An economy with high wages, productivity and innovation must prioritise tech-led growth in the upcoming UK Budget and Spending Review, according to trade association TechUK.
The organisation outlined its vision for what chancellor Rishi Sunak should have in mind to realise the government’s vision for the post-Brexit economy. It noted that tech jobs account for 10% of total jobs in the UK, and cited the government’s own estimates that the current workforce could be bolstered with another 678,000 tech jobs by 2025.
Tech UK also noted that digitisation has significantly boosted the productivity of professions in areas such as HR, marketing and legal. Average yearly income within those areas is £62,500, which is significantly higher than the UK average, according to the association.
“The prime minister has outlined a vision of a new post-Brexit economic model for the UK, driven by high wages and high productivity,” said Julian David, chief executive at TechUK. “However, we will not be able to achieve that unless businesses, especially SMEs, can leverage the UK’s tech sector to adopt productivity boosting technologies and give staff the skills to use them.”
The association is calling on the government to focus on four key areas. In regulation, it recommends focusing on the expansion of sandboxing schemes, as well as the creation of new regulatory taskforces to unlock investment in technologies such as autonomous systems.
In relation to skills, the association is urging the chancellor to expand the Help to Grow: Digital scheme. In addition, it noted that the creation of a digital skills tax credit for small and medium-sized businesses would support businesses to adopt the digital services they need as well as to retrain staff.
Regarding infrastructure, TechUK recommends delivering commitments to roll out 5G and gigabit capable broadband. It is also calling on the government to invest a further £250m in the Telecoms Diversification Programme and deliver the remaining £3.8bn of funding it had pledged to allocate for Project Gigabit.
TechUK also wants the government to help businesses to invest in data for research and innovation. This would be done by extending the scope of the research and development (R&D) tax credit to cover assets required for R&D activity, such as the purchasing of data sets, as well as the use of data analytics and cloud computing.
Moreover, the association urged the Boris Johnson administration to “act on long-standing and cross-industry calls” to bring capital expenditure (capex) costs in areas such as plant and machinery for facilities engaging in R&D within the scope of the Budget and Spending Review.
“If we get this right, the prize is enormous – employees empowered by digital technologies contribute twice as much to UK growth,” TechUK’s David said.
“With salaries higher than the average and the ability to work anywhere across the UK’s nations and regions thanks to video conferencing and cloud technologies, digitising our businesses has huge potential to support the economic recovery from Covid-19 and levelling up,” he added.
In September 2021, chancellor Rishi Sunak told Computer Weekly about his plans to spearhead a HM Treasury initiative to reach out to leaders in the UK tech sector, such as CEOs, investors and startups, to better understand what the industry wants from the government in the post-Brexit world of “Global Britain”.
