Budget 2015: UK Tech Industry Mostly Unimpressed

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NEWS ANALYSIS: Tech firms lament lack of technology policy and support for startups, but sense opportunity in public sector cuts

Yesterday, Chancellor George Osborne delivered the first Conservative budget for nearly two decades.

A new living wage, welfare cuts and lower corporation tax rate were among the headline policies outlined, but there appeared to be precious little about technology in Osborne’s speech or the 120 page document.

We asked startups and tech firms about what they thought of the budget and what it meant for the technology industry as a whole.

James Norman, UK public sector CIO at EMC

osborne-budget-large“What came as a surprise, was the lack of focus on delivering digital services and transformative change. The sheer growth in digital citizen services has been astounding, but Government needs to accelerate its efforts to keep up with expectations of the ‘information generation.’ The delivery of smarter and more convenient online services in areas like healthcare, local government and tax, need to be a priority.

“Today’s announcement of the Next Generation Digital Economy Centres and schemes to bring together businesses, engineers and scientists to drive the commercialisation of technology, will lay the groundwork, but Government needs to invest more to support the development of online and digital services.”

Ed Relf, CEO of Laundrapp

“It was tumbleweed for technology start-ups in George Osborne’s Budget today. If the UK is to take further strides towards shaping the ‘sharing economy’ in Europe, entrepreneurs must receive further support from the Government. Tax incentives to support the purchasing of larger capital expenditure will go a long way to help entrepreneurs grow the on-demand ecosystem, offer more jobs and help the wider British economy remain one of the fastest growing in the world.

“Projects to support innovation across Britain, not just in London, are essential. By adding local ‘Enterprise Zones’ and boosting the annual investment allowance sounds promising for the growth of SMBs. This should also help form local innovation hubs to facilitate the nationwide expansion of both “sharing” and “on-demand” services.

“There also should have been a pledge on the continuing rollout of mobile 4G connectivity which still only covers approximately 55 percent of the UK as well as substantial speed increases from the average of around 15 Mbps and a continuation of the drop in 4G price plans.”

Mick Wayman, head of public sector at Vodafone UK

“It is clear that central and local government need to continue to find ways of performing more efficiently over the next five years, Public sector organisations will need to transform the way certain services are delivered and the way they work in order to find longer term, sustainable cost efficiencies. Technology can support and enable many of these necessary transformational changes – saving money while protecting and even improving public sector services.

“For example, Machine-to-Machine technologies can automate and improve services such as traffic management, energy management systems in council buildings and street lighting.

“But it isn’t just about efficiencies through automation.  An increasing number of public sector frontline workers such as community care workers and police officers have been using mobile technologies to improve the efficiency and quality of the services they provide.”

Julian David, techUK CEO

george osborne tech city engineering office“Whilst the headlines of the Budget may not offer up much on tech and digital, we look forward to seeing a greater focus on how digital technologies play a fundamental role in driving economic success right across the UK in the forthcoming ‘Productivity Plan’ led by Lord O’Neill.”

“Ambitions to increase the number of apprenticeships are to be applauded but Government must work closely with industry on implementation to ensure young people are trained for the jobs of the future.”

“There are a number of interesting announcements in the Budget document, including £23m for six ‘Next Generation Digital Economy Centres’ and seed funding for innovative business cases to deliver efficient public services fit for the digital age. The tech industry welcomes these initiatives and is eager to engage in making them a success.”

Elizabeth Kanter, ‎Director Government Relations and Public Policy, Global Corporate Affairs at SAP

“While elements of today’s Budget addressed the productivity issues faced by the UK, it was surprising that technology didn’t play a more prominent role considering the massive impact it can have in addressing this challenge. In particular, we would have welcomed further investment in the skills and technical resources required to realise the value of big data.

“Government can and should aim to be a leader at using its data assets to address public sector productivity, drive evidence-based policies and, importantly, deliver a more responsive public service. This will require the Government’s rich and varied data sources to be brought together and we look forward to the Government ‘Plan for Productivity’, which will be announced on Friday, in which we hope to see a greater focus on technology as part of the Government’s productivity plans.”

Richard Higgs, CEO of private cloud provider brightsolid

“Missing from yesterday’s budget was technology and, more importantly, the infrastructure required to help the UK get online.  While the Chancellor’s fuller policy paper gives a nod to digital, with investment in Next Generation Digital Economy Centres, without the right infrastructure in place the benefit will be limited.

“We congratulate the cities that have gained centres for the next generation digital economy but wish the government would make a similar commitment to connectivity for the whole of the UK, enabling significant productivity gains for every region; everywhere and everyone (and their devices) – it’s embarrassing that the city of Stockholm has more connectivity than the whole of Scotland put together.

“We love the new living wage and like the clampdown on aggressive tax avoidance. We also support the introduction of more skills apprenticeships. We have, for many years employed a social responsibility programme, including apprenticeships in our technical operating areas of business. Programmes like these have significant positive impacts both socially and economically.

“We are proud of our digital and gaming heritage here in Dundee and believe that university isn’t for everyone, but that everyone should have the opportunity to enter our industry to grow our already recognised digital economy here in Scotland.”

Askar Sheibani, CEO of telecoms repair and support firm Comtek

“Technology is a fundamental, high growth area for the UK economy, yet it was almost completely overlooked in the UK Summer Budget.  This industry is suffering from a potentially critical skills gap, and a generic apprenticeship levy will certainly not balance the labour market.  What’s more, as students are hit by the axing of the maintenance grant, this Budget may have done more harm than good for technological innovation in the UK.  The technology industry also has some of the highest R&D costs and, although R&D is critical to the progress of the UK economy, this has been essentially ignored by the Chancellor.

“Investment in skills, innovation and infrastructure was needed in the Budget, and none of these have been delivered.  Local communities, such as those in North East Wales, are in dire need of support to help them stabilise their own economic future; whether that be in terms of a skilled workforce, reliable broadband or an electrified rail line.  The Conservative Government seems to have disregarded this, however, which could prove costly for the UK’s economic prowess not only now, but long into the future.”

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