Exclusive: Nestle chief's plea to support our 'world class' food sector

The chief executive of Nestle UK said politicians take food safety and supply for granted and instead choose to attack the industry over negative issues such as obesity.

In the UK, the food industry generates about 72.8bn of turnover, accounts for 15 per cent of the UK's total manufacturing output and employs around 3.6 million workers.

Speaking ahead of today's general election, Paul Grimwood said: "We invest hugely as an industry in the infrastructure of the country. The next prime minister really needs to look at getting behind the food industry in the UK because it is one of the world class businesses that we have."

The worst winter for decades and flight disruption caused by the Icelandic volcano had "hardly any impact" on supermarket shelves, he added.

Mr Grimwood said: "Our supermarkets are some of the most efficient in the world. The businesses that supply them have got to be the most efficient manufacturers of food stuffs in the world in order to be able to supply them effectively."

The next government must develop policies to support private sector investment in factories, training and product development to help kickstart the UK's faltering economy, he said.

"Investment in any industry is not going to come from government. We are going to have to see significant cutbacks in government expenditure. It will be the private sector that invests," he added.

Mr Grimwood said the education system should be designed to meet the needs of business at a local, regional and national level.

In a damning indictment of the current system, the comprehensive-educated chief executive said Nestle UK struggles to find engineers, technicians, nutritionists and dieticians and has had to resort to recruiting staff from the company's European business.

He said education must be more closely aligned to business requirements: "What happens at the moment is we have people coming in that we have to start all over again with to train, be that on a graduate level or apprentice level."

Asked about the long-term danger of this state of affairs, he said: "Yet again, being uncompetitive."

Mr Grimwood, who sits on Nestle's European board, added: "The world is changing really quickly. It's an accelerated change. The markets we see coming out of recession first are the big developing markets in India and China and we have invested in those markets. We have also invested in Eastern Europe and Russia.

"We are very capable of competing in the UK, but we need the right mix. The right mix is good capital investment and highly efficient factories that you constantly invest in. The mindset has to change. Investment in manufacturing is not a one-off event.

"The second most important thing is the quality and capability of the people. Are they correctly trained? Are they trained in the right areas? Are they trained to a high enough level?

"The third thing for me is regulation. We are drowned in regulation and red tape. Whichever government gets in has got to do a better job of reducing the costs on industry."

Nestle UK employs around 7,000 people across 19 sites and has a turnover of more than 2bn a year.

In York, a key facility, the company has spent 15m on a new Aero plant and is in the process of spending another 15m in upgrading wafer technology for KitKats, on top of 5m in redesigning the site.

York's daily production output would line the route to Westminster and back and would include 3.5m two-finger KitKats and 2.4m four-finger KitKats.

Nestle, which also makes Nescafe, Shredded Wheat and Buxton Water, beat forecasts last month with a 6.5 per cent rise in underlying first-quarter sales and was upbeat about its 2010 prospects.

The recovery will prove a slow process

Nestle UK's chief executive and chairman believes the UK will avoid a double-dip recession, but he does not see a big improvement in the country's economic fortunes in the short term.

Paul Grimwood, 47, said: "People's confidence has been really knocked. We will progress, but progress slowly. We will be looking at a three-year period before people's confidence goes back to where it was in the mid-90s."

The biggest challenge facing the business in recent years has been wild fluctuations in currency rates and commodity prices.

For a business which buys many of its raw materials from abroad, both of these factors have had a big impact.

"You can hedge," said Mr Grimwood, "but hedging normally covers you for a five or six per cent fluctuation in movement; it does not cover you for a 25 or 30 per cent movement.

"You can try and buy further ahead; you can try and buy better. Some things we have bought long, some things we have spot bought."

Nestle UK has tried to restrict price increases and instead concentrate on making the business more efficient.