5 things we learnt from Audley’s roundtable with Darren Jones MP on the future of UK tech policy
What do we need from tech public policy over the next ten years to help the sector become a global leader? Here are Audley’s 5 key takeaways from our roundtable with Darren Jones MP.
Amid a global economic downturn, the trajectory of the tech sector in London has taken a hit. While the strength of UK tech was much celebrated at London Tech Week, with government ministers out in force to woo industry, questions still remain unanswered about how we can cement London as the tech capital of the world.
To address these points, Audley hosted a roundtable with Darren Jones MP, the Labour MP for Bristol North West and Chair of the House of Commons Business and Trade Select Committee, together with representatives from fintech, life sciences and cyber businesses.
With the context of London Tech Week and the recent report from techUK about how the next government can better support the sector, the roundtable discussion explored what the next decade of technology public policy looks like and what government should be doing differently.
Here’s what we learnt:
1. For all the talk, tech still does not top the government’s agenda.
While the government is on a charm offensive with the tech industry and international governments alike, in the corridors of Westminster tech is not even in the top five priorities of parliamentarians.
In the past five years, the government has started to wake up to the opportunities of future technologies and responded to recent warnings about the existential threat of technologies like artificial intelligence. However, Mr Jones pointed out the competency gap that still exists among parliamentarians. This is hindering government from grasping and responding to issues meaningfully in real-time and the recent AI White Paper, which was out of date by the time it was published, is a stark example of this.
While there is much debate over tech at a regulatory level, there is an absence of a coherent strategy to help the UK leverage its tech sector. This is, in part, a result of the political cycle that is focused on quick-win announcements and policy papers that may make a good headline, but often fail to have an impact. Mr Jones said that Labour would be outlining its own policies this year and would be putting tech at the heart of its agenda. Indeed, during his remarks at London Tech Week, Labour Leader Sir Keir Starmer said his intention was to put tech at the heart of achieving his ‘Five Missions’ for government.
2. The UK is not the gold standard for regulation and there must be greater scrutiny of regulators.
Tech sector representatives who attended the roundtable voiced concerns about current regulation, which is making the UK an unattractive destination for businesses and investors. Some cited the lack of clarity on certain rules caused by decisions made by the Competition and Markets Authority (CMA), the lack of accountability and regular scrutiny of regulators, and unclear guidance which has left businesses confused over compliance questions. Uncertainty about how the CMA and other regulators will act can often put off international investors looking to deploy capital into UK tech.
As a House of Commons Committee chair himself, Mr Jones argued that Select Committees needed to do more to hold regulators accountable, but a lack of capacity and resources is holding them back. Mr Jones said that his Committee alone has over 40 independent regulatory bodies to scrutinise, which makes it very difficult to bring bodies regularly to Parliament to provide evidence. There is a cross-party consensus that there needs to be a new committee with specialist resourcing to address this and thereby give Parliament more of a proactive role when investigating the work of regulators, rather than the current situation where regulators are only questioned after something goes wrong.
3. National security is a key driver in tech regulation and greater clarity is needed.
The US and China have entered a new phase of competition for technological advantage, triggering a wave of legislation across Europe to protect the West’s national security and economic interests. The National Security and Investment Act (NSI), which was brought into force last year, gives the government powers to review relevant deals that take place on the grounds of national security, and is the UK’s answer to the US’s Committee on Foreign Investment (CFIUS). With these new powers to intervene, there is a growing need for greater clarity from government on the scope of the Act and support to help businesses navigate this legislation. As we heard from tech leaders around the table, there is significant uncertainty over whether an investment falls within the 17 sensitive areas of the economy that require mandatory notification and the definitions of technologies like AI are broad. More specific guidance would give businesses the confidence they need to invest in the UK without fear of a deal unravelling.
4. Businesses risk being stuck in the ‘Valley of Death’ or tempted stateside.
Despite world-class universities, the success of seed investment schemes and progress on R&D funding, British companies are finding themselves in the ‘Valley of Death’ (a period where they need a significant investment to survive). Unless you are a big enough company and can leverage your position with senior government figures directly, there are not enough avenues for businesses to receive specialised support.
With American investors increasingly making attractive offers to promising British businesses, Mr Jones spoke about the need for government to start thinking seriously about what products are missing on the shelf to keep businesses British and ensure the returns on investment are enjoyed in the UK, not elsewhere. He said there needs to be an industrial policy that addresses the issues businesses care about. Unlocking private capital is a key part of that, but it also needs to cover skills and talent and regulation. One of Labour’s priorities will be addressing this funding gap with policies such as Shadow Chancellor Rachel Reeves’ plan to create a £50bn growth fund to deploy capital into fast-growing businesses and to look at compelling pension funds to invest more in scaling British companies.
5. We must flip the narrative on tech from fear to hope and opportunity.
If the UK is to become a destination where world-class tech companies are born and raised, this is a mission that the country must get behind – not just the government. Mr Jones said that consumers are concerned that new technology will take their jobs and businesses are wary about adopting new technology for fear of making expensive mistakes. He argued that politicians and the private sector need to work harder to flip this narrative from one of fear to one of hope and opportunity, and couple this with better digital infrastructure in the public sector. This will help open people’s eyes to technologies that have the potential to increase their standard of living, help businesses grow, and improve public services. Alongside this culture change and a new narrative, Mr Jones spoke about working more collaboratively with tech companies to scale up access to services and put tech at the heart of the productivity agenda.
By Lucy Thompson, Senior Associate at Audley.
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