techUK's submission to the Autumn Budget and CSR 2021outlines four pillars to remove the barriers to tech-led growth to underpin a strong economic recovery.
On October 27, Chancellor Rishi Sunak will release the 2021 Autumn Budget outlining the Government's budgetary priorities for 2021/2022, as well as the Comprehensive Spending Review, which will deliver the departments' resource and capital budgets for 2022-23 to 2024-25, in order to meet the objectives of the government's Build Back Better: Plan for Growth.
In its submission to the Treasury, techUK is calling on the Government to focus on removing barriers that hinder tech-led growth, in order to achieve a strong economic recovery and long-term prosperity. In the UK, workers in roles that heavily use digital technologies contribute twice as much GVA as non-digital workers, and the digital sector grew six times faster than the overall economy prior to the crisis, indicating that the tech sector has enormous potential to lead the way to recovery.
Tech-led growth entails not just the expansion of the tech sector, but also the widespread adoption of technology throughout the UK economy. This process of digital adoption, that was accelerated in response to the pandemic, is no longer a temporary reaction that demonstrated the adaptability and creativity of British people and businesses, but is now central to the growth strategies of companies across the economy, with tech and digital led models being placed as the heart of companies all over the UK economy.
techUK believe the Treasury has a unique role to lay the basis to support businesses to pursue growth and transformation strategies based on the greater use of digital services and advanced technologies. Supporting tech led growth will enable a step change in productivity and our way of doing business. Providing the support for this will not be done in one fiscal statement, but the first multi-year spending review since 2015 and the first budget since the end of the UK's lockdowns provides a unique opportunity to seize the initiative.
In the submission to the 2021 Autumn Budget and CSR, techUK and its members set out four pillars to remove the barriers to tech-led growth:
- Putting in place a regulatory framework that drives tech led growth
- Delivering the right digital skills for businesses and people
- Building a world-class digital infrastructure suitable for the challenges of the future
- Ensuring the competitiveness of the UK innovation ecosystem.
Putting in place a regulatory framework that drives tech led growth
Developing strong principles that support innovative regulation, is not just good for UK tech, but also increase consumer welfare by allowing British consumers access to and the confidence to use the latest digital services.
In a current digital regulatory space that is undergoing several reforms, techUK used this opportunity to encourage the government to ensure the principles of the Plan for Digital Regulation to actively promote innovation, achieve forward looking and coherent outcomes and exploit opportunities and address challenges in the international arena are met as new regulations are develop to ensure the UK maintains a world leading regulatory system.
However, that is only the first step, techUK believe that the current context urges that the government go above and beyond by expanding sandboxing schemes and forming new regulatory taskforces to encourage investment in key technologies such as autonomous systems.
Delivering the right digital skills for businesses and people
Without people and businesses with the right digital skills, there will be no digital jobs to drive tech-led growth. To lay the groundwork for an accelerated recovery, we must seek to boost the UK's productivity and make the use of digital solutions such as trading platforms, RegTech, and cloud services commonplace, not only to assist businesses in finding the tools they need to deal with new challenges, but also to revolutionise the way the UK does business on a daily basis. This will boost tech-led growth across all industries, resulting in the creation of new and well-paying employment.
To achieve this, techUK believe is crucial to expand the Help to Grow: Digital scheme as well as the creation of a SME Digital Skills Tax Credit to support businesses to adopt the digital services they need as well as to retrain staff.
Building a world-class digital infrastructure suitable for the challenges of the future
The UK economy is supported by its infrastructure. In the short term, infrastructure investments stimulate economic growth and help create job opportunities, becoming an important pillar in the post-Covid-19 economic recovery; in the long term, high-quality infrastructure investment helps boost productivity and competitiveness, allowing the UK to create the right environment for future challenges.
To accomplish this, techuk, among other measures, encourages the government to deliver on the Government's commitments to roll-out 5G and gigabit capable broadband by investing a further 250 million in the Telecoms Diversification Programme and bring forward the remaining promised 3.8 billion of funding allocated for Project Gigabit.
Ensuring the competitiveness of the UK innovation ecosystem.
We believe the UK is in a unique position to lead a revitalised global spirit of innovation, but to do so we must build on our current innovation ecosystem: helping businesses to invest in data for research and innovation by extending the scope of the R&D tax credit to cover key assets such as the purchasing of data sets and the use of data analytics and cloud computing. The Government should also act on long standing and cross industry calls to bring capital expenditure costs, such as those on plant and machinery for facilities engaging in R&D, within scope.
By taking the actions outlined in these four pillars the Treasury will set the UK off on a clear course for a strong economic recovery while laying the foundations for a longer-term plan based around enabling tech-led growth. One that not only helps the country rebound from the impacts of COVID-19, but to build back better with an economy set on stronger foundations than before.