My Tech Sector Wishlist for the 2020 Budget
Yiannis Faf is co-founder of the crowdfunding gift app WhatWeWant, which he created alongside his family to allow users raise funds for an upcoming event for themselves, or someone else.
The pressure is on Rishi Sunak to deliver the Budget 2020. I, like many tech sector professionals, have a set list of priorities, which I believe the government must address, if we are to see the UK’s tech sector thrive in post-Brexit Britain.
Bridging the gap: developing our digital skills
The UK is currently facing a gaping digital skills gap and has been for over a decade. What is worrying, however, is the fact that the government has yet to take any decisive action to bridge said gap.
There has been a plethora of reports on the matter, all of which raise important points. Within the most recent report on the subject, published in June 2019, Margot James issued a call to action to improve the UK’s provisions to meet a growing demand for digital skills.
The report went on to offer encouraging propositions, which would ensure that businesses across all sectors are hiring the digitally skilled employees that they need in order to grow. That said, we are yet to see any of these suggestions materialise.
So, it is vital that the Chancellor offer a concrete plan to address the skills gap and commit more resources towards developing tech education in the UK. Without it, the UK has no hope in inspiring the next generation of digital entrepreneurs.
Invest in Cyber Security
It is inevitable that, as our technology advances as an unprecedented rate, so do cyber security threats. Indeed, the threat to businesses and consumers alike is high, and so investment in cyber security has never been more crucial.
Whilst the government released plans to invest £36m in cybersecurity as recently as October 2019 in order to combat cybercrime, I believe more could be done. Projects such as the Digital Security by Design initiative should remain a prime focus in the new budget, and continual research should go some way to ensure that the UK remains protected from breeches in cyber security.
Improving our digital infrastructure
The UK appears to be a breeding-ground for technological innovation, with 3,000-5,000 start-ups in London alone. However, therein lies the problem; the vast majority of tech start-ups are based in London. To me, this highlights a desperate need to improve the UK’s digital infrastructure.
Although the Conservatives have vowed to achieve 100% full-fibre broadband coverage throughout the UK by 2025, there are doubts as to whether this is possible. After all, broadband sector advocates have warned that time is of the essence if Boris Johnson wants to deliver on this promise in six years’ time. This will hardly come as welcome news to budding tech entrepreneurs based in Allerdale, Cumbria - an area renowned for having one of the slowest broadband speeds in the UK
Therefore, I believe that investing in the UK’s digital infrastructure should be a pressing matter with the release of the new budget. Such action will undoubtedly boost digital connectivity across the UK and enable start-ups to grow outside of the capital. After all, innovative ideas for new businesses should not be quashed, simply because someone does not wish to relocate to London.
Clarity regarding Entrepreneurs’ relief
Perhaps the most controversial point of discussion in the lead up to the Budget is purported reforms to the government’s Entrepreneurs’ Relief scheme. Rumours are rife as to whether the relief might be cut, or worse yet, abolished, so that the government can increase spending on public services.
Whilst I understand the case for re-evaluating the scheme, I believe that the relief offers a key incentive for budding tech entrepreneurs to start up new business ventures. If abolished, home-grown tech firms would find it more difficult to get their feet off the ground.
As the co-founder of a tech company, it is apparent to me that the relief is a necessary aid to spur entrepreneurs on as they face the unavoidable financial hardships of launching a tech start up. Without it, the financial risk could prove too great for some, and consequently, the UK could lose out on some game-changing tech innovations.
I would suggest that even greater support yet for entrepreneurs is needed for the tech sector and the economy at large to flourish, especially amid the political uncertainty of Brexit. I would therefore hope that the Chancellor offers greater clarity surrounding plans to reform the scheme in the new budget. What’s more, if the relief were to be abolished, I hope he offers suitable incentives to facilitate the future growth of the UK’s tech sector.
Mitigating the changes to immigration policy
Following the proposal of a new points-based immigration system in January 2021, things are set for it to become much more difficult for EU tech founders to launch their start-ups in the UK.
A recent report report has highlighted the UK Tech sectors’ dependence on immigration. Indeed, of the UK’s 14 ‘unicorn’ start-ups (businesses worth upwards of £770m), 9 owe their success to at least one foreign-born co-founder. Additionally, a huge 49% of the fastest-growing British start-ups have immigrant founders, of which 42% are EU-born.
Currently, the part of the government’s criteria specifies the need for visa applicants to have a formal job offer from an “approved company” at an “appropriate skill level”; this could prove troublesome for tech entrepreneurs hoping to build a start-up in the UK, given the minimal likelihood that their businesses will be registered on the governments “approved” companies list.
The question now, is whether the skillset of tech entrepreneurs will be enough to receive a visa? This is a point the Chancellor must clarify in next week’s budget. I, and I assume my colleagues within the tech sector, would like to see Sunak’s budget speech shed some more light as to what measures are in place to ensure that tech firms have access to new talent, so that the UK remains a frontrunner for innovation.
Of course, I realise that announcements made by the Chancellor on 11th March will take some time to implement; and then, it is likely that we will need to wait at least five years before we see any measurable results. However, it would be an encouraging, and indeed reassuring, to see the government investing more in the digital economy upon which we are becoming increasingly dependent.