Budget 2020: technology, infrastructure and innovation
12 March 2020: while there was little on technology itself in Rishi Sunak’s first Budget speech, there was plenty in the accompanying report. Head of ICAEW Technology Faculty Richard Anning picks over the details.
Perhaps the biggest takeaway from Rishi Sunak’s first Budget is the size of the extra £175bn infrastructure spending over the next five years. With the Chancellor proclaiming “if the country needs it, we will build it”, there was a £5bn commitment to invest in gigabit-enabled broadband, with 4G expected to reach 95% of the country by 2025 (do you remember the various party election promises made at the end of last year?!). This investment is vital for an increasingly digital-based economy, with a number of ICAEW members still complaining about poor broadband, albeit mainly now in rural areas.
There was also a desire expressed to “unleash the power of business” with a raft of measures to help smaller businesses, many of which are the tech start-ups that the UK is so successful at growing. With talk of investing in the ‘tech of the future’, there was an increase of R&D investment to £22bn per year by 2024-25, which will be aimed at science and technologies ranging from nuclear fusion to electric vehicles and life sciences, with full details to be published in the upcoming spending review.
More money is being made available for education. This includes investment in STEM subjects with a commitment to build eight new Institutes of Technology and 11 maths schools. It is good to see a continuing commitment to education in these subjects, but there is a shortage of tech skills now, particularly in data analytics and cyber.
There are a number of other interesting tech-related points included in the Budget Report.
- The Digital Services Tax is still due to come into force in April 2020, despite ongoing issues in other regions.
- There is reference to an upcoming consultation on the broader regulatory approach to cryptoassets.
- The government is investing in additional compliance officers and new technology for HMRC, both of which are planned to reduce the tax gap.
- HM Treasury will shortly be publishing a call for evidence to ask what more could be done by the government, industry and regulators to support a more innovative and resilient payments system and ensure the UK payments sector remains world leading.
- Finally, the government will publish an evaluation of the introduction of Making Tax Digital for VAT, along with related research.
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