[sws_grey_box box_size="690"]SUMMARY - With a UK general election looming, TechUK wants to see some big changes made to foster the digital economy, but makes some big assumptions and claims en route. [/sws_grey_box]
While all political attention in the UK at present is directed on Thursday’s independence vote for Scotland, whatever the outcome there will be life after the referendum, not least the rapidly approaching General Election in May next year to choose a new national government.
That election is on the minds of TechUK, the tech trade lobby group, that today publishes a manifesto for a Digital Economy with specific demands and requests for whatever political hue of party gets into power next year.
Before looking at the detail, I must admit to some curiosity about the choice of timing for releasing this manifesto. As I said above, for the rest of this week there is no other item on the domestic political agenda than Scotland so the risk of not getting enough attention runs high. Of course, if the Scots vote yes to splitting up the Union that will remain the case right up to the General Election and beyond so maybe it is best to get it out the door now.
So what’s on the to-do list for the next government from the tech industry’s point of view? Well, some new job titles for a start as TechUK calls for at least one minister with dedicated digital responsibility in every government department, a new Chief Privacy Officer and a new Foreign and Commonwealth Digital Trade Tsar to support a target of doubling UK tech exports by 2020.There should also be a dedicated digital economy minister in the Cabinet, the inner circle of UK political decision making. The manifesto reads:
The next government should ensure there is cabinet-level leadership to develop and execute a single digital strategy that rolls up the digital economy, digitalisation of government and digital inclusion. Other systemically important policy domains have a clear departmental lead and a strong voice at the Cabinet table - it is time the full significance of digital is recognised in the same way.
Sounds like a good idea, if a tad optimistic in terms of civil service resistance to the idea of more experts coming in and knowing what they're talking about in technology terms.
That said, the UK has lacked a proper IT minister since Mrs Thatcher did away with the last incumbent in her first term in office. But if it is to be a politician in the role, then make sure he or she understands the brief and isn’t going to need to learn on the job.
Alongside this comes:
- A ‘smart migration’ policy to help high-growth companies tap into the world’s best talent, focusing on post-study and graduate entrepreneur visas alongside measures to strengthen the pipeline of home grown skills.
- Ten-year innovation budgets that extend beyond parliamentary cycles, as a platform for long term growth.
- ‘Digital-trust-by-default’ across the public and private sector, with a commitment to free speech on the web and a clear legal framework for government surveillance.
- Ensuring jobs and growth beyond the South East of England and doubling the digital participation of SMEs across all industries.
- A digital inclusion programme to ensure that everyone has basic online skills by 2020.
The Tech City factor
The current Conservative-Liberal Democratic coalition that holds power in the UK has focused a great deal of attention on the Tech City zone in East London which is intended to act as a hub for start-ups and innovation as well as a base for the likes of Google. TechUK’s manifesto praises the efforts made, but wants a more nationwide set of priorities rather than something so London-centric.
TechUK chief executive Julian David told the BBC this morning:
That all makes a lot of sense, but in order for regional tech hubs to emerge there needs to be a lot more focus on things like tax breaks to encourage inward investment. On this front, while Tech City and Cambridge can both be held up as examples of good practice and good progress, other European Union countries, most notably Ireland, have done a far, far better job at getting US tech firms to set up shop.
You've got to make sure the UK becomes a hub for digital skills…We've got fantastic capability in clusters around the country. When you look at places like Cambridge, there's a pattern of success there for growing digitally-focused, very large, very successful companies such as [chip maker] Arm Holdings.
Turning to emergeing markets, the areas of growth opportunities seen by TechUK include:
- Internet of Things (expected to reach $7.3tn by 2017). Wearable technology (expected to reach $70bn by 2024).
- Big data and data analytics (expected to reach $32.4bn by 2017).
- 5G and associated new wireless technologies (expecting a 40-fold increase by 2018).
- Robotics (expected to reach $29bn by 2018).
- Autonomous vehicles (expected to be a £28 billion market by 2020).
- Advanced manufacturing, building automation (expected to reach $49.5 billion by 2018.
Curiously for a manifesto setting out to affirm the UK’s leadership role as a technology hub, all the predicted market sizes are measured in US dollars!
OK, that’s what the market research firms will have pumped out, but surely someone could have sat down with a calculator and done a currency conversion? This manifesto is all about Britain and Britain’s future and Britain’s economy, so some pound sterling market scoping might have been in order perhaps?
