Chancellor Philip Hammond delivered his Autumn Statement today. Here’s a roundup of the key points that are most relevant to small tech companies in the UK.
Hammond noted the importance of the UK tech sector and laid out plans to provide support specifically to this industry. He pledged:
- Additional investment in R&D, with an extra £2bn per year by 2020-21 to “ensure the next generation of discoveries is made, developed and produced in Britain”. This is part of a new National Productivity Investment Fund of £23bn to be spent on innovation and infrastructure over the next five years.
- £390m to go towards the development of low emission vehicles and connected autonomous vehicles.
- An additional £400m for venture capital funds through the British Business Bank, unlocking £1bn of new finance “to prevent our fastest growing technology firms being snapped up by bigger companies, rather than growing to scale”.
- A treasury-led review of the barriers faced by innovative firms in accessing “patient capital” (long-term investment) in the UK.
He also announced measures to help British business in general, including:
- Doubling UK Export Finance capacity to make it easier for British businesses to export their goods and services.
- Funding for the initiative being headed by chairman of the UK Commission for Employment and Skills, Charlie Mayfield, that aims to determine how management skills can be improved across British businesses.
- Plans to drive economic performance of cities across the UK, with: £1.8bn to English regions: £556m to Local Enterprise Partnerships (LEPs) in the North of England, £542m to the Midlands and East of England, and £683m to LEPs in the South West, South East and London.
- Adherence to the business tax roadmap set out in March, with corporation tax being cut to 17%.
- Implementation of the business rates reduction package, with the transitional relief cap being reduced from 45% to 43% in 2017, and from 50% to 32% the year after.
While there is a concentration of tech talent in London, there are numerous towns and cities across the UK with growing tech communities. These should benefit from the chancellor’s measures relating to transport and infrastructure. He pledged:
- £110m of funding for East West Rail, and a commitment to deliver the new Oxford to Cambridge Expressway to create a “transformational tech-corridor”, connecting the research strengths of the two universities.
- Funding for the evaluation study for the Midlands Rail hub.
- Investing £450m to trial digital signalling on railways to improve reliability on the rail network.
- The Department for Transport will work with Transport for the North to develop options for Northern Powerhouse Rail.
Many areas of the UK suffer from poor broadband connectivity, which, aside from being frustrating for individual users, is disastrous for tech companies. The chancellor pledged to make the UK a world leader in 5G, with:
- Over £1bn for the UK’s digital infrastructure to encourage private investment in fibre networks and 5G trials.
- From April, the introduction of 100% business rates relief for a five-year period on new fibre infrastructure, supporting further roll out of fibre to homes and businesses.
The full budget speech can be found on the government website. Find out how the tech community feels about the announcements made today in our article Autumn Statement 2016: UK tech entrepreneurs respond to govt plans to boost sector.