ongoing support for exporters, and we are working closely with UK Export Finance as we develop our offer to small and green businesses."
The comment came after DIT attempted to promote its recent trade deal with Japan on social media – responding to a commentator who pointed out trade tariffs on food products would not change for the UK after the transition period: