Rishi Sunak must think critically about UK tech if he’s serious about growth
As the country faces the potential of the longest recession since records began, Rishi Sunak and his cabinet are going to have to think critically about how we can get back to growth in the UK.
But what does growth look like these days, and where does it come from? Having attended a recent seminar at the London Stock Exchange, I was struck by the statistic that the volume of Apple shares traded in a year is twice the amount of the entire LSE. Nearly all of the return in recent years has been from the top tech stocks in America. The reality is that growth reflects the modern economy, so technology has to play a key part in driving it.
The UK may not have rich oil reserves or infinite land mass, but we do have something extraordinary. We have a science base that I would argue is second to none, certainly for a country of our size.
Over the last 15 years we have done a good job at converting this rich science base, born out of brilliant universities, into start-up and scale-up businesses. But if we are to achieve the kind of growth that the country desperately needs, we need to produce (and keep) more very large technology businesses. We need UK-based, UK-centric tech companies employing skilled people, creating jobs and pulling in a supply chain here.
We have the special bit already. We created Deep Mind. We created Solexa, which became the basis of the genetic revolution. We’ve done a great job at fixing the early part of the pipeline, but we haven’t managed to create an environment in which those companies, or their investors, want to stay here. And that’s what the government must now focus on.
The way I see it is there are two key problems we need to consider. Firstly, we need to fix the London market. Lord Hill’s Review last year went some way in addressing these issues, but I think now is the time to be braver in our policies. For example, we should consider creating an explicitly branded index for high-growth tech companies in London.
Secondly, we must think differently about the regulatory frameworks that modern tech businesses are operating in. Now that we are free of the European regulatory burden, we have an opportunity to be more forward-thinking in our approach to regulations around driverless vehicles, AI and even modern medicine like the RNA technologies we saw emerge during the development of the Covid vaccines.
Our new government now has an opportunity to signpost where the UK is going and where growth will come from. We must signal to scientists, innovators, entrepreneurs and investors that, if you want to come and work on the latest advances in modern technology, we’re going to have the most advanced regulatory framework in the world. So come and do it here. We have the people, the universities and the science. Now we need a forward-thinking cabinet that is willing to be bold in their ambition to make the UK a Science Superpower. The country’s prosperity may well depend on it.
Dr Mike Lynch OBE FREng FRS