Ceramics UK disappointed on energy relief in ‘underwhelming’ Budget
Ceramics UK has expressed disappointment that opportunities to support the ceramics industry were missed in the 2026 Budget.
While the Chancellor highlighted the British Industrial Competitiveness Scheme (BICS), confirming support for eligible manufacturers from April 2027 alongside a backdated payment for 2026–27, there was no move to extend eligibility to much of the ceramics sector. Applications for the scheme opened on 1 October.
Many energy-intensive ceramic manufacturers remain ineligible for both BICS and the British Industry Supercharger, despite relying on high levels of electricity as well as gas for sustained high-temperature manufacturing.
Ceramics UK CEO Rob Flello said:
“This was an underwhelming Budget with missed opportunities to support a cornerstone industry.
“Ceramics is at the very heart of industrial Britain, with many vital products and components made within the sector needed for the production of crucial materials such as glass and steel.
“It is disappointing that many energy-intensive ceramics manufacturers remain ineligible for BICS and the British Industry Supercharger.”
Industrial energy and decarbonisation
Ceramics UK welcomed the decision not to proceed with the proposed Gas Shipper Obligation, removing a degree of uncertainty for manufacturers. Had the levy been introduced, Ceramics UK believes there would have been a strong case for gas-intensive sectors, including ceramics, to qualify for exemptions. The Budget confirmed that the planned levy will not be introduced and that Government will instead fund committed hydrogen contracts directly.
However, reductions in capital grant support for carbon capture, usage and storage (CCUS) and hydrogen projects have raised further concerns. The Budget sets out savings of £200 million from CCUS capital grants and £500 million from hydrogen capital grants, while Government explores alternative loan and equity investment for some future projects.
Ceramics UK has raised concerns that technologies such as hydrogen and CCUS are not yet cost competitive for many industrial applications, while current eligibility for BICS and the British Industry Supercharger can also limit the support available to manufacturers considering greater electrification.
The Association has also highlighted the contrast with support available to industrial operators in Europe, including through the EU ETS Innovation Fund, which supports decarbonisation projects in energy-intensive industries.
Rob added:
“This was a missed opportunity to recognise the role of ceramics and the UK’s gas-intensive industries.
“Decarbonising energy-intensive manufacturing requires technologies that are not yet cost competitive, while UK manufacturers are competing internationally with businesses that can access different forms of industrial and decarbonisation support.
“Without the right support, there remains a risk of decarbonisation through deindustrialisation.”
Ceramics UK will continue to call for internationally competitive energy costs, access to appropriate energy relief schemes and practical support that enables UK manufacturers to invest, compete and decarbonise.
Cautious welcome for Your First Home scheme
The Your First Home loan scheme for first-time buyers received a cautious welcome from Ceramics UK.
The Government has announced £4.7 billion Your First Home scheme, which will provide eligible first-time buyers in England with a 20% equity loan. Pre-registration is expected by the end of December 2026, with full applications opening in February 2027 and the first loans issued from April 2027.
Rob added:
“The Your First Home scheme could be helpful if it is implemented in the right way.
“Many potential buyers will now wait to see if they are eligible for the scheme before deciding on a purchase, which could cause a problem for housebuilders in the short term.”
Ceramics UK will continue engaging with Government on the detail of the Budget measures and making the case for the conditions UK ceramic manufacturers need to invest, compete, grow and decarbonise while maintaining a strong domestic manufacturing base.