Investing for the technical revolution ahead

In a budget speech that talked about the world being ‘on the brink of a technological revolution’, and that prepares the ground for the launch of the Modern Industrial Strategy by the Prime Minister on Monday, investment in new technology and skills was likely to be important in this budget statement.

From the tech perspective, much of what was announced had been expected. Investment in driverless cars, electric vehicles, AI, 5G and fibre broadband were confirmed, together with a number of initiatives to enable easier funding of tech start-ups. Investment in such areas is key to keeping Britain competitive in the new digital world; we see more and more member firms and businesses starting to use AI and robotics. ICAEW members still complain about poor connectivity, so improvements here will help.

Alongside this were a number of new initiatives to improve the skills of UK plc to cope with these new industries; much of this reflects discussions we have been having in the faculty and with LPD about necessary skills for the future. The Chancellor announced new initiatives to improve learning in maths and computer science, a new National Centre for Computing and, reflecting our call for life-long learning, an interesting collaboration between government, the CBI and TUC to help citizens to retrain with new digital skills (bearing in mind not all existing workers are going to be able to jump into new digital roles).

So good news on funding of tech and new skills, but there is still an issue with finding the right talent to fill vacancies now. At least there were additional announcements to help here, with more on housing, cheaper train fares for younger people, and additional funding for regions outside of London.

One other announcement later in the speech referred to VAT and keeping the current threshold at £85,000 for at least the next two years. This will have positive ramifications for the introduction of MTD, with VAT in the first wave. In our MTD Software Advisory Group we have been debating this issue, with concern expressed at mandatory filing of VAT returns being extended to smaller businesses earlier. At least this announcement gives some breathing space.

So in summary, much expected of the new digital economy and Britain’s place in it, allied with funding for new tech and skills to make it happen.

The budget speech is available here