Laying the foundations for a better Britain. That was the strapline of Philip Hammond’s Autumn Statement yesterday. And while he coughed up the figures on Brexit, which to date have come to £700m in negotiations and has a further £3bn set aside, he also shed a lot of light on the action plan for the UK’s tech industry and a commitment to invest in it’s growth.
We’re ‘on the brink of a technological revolution’ says Hammond, and it looks like the future of the UK is set to support this. According to the stats, one new tech business is created every hour, and they want this scaled to every 30 minutes. We were all ears and this is the plan.
The guys at Tech City UK are getting a big chunk of investment along with their re-brand to Tech Nation. It’s great news, with a big investment of £21m over the next 4 years in a supporting effort to secure the UK’s world leading position in digital innovation.
Tech Nation will be utilising this by expanding their reach to support regional tech startups by launching a dedicated sector programme for the leading tech verticals like AI and FinTech. The hubs will be based in: Cambridge, Bristol and Bath, Manchester, Newcastle, Leeds and Sheffield, Reading, Birmingham, Edinburgh and Glasgow, Belfast and Cardiff.
Increase in EIS
A big cheer from investors and startups alike as we further incentivise investment into British tech. This move will see a doubling in the annual allowance for people investing in knowledge-intensive companies through EIS and the annual investment those companies can receive through EIS and the Venture Capital Trust scheme.
Furthermore, there will be a new test to reduce the scope for and re-direct low-risk investment, together unlocking over £7bn of growth investment.
A big addition to attracting overseas investment will come through the Department of International Trade, who will be expected to unlock £1bn of overseas investment in UK VCs.
(if you want to know more about this or look to apply for EIS – email email@example.com)
Increase in R&D
Another boost for R&D! Good news for most tech startups and another step towards that goal of increasing R&D to 2.4% of GDP by 2027. Hammond confirmed that they’re taking the total direct R&D spending to £12.5bn per annum by 2021-22. That’s a £2.3bn increase of additional spending since the 2016 Autumn Statement.
How will this play into tech startups? The increase in R&D spend will result in an increase in the rate of the R&D expenditure credit from 11% to 12% with effect from 1 January 2018. To further provide businesses with the confidence to make R&D investment decisions, the government will also introduce a new Advanced Clearance Service for R&D expenditure credit claims for up to three years prior to filing.
(if you would like to know more about R&D and see if your company qualifies – email firstname.lastname@example.org)
In light of the increased support and investment to R&D in the UK, the government is changing immigration rules and encouraging top talent in research and science to work in the UK. This comes in three forms:
- Enable scientists and researchers endorsed under the Tier 1 (Exceptional Talent) route to apply for settlement after three years;
- Make it quicker for highly-skilled students to apply to work in the UK after finishing their degrees;
- Allowing UK research councils and other select organisations to sponsor researchers, reducing the red tape surrounding international hires.
The Future of Vehicles
The driving force of the budget focused on the advancement of driverless car technology. With a predicted industry worth of £2bn to the UK economy, employing 27,000 people, the government are backing driverless R&D hard.
With an aim to see fully self-driving cars, without a human operator, on UK roads by 2021, Britain will be making changes to the regulatory framework in order to nurture the R&D, including areas in how the cars can be tested without a human safety operator.
Ultra-low Emission Vehicles
In a big push to support the transition to zero emission vehicles, the government will be raising £400m of investment (£200m from private investment) for a Charging Investment Infrastructure Fund. This will see a wider roll-out of charging infrastructure which will include £4m invested in charging R&D, a commitment to electrify 25% of the government’s central fleet by 2022 and a launch of a new innovation prize to determine how future road building should adapt to support self-driving cars (by the NIC).
An additional £10m will also be provided to guarantee the continuation of the Plug-In Car Grant to 2020 to help consumers with the cost of purchasing a new battery electric vehicle.
A world-first advisory body, the Centre for Data Ethics and Innovation, will work with government, regulators and industry to lay the foundations for AI adoption. Estimates suggest this could benefit households across the UK by up to £2,300 per year by 2030, by enabling and ensuring safe, ethical and ground-breaking innovation in AI and data-driven technologies.
To aid this and secure the UK’s leading position in the global AI market, the government will be creating new AI fellowships to initially fund 450 PhD researchers working on AI advancement.
Up to £2m of R&D NPIF funding is being invested over 3 years for a GovTech Fund, starting in 2018-19. Access will be given to public bodies to support procurement of innovative products through the Small Business Research Initiative (SBRI), run by Innovate UK.
Please subscribe to our newsletter to get more monthly updates in news, events and essential reads in the tech startup industry