It’s no secret that UK prime minister Rishi Sunak has been on a tech offensive of late — with the self-confessed Silicon Valley acolyte recently launching the world’s first ever global AI safety summit and greenlighting the UK’s re-entry into the EU’s Horizon 2020 research programme.
So many in the country’s tech community had high hopes for a raft of measures to support British tech companies and startups to be announced in chancellor Jeremy Hunt’s Autumn Statement delivered on Wednesday, ranging from support for green technologies to more investment in regional research and development hubs.
Here’s what the UK’s finance chief announced today that affects startups.
£4.5bn for manufacturing
Hunt announced a new fund to back manufacturing in the UK — as many high-growth companies are opening operations in the US due to financial incentives from the country’s Inflation Reduction Act. £4.5bn will be made available to invest across eight sectors that the government deems “key to economic growth”, with a particular focus on green technologies.
£960m of that fund is being ring-fenced for a “green industries growth accelerator”, for investment into renewable energy and carbon capture. £500m will go to life sciences and £2bn will go to the automotive sector.
Foreign investment
Hunt announced a “concierge service” for large international investors, to make it easier for large overseas funds to direct their capital into the UK. He said this would be modelled on the best services offered by other countries.
Pension funds
The budget also included reforms to pension funds — with Hunt saying he’ll support the establishment of new investment vehicles for pension funds, including a new growth fund run by the British Business Bank. Hunt said that this could unlock £75bn by 2030.
Hardware
Hunt bigged up the UK’s tech sector, calling it the third largest in the world. He said that AI will “be at the heart” of future growth. Hunt announced £500m over the next two years to invest in supercomputer centres for the AI sector.
Support for R&D and loss-making businesses
Hunt announced he would combine existing R&D tax credit and SME schemes, adding that loss-making businesses within these schemes would be taxed at 19%, down from 25%.
He also announced that £5m will be given to Imperial College, in partnership with the NHS, to back the “next generation of world-changing innovations” in medicine.
£50m for apprenticeships
Hunt announced £50m for apprenticeships in engineering and other “key growth sectors” where there are talent shortages. The move could help tech companies bring in subsidised junior talent, bringing down costs of hiring for less-skilled roles.
12 new investment zones
Hunt said that the government will establish “12 mini Canary Wharfs” around the UK — areas around the country that will benefit from different economic regulations that encourage investment into the private sector. He said this would “catalyse £3bn of private investment” and create 65k jobs.
Payments to small businesses
Hunt announced new measures to make sure small businesses get paid on time, introducing a condition that any company bidding for large government contracts should demonstrate they pay invoices within an average of 55 days. This builds on the recently passed Procurement Act, which mandates 30-day payments of invoices throughout the subcontractor supply chain.