Still at least the predictions aren’t in Euros - which brings us to Brussels. With the UK’s uncertain future in Europe set to be one of the defining issues at the next General Election, TechUK’s manifesto tackles this troubled relationship from a technology angle.
Some of this comes in highly commendable intentions. For example, this one gets my vote straight away:
Proposals that fail to create a platform for the development of growth and jobs - such as the proposed General Data Protection Regulation - should be resisted and modified to ensure they support innovation whilst effectively empowering consumers.
But then there are other aspects that have a hollow ring of ludicrous self-importance and naiveté, such as:
The next government must commit to driving the development of the European Digital Single Market, shaping it in the image of the world’s leading internet economy - the UK…the UK should be leading, not following, negotiations on the completion of the European Digital Single Market.
At a time when those in the corridors of power in Brussels regard the UK as a right royal pain in the proverbial, the idea that the Eurocrats will be interested in using the UK as a model - or regarding it as the world’s leading internet economy for that matter! - seems as likely as the US government bowing down the European Commission’s sense of self-importance.
(The claim seems to be based on the idea of UK having an online ecommerce market accounting for 8.3% of GDP in 2010 compared to the G20 average of 4.1%!)
The rise of the right
Then there’s that other political hot potato - immigration. Everyone agrees that the UK has a tech skills shortage and almost everyone agrees that the long term solution is to ‘grow our own’. So policies such as introducing coding to the school curriculum are clearly a welcome development and one that politician of any party is going to resist.Less politically appealing might be the idea of importing the necessary skills from other countries. TechUK calls it ‘smart migration’; politicians in areas of the UK with high levels of unemployment or with already high levels of immigrant populations may not see it as smart politics.
Specifically, the manifesto calls for:
- A two year Post Study Work visa.
- Removal of caps on graduate entrepreneur visas.
- Removal of the higher salary threshold from Tier 2 skilled migrant visas (upper cap (£40k)).
- Extending the Tier 1 Exceptional Talent Visa beyond start ups and increase scale and reach across the UK.
This is the proverbial rock and hard place position. Decade upon decade of neglect by both Conservative and Labour administrations have led to the dearth of necessary technology skills. The UK needs to import them as a short term solution.
TechUK argues the case:
One in seven start-ups in the UK was founded by a migrant54. The UK must be able to attract the wealth creators and skills necessary to fill existing skills gaps and help create the jobs of the future. This requires a smart migration policy that makes the UK attractive to wealth creators and skilled workers.
Recent changes to immigration policy are making it much harder for the tech sector to access the global skills base and making thebUK much less attractive to global talent and entrepreneurship.
To be a global hub for tech we must have a smart immigration policy that is open to and welcomes entrepreneurs and future wealth creators; developers and engineers with key skills; students and researchers who can keep our universities at the forefront of academic excellence; and teachers who can inspire and educate the next generation.
They’re right. Completely and utterly. Basic common sense.But at a time when UKIP is on the rise in the UK (and the anti-immigration parties right across Europe are on the move), common sense is going to have a fight on its hands.
Finally, there’s the shameless plea for the supplier community. TechUK represents suppliers of all sizes, including all the leading members of the ‘oligopoly’ that has been so demonised by the government for the past 3 or 4 years. With the government committed to growing SMB participation in public sector business, there has been a tangible sense of resentment building in some of the largest suppliers.
The stance taken by TechUK in its manifesto is one that preaches a level playing field:
Make contracting with the public sector easier for all suppliers, regardless of size, so that Government can draw upon the widest supplier base possible. This will enable government to take advantage of the capabilities of companies large and small, and tax payers don’t have to bear the additional costs of overly complex procurement processes.
Or in other words, let’s lose the oligopoly confrontationalism! That’s probably a good idea as the once amusing oligopoly mantra has become increasingly shrill and unattractive. But there can be no question of ‘business as before’ for the big suppliers. Those days are gone and must remain so.
There’s some stuff to love in this. There’s some stuff to think about a bit more. And there’s some stuff that just made me laugh out loud at either its pomposity or its naiveté.
There will be a debate among politicians this evening at which doubtless many reassuring words will be spoken, political promises made and the vital importance of investing in the digital economy reiterated by all parties.
That’s fine, it’s all to the good to have these topics on the political agenda for discussion and debate. But in the end, none of this really matters until we wake up next May to find out who’s going to be responsible for spending our money on trying to put some of it into practice.
And if things go wrong on Thursday, there will be bigger political fish to fry in any case.