Response to the Chancellor’s Autumn Statement
The focus of the Autumn Statement was primarily about fixing the nation’s finances, but there were some announcements from the Chancellor that are important for the science and technology sector.
I was pleased to hear Mr Hunt refer to Britain’s “national genius for innovation”. He is absolutely right to call the UK a Science Superpower – it’s a label we should use far more often than we do. We shouldn’t underestimate the world-leading science base we have in this country. It was reassuring to hear the Chancellor point to science and technology as an engine for future growth and his belief that the government should focus on support for the sector.
Nevertheless, plans to scale back R&D tax credits widely used by Britain’s leading tech and biotech start-ups is cause for concern. Now is not the time to make tax relief on R&D less generous. If we want the UK to continue leading the way when it comes to pioneering research into things like AI, driverless vehicles, and personalised medicine, we must not limit these companies’ ability to attract investment, hire skilled workers and scale.
Despite media speculation, I was, however, pleased to see that research and development funding will not be cut. On the contrary, the pledge to increase it so it will reach £20bn by 2025 is critical if we are to get back to growth in the UK. Stimulating business, and importantly technology businesses that reflect the modern economy, will be key to navigating the country out of the recession we now face.
For the taxpayer to reap the benefit of this funding, we will need to see new technologies translate into commercial successes. This has been a comparative weakness of Britain. The Solvency II reforms will help get capital into scaling businesses, but I would have liked to hear more from the Chancellor about other regulatory changes that will give the tech startup ecosystem more of a boost. My thoughts on what policies the government should consider are here.
Dr Mike Lynch OBE FREng FRS