With the Budget 2017 almost upon us, Philip Salter, founder at The Entrepreneurs Network, discusses what UK tech entrepreneurs can expect from the government.
Tech industry leaders could be forgiven for scepticism towards Theresa May’s government. While her predecessor David Cameron courted technologists like Tony Blair wooed celebrities, up until a few weeks ago May steered clear of tech and entrepreneurs, neglecting all but the biggest of businesses.
That all changed last week, when May invited the great and the good from UK tech to Downing Street for the announcement of £21m of funding over four years to Tech City UK (soon to be rebranded as Tech Nation) and 1,000 additional Tech Nation Visas – though they will have to fight it out with other highly talented sectors.
On Wednesday, Philip Hammond will deliver his Budget. But, as always, a number of policies are being trailed in advance. Hammond is expected to announce: £75m for artificial intelligence; £76m to boost digital and construction skills; £100m to subsidise clean car purchases; £100m for an additional 8,000 fully-qualified computer science teachers supported by a new National Centre for Computing; £160m for next-generation 5G mobile networks; and £400m for electric car charge points. Now that calamitous advisers Nick Timothy and Fiona Hill have been booted out of 10 Downing Street, Cameronism is back on the menu.
Hammond will also announce a plan for driverless cars to be on UK roads within four years. As I argued in A Boost for British Businesses, which we produced with Sage for the incoming government, the UK could lead the way in innovation by ditching the precautionary principle in favour of an innovation principle.
In practice, I called for the sandboxes to be created in all emerging technologies, including drones, artificial intelligence (AI), driverless cars and 3-D printing. Relevant regulators or government departments would manage the sandbox, meaning entrepreneurs and regulators could be work together to overcome challenges.
What Firstminute Capital looks for in tech entrepreneurs
There are some bad ideas floating around that would damage tech. An otherwise sensible Times leader column calls for a turnover tax on big tech firms. As it happens, there are strong arguments for radical reforms – like the replacement of corporation tax with a border-adjusted system – but a sting on a select group of US tech giants is no way to build a tax system.
Cameron’s reverence for tech might be returning, but he will be remembered principally for his decision to grant his MPs a referendum and the Brexit vote. Seth Godin – author and former dot com entrepreneur – writes on his popular blog that before an organization invests in a new technology, a new machine or a new process, it needs to believe the world will be stable long enough to earn back the investment:
“That’s why a consistent, civil and stable government matters so much. And why industries often wait to leap into a new technology. Before there are any conversations at all about ROI, decision makers need to feel safe, safe enough to believe that there will a future that matches their expectation.”
This is arguably the thing the tech industry wants more than anything from Hammond on Wednesday: some reassurances over Brexit. Ultimately, government funding only gets us so far – success in the modern world requires ready access to people, property, capital, data, goods and services.
Hammond knows this, but the big question remains: Can he deliver?