Summer Statement ‘a missed opportunity’ for tech sector

The chancellor’s Summer Statement has been called a “missed opportunity” to support the UK’s tech sector through the Coronavirus recession.

Rishi Sunak signalled the country’s move to phase two of the economic recovery, with a specific focus on protecting employment and boosting job creation, while phase three will concentrate on rebuilding the economy more comprehensively and is likely to come during the full autumn budget statement.

The new Plan for Jobs should go some way to temper the growing furlough ‘bubble’, with as many as 9.3 million jobs at risk once the scheme comes to an end in October. However, the government will need to find other routes to create jobs, with tech leaders encouraging entrepreneurialism and equipping the unemployed with the business skills to get a business up and running via the apprenticeship levy.

Sabby Gill, managing director at Sage UK and Ireland, commented that more needs to be done to boost innovation and digitalisation as ways to return to growth.

“The chancellor has made for a strong summer of ‘bricks and burgers’ but the absence of a great digital led growth agenda was a missed opportunity to accelerate a plan for all seasons.

“The government has failed to grasp the inspiring power of opportunity – without a strong package of measures to stimulate entrepreneurship, such as incentives for digital investment, British SMEs stand exposed to future crises and a potential second wave despite the bold steps they are taking to fight back,” he continued, adding: “SMEs require urgent action and cannot wait until the Autumn Statement, when many are fighting for survival at this moment.”

Gill called on the government to help prepare tech firms for Brexit, along with funding for regional export strategies and an extension to the new Export Academy for tech sectors to other sectors with propensity to export more.

“Businesses’ moves to recovery depends on access to the technology that will underpin a successful recovery – immediate support to invest in technology will improve productivity and create jobs in the long term,” he added, suggesting digital vouchers or grants, linking loan repayment relief on existing schemes to technology investment “or allowing them to claim a reduction against their tax bill of 200 per cent of the value of the investment”.

Franz Doerr, founder and chief executive of flatfair, commented: "For a mini-budget that was meant to unveil the government's thinking about how to both protect and create jobs from the economic headwinds caused by COVID-19, it's surprising that the chancellor did not feel the need to elaborate on any further support for the UK's tech sector.

"The UK's tech sector has been booming over the last few years, and to not support it now during this time would risk erasing years of growth and job creation,” he said, adding: "Post-pandemic, the UK's tech sector has the ability to play a key role in helping revive our economy through fostering innovation and creating jobs – making sure it comes through this crisis in the best shape possible is vital."

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