Keeping to a tight budget

As expected there were no big giveaways from Alistair Darling in this year’s budget. Whilst it was nowhere near as drastic as the recent second Irish budget in which taxes were hiked and budgets were slashed, the Chancellor gave a keen sense that the UK is battening down the hatches to weather the economic storm. But it was not all doom and gloom, and indeed there were plenty of positive points for the technology industry to take. So was this the first ‘Technology Budget’?

From what was said in today’s budget and the intentions laid out in Lord Mandelson’s ‘New Industry, New Jobs’ paper launched on Monday it’s clear government is positioning the high-tech industries as drivers of future growth and job creation in the UK.

There were several points in the budget which we welcome in particular.

We welcome action on STEM (Science, Technology, Engineering, Maths) skills that underpin the knowledge economy; we welcome action on trade credit insurance that will help local electronics and electrical retailers; we welcome the action to fill in the remaining gaps in broadband provision; we also welcome the new Strategic Investment Fund: all these are part of the picture of the UK’s future. We also welcome the temporary increase in First Year Capital Allowances, which we called for in our ‘Helping Innovation Flourish’ paper, to encourage business investment, including in telecommunications.

But significant areas of blank canvas remain. Next Generation Broadband, the crucial new infrastructure demand of the 21^st century so far, is given some necessary but nowhere near sufficient help. The case for a public private partnership on the 3i model is put out for review, at a time when high-tech start-ups, who could be the engines of future growth, risk perishing in the cold economic climate for lack of venture and risk capital. In both of these cases the time for reviews is all but over and the time for action is now.

By Daniel Smyth, PR and Public Affairs Executive