Rumours that the prime minister may pull the plug on the HS2 link connecting Birmingham to Manchester has created fierce backlash among business leaders. Scrapping it would be a huge step backwards for the UK tech sector at a time when momentum has been building across regional hubs.
While I’ve never been a huge fan of HS2, I fear we are now too far down the track – excuse the pun – to stop this major infrastructure project, even if the costs have escalated.
There may have been a time to reconsider HS2 but that time is certainly not now.
I recently wrote to the prime minister to explain why I’ve come to feel this way, and more importantly what it means for the tech sector.
As a leader who represents the West Midlands tech community, I know how important transport is to ensuring businesses can operate in a timely and efficient manner.
In fact, I fundamentally believe that HS2 being scrapped would slow down, or even reverse the progress we’ve made. It would also do untold damage to our global reputation and ability to attract international tech companies to the region – at a time when our region tops regional rankings for foreign investment and has seen the highest growth in the UK.
In 2021 and 2022, we were recognised by the UK government as the fastest-growing tech sector in the UK. In fact, last year alone we added £3.8bn to the local digital economy.
The region’s thriving digital industries are expected to create 52,000 new jobs and add £2.7bn to the economy by the end of 2025. Last year tech jobs across the region increased by 31% and since 2020 more than 2,300 startups that have collectively raised more than £1bn in venture capital funding. Last year, the West Midlands tech sector was valued at a record £15.3bn.
With all this in mind, I believe the completion of HS2 would help maintain this momentum, and likely even accelerate it, with tech businesses able to get faster access to investment, opportunities and international firms.
Furthermore, effectively linking London, Birmingham and Manchester would create an important tech spine throughout the UK. This connectivity would supercharge tech collaboration and help make the UK a global tech superpower – something that Prime Minister Rishi Sunak and the government are keen to establish.
No time to backtrack
Of course, this isn’t all about the tech sector. Further scaling back HS2 would cause untold damage to the construction sector and the UK economy as a whole. HS2 has already invested £23bn into its supply chain (including significant tech investment), providing jobs and certainty for a construction sector that accounts for 9% of the UK’s GDP and 7% of its employment.
Furthermore, this is a sector that itself is going through digital transformation, something which would no doubt be affected.
The rail transportation sector itself is using digital technology and hardware like never before. This is mainly through partnerships with innovative startups that supply drones, IoT technology, big data platforms, AI modelling, green tech solutions and augmented reality devices.
These organisations would no doubt be affected by a full or partial scrapping of HS2. With tech startups being such a vital part of the UK economy, we shouldn’t be holding them back with indecisiveness.
HS2 might seem to many to just be a major rail project, but what it symbolises is so much more. It signifies our ambition and ability to finish large-scale initiatives, our investment in technology and infrastructure, and our vision to create a connected Britain – one that creates shared prosperity locally and tells the world we are open for business.
My hope is that the prime minister, the chancellor and all those involved in the decision-making will honour their commitment to the project and not backtrack (there I go again) on this landmark plan to create a tech-enabled and interconnected UK.
At a time when tech and levelling up are key government priorities, it’s important investments in large-scale infrastructure projects like HS2 are maintained.
Failure to do so would send the entirely wrong message at a time when the opposite is very much needed.