Martin Howell, the senior warden of the Cutlers' Company, said the turmoil in the financial services sector underlined the important role played by manufacturing in maintaining the UK's economic stability.

Mr Howell made his comments at the 372nd Cutlers' Feast in Sheffield, which was held in the Cutlers' Hall. The event is organised by The Company of Cutlers in Hallamshire in the County of York, a body that has spoken up for South Yorkshire's business community since 1624.

In his speech, Mr Howell said: "UK energy policy, or lack of it, is a subject close to my heart. Many of us were supportive and excited about the privatisation of the electricity supply industry some years ago. However, this support soon changed to concern and frustration when we learnt that supplies to major industrial consumers in the UK were to be priced based on long run marginal cost.

"Unfortunately, most of our European competitors were enjoying prices based on being a base load to the system. Thus, overnight, great tranches of UK industry were made uncompetitive. At least in those days there was a Department of Energy and a secretary of state we could complain to. Today, energy ranks so low in the political priorities that it has been subsumed into the Department for Business, Enterprise and Regulatory Reform. Of course, we had North Sea oil and gas so, knowing that it was not going to last forever, we made a dash for gas fired power stations and thus depleted this valuable resource.

"So then the penny drops that we may be in a relatively vulnerable position dependent on imported gas supplies, and so we agonise for ages and ages about what the alternatives should be.

"And when we have made our decision, we'll spend years and years with public inquiries before we can get on with building the next generation of power stations."

Mr Howell said politicians needed a better understanding of manufacturers' needs and must realise that, although the service sector was important, manufacturing will continue to play a vital role in the UK economy.

He added: "The recent turbulence in the financial services industry is testimony to the need to maintain and encourage a significant manufacturing sector in the UK economy."

Mr Howell said growing global competition meant that anyone entering manufacturing needed a different set of skills.

He added: "By this, I don't mean all of our young people have to aspire to university degrees. We in manufacturing must persuade more of our bright young people that a career in manufacturing is attractive."

The principal guest of the Master Cutler, Gordon Bridge, was William Hague, the Shadow Foreign Secretary.