Thursday, March 7, 2024 5:54 a.m.
“We are on track to become the world’s next Silicon Valley,” Prime Minister Jeremy Hunt declared in his spring budget announcement on Wednesday.
The budget reveals key policies for the UK tech industry, including a 2p cut to National Insurance and the introduction of the UK ISA, as well as increased funding for artificial intelligence (AI) and a £360m research and development package. Ta.
But some technology company chiefs are feeling discouraged, especially as the UK remains behind rival global leaders such as the US, China and Singapore.
Steve Hare, chief executive of FTSE 100 software company Sage, said the £7.4m AI Upskilling Fund pilot, aimed at helping small and medium-sized businesses (SMBs) develop AI skills, was a “starting point”. He said that.
“However, the government has missed an opportunity to fully support SMEs in their digitalization efforts and introduce measures such as e-invoicing and tax incentives to improve investment in digital technologies.” he said.
“We welcome the Prime Minister’s ambition to transform the UK into the next Silicon Valley, but this dream will not become a reality unless we have a fully digital economy that all businesses can benefit from,” Hare said. added.
The Budget also includes a previously announced £360m package to support research and development in sectors such as life sciences, automotive and aerospace.
But Lewis Liu, head of Aigen Technologies, said the government had decided not to reverse cuts to the UK’s “once world-leading” R&D tax credit scheme that startups had hoped for. “I was disappointed,” he said.
“These cuts are acting as a tax on founders, already damaging the UK’s successful tech ecosystem that provides investment and well-paid jobs, and are set to make the UK a technology and science leader by 2030. “This is seriously undermining the government’s ambitions to become a superpower,” he said.
Mr Hunt also said the government would double funding for the Alan Turing Institute, adding an extra £100m over the next five years, with around £800m going to the public sector to boost Britain’s declining productivity levels. The total amount will be used to expand the use of AI, he said.
“But this alone is not enough,” says Alan Kay, co-founder and managing director of Vespertec, a UK-based data center infrastructure specialist. “We need to consider investing in the infrastructure needed to support the growth of AI as we strive to become the world’s next Silicon Valley,” he added.
“This includes servers and modern GPU architectures, as well as a network of data centers that are well-equipped to handle the huge power budgets and heat dissipation associated with AI.
“By investing in our own talent, the Government can ensure we have the right systems in place to make the most of advances in this area and keep the UK at the forefront. We need to ensure that this is reflected in government action, but the actions taken so far have not gone far enough,” Mr Kaye said.
It was expected that the Chancellor would reverse changes to angel investor rules, but Mr Hunt’s Budget speech did not provide further details.
Raising income thresholds for the wealthy could infuriate investors and limit support for small and medium-sized businesses, particularly those led by women, those from minority backgrounds and those located outside London.