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Hammond delivers tech-positive Spring Statement

Delivering his Spring Statement, the chancellor bangs the drum for UK tech businesses, confirms £25m for 5G testbeds, allocates full-fibre funding and highlights the need for digital skills

Lis Evenstad
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Published: 13 Mar 2018 19:15

Chancellor Philip Hammond has reiterated the government’s commitment to 5G funding, full-fibre broadband, T-levels and digital skills in the Spring Statement. 

Hammond’s statement highlighted the government’s plans to “keep Britain at the forefront of new technologies”, and said the government is committed to ensuring the country remains a digital leader.

“Our tech sector is attracting skills and capital from the four corners of the earth, with a new tech business being founded somewhere in the UK every hour, producing world-class products including apps like Transferwise and Citymapper,” he said.

He added the country needs to “embrace the technologies of the future”, but also develop the “skills we will need to benefit from them”.

In October 2017, the government announced a T-level in digital will be among the first three technical qualifications the UK is introducing to increase technical education.  

Hammond said that from April onwards, £50m will “be available to help employers prepare for the roll-out of T-level placements”.

Commenting on the announcement, techUK CEO Julian David said the trade body supports the funding. 

"T-levels can have a positive impact on improving digital skills. However, they won’t be successful unless businesses of all sizes have the capacity to engage effectively in their delivery," he said. 

Connectivity plans

The chancellor also used the spring statement to reiterate the government’s commitment to 5G, confirming £25m from the National Productivity Investment Fund (NPIF) will be used for a series of 5G testbeds. 

Last week, the government announced that six small and medium-sized enterprise (SME) lead projects from all over the UK will each receive a slice of a £41m kitty – including the £25m from the NPIF, to explore the benefits of 5G for rural communities, tourism and healthcare across the public and private sectors. 

The spring statement also allocated the first wave of full-fibre rollout funding, covering £95m for 13 areas across the country, as part of the £190m for broadband through the Industrial Strategy Challenge Fund announced in the Autumn Budget.

Areas successful in receiving funding include Blackpool, Cambridgeshire and Coventry. The government expects the next wave of the fund to open this summer.

The statement also set out plans to ensure the tax system is fair on digital businesses, ensuring that “corporate tax rules respond to the modernisation of the economy and deliver appropriate results for digital businesses that generate value in unique ways”.

Read more about full-fibre broadband

Commenting on the plans, Chas Roy-Chowdhury, head of tax at the Association of Chartered Certified Accountants (ACCA), said the government needs to “exercise careful judgement when it comes to potential tax changes on digital businesses”.

“Measures aimed at tackling perceived tax avoidance by the big tech firms could easily impact on much smaller digital firms’ competitiveness and investment,” he said. “Any effective digital taxation system must be built on a multi-lateral framework and align with the latest OECD work on the digital economy.”

Hammond also announced the government is seeking views on how it can support people and businesses who use digital payments. 

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