The UK’s Digital Strategy Briefing July 2022
Connect. Support. Grow.
What is it? The UK’s Digital Strategy is a cross Government strategy which sets out the Government’s agenda for Digital Policy. It focuses on 6 key areas: 1. 2. 3. 4. 5. 6.
Digital Foundations Ideas and intellectual property Digital skills and talent Financing digital growth Spreading prosperity and levelling up Enhancing the UK’s place in the world
Key points of the Strategy 1) Digital Foundations The Government’s goal is to ensure everyone in the UK has connectivity in a world reliant on digital technologies. The Government aims to achieve at least 85% gigabit coverage by 2025 and 99% gigabit coverage by 2030. The UK is also making significant progress in rolling out wireless connectivity; 92% of the UK landmass is currently covered by a good 4G signal. The Government’s ambition is that the majority of the population will have access to a 5G signal by 2027, with the Department for Culture, Media and Sport (DCMS) investing significantly, to the tune of £200million, into UK telecoms innovation. The Government is also investing £250million into R&D in the hope of delivering a more diverse 5G supply chain, ensuring the security and resilience of networks across the UK and delivering upon the Government’s 5G Diversification Strategy. In response to technological innovation, the Government has stated plans to adopt a more flexible, outcomes-based approach for technology-neutral regulatory regimes and has also committed to legislating for Smart Data. Forthcoming legislation is expected to create a legal gateway, allowing public bodies to share data with organisations that follow the rules of the UK Digital Identity and Attributes Trust framework to validate a person’s identity. The Government is also determined to ensure that the UK’s technological and digital security is defended from threats and that highly sensitive technological intellectual property (IP) is protected. To keep the UK’s digital systems, platforms and infrastructure secure, the Government plans to invest £2.6billion over 3 years, which will include a £114million increase in funding for the National Cyber Programme. The Government is also looking to support businesses online and is analysing feedback from a recently concluded public consultation on proposals to strengthen cyber resilience. The Government is also providing free advice on how to protect against cyber breaches and attacks through the Cyber Aware programme and will continue promoting the Cyber Essentials standard to increase organisational resilience. 2) Ideas and Intellectual Property The Government has stated intentions to increase investment into research and development (R&D) substantially, (up from £15 billion to £20 billion a year between 2020/21 and 2024/25). This combined with enhanced R&D tax incentives to stimulate private investment, will deliver greater levels of innovation which the Government hopes will see digital businesses thrive. The Government is increasing funding for the Higher Education Innovation Funding programme by £250million and funding a University Commercialisation and Innovation Policy Evidence Unit to build evidence on commercialisation.
The strategy seeks to grow the UK’s existing expertise in the foundational deep technologies of the future, such as artificial intelligence, next generation semiconductors, digital twins, autonomous systems and quantum computing. The Government will consider increasing the generosity of the Research and Development Expenditure Credit (RDEC) scheme to boost R&D investment in the UK. Furthermore, the Government is planning to publish a Creative Industries Sector Vision in the summer of 2022, aiming to unlock the potential of this highly innovative sector. Creative sector businesses often require strong digital skills in order to produce content and use highly technical design software. The NHS is looking to promote innovation through initiatives and programmes such as the NHS AI Lab which supports safe, ethical and effective adoption of AI in health and care; it has also committed over £100 million to accelerate testing and evaluation of over 80 AI technologies. Furthermore, a joint funding package of up to £200 million between NHS England, DHSC and BEIS was announced, for the NHS to support data-driven research and innovation. 3) Skills and Talent The Government is looking to encourage students to uptake GCSE and A Level Computer Science. The Department for Education (DfE) has expressed intentions to support schools to deliver computing alongside a full range of subjects over the course of a week. It has also been stated that DCMS will support the National Centre for Computing Education (NCCE) to strengthen its links to digital employers and wider industry through the Digital Skills Council. The DfE want to ensure to all T Level students have the opportunities required to develop key skills and workplace experience, through the delivery of 15,000 industry placements by 2024/2025. The DfE is planning to invest an additional £750 million over the next 3 financial years to support teaching and facilities in higher education, and planning to provide £450 million in capital funding to invest in teaching and learning facilities which meet the Government’s priorities. DfE is also looking to update the National Careers Service website to become a single source of Government-assured careers information. The Government is aiming to encourage more apprenticeship levy transfers amongst larger employers, making it easier to find other employers who want to take on apprentices. The Government are also looking to make it easier for SMEs to benefit from levy transfers. It is hoped that this may contribute to up- and re- skilling talented individuals with digital skills. The Government are also introducing the new High Potential Individual and Scale-up visas, so that UK digital businesses can easily recruit from anywhere in the world. 4) Financing Digital Growth The Government wants to encourage UK investors to increasingly take a long-term view to investment in digital growth. The Government will continue to directly support innovation and growth financing through UK Innovate Edge and the British Business Bank’s initiatives and will seek to use these to maximise investment by third-party financial institutions in the UK and internationally. The government will also continue to promote the London Stock Exchange (LSE) as the best place for our digital technology firms to list. 5) Spreading Prosperity The Government hopes to enable better access to the benefits of digital technologies across the whole of the UK, improving productivity by funding the adoption of cutting-edge technologies by
businesses in every region. The Government is committed to working with the devolved Governments to ensure the benefits of digital are felt across the UK. This Government has invested in providing skills for the existing workforce and for future generations, with the aim of ensuring that all can share in the success of the digital economy. The Government is also looking to bolster the Help to Grow: Management scheme which aims to support 30,000 SMEs to digitally transform their business model over the lifetime of the programme. Help to Grow: Digital is expected to support up to 100,000 businesses. This scheme helps small and medium-sized UK businesses find and adopt digital technologies to improve their productivity. More can be found here. The Government has additionally announced £2.6 billion of localised funding through the UK Shared Prosperity Fund (UKSPF). The Government is also investing into infrastructure to improve connectivity and plans to work closely with the devolved Governments, ensuring the benefits of digital technology are felt throughout the UK. The Government has also stated plans to continue to support local digital projects through providing access to digital skills training, boosting opportunities for investment, and creating more digital jobs. 6) Enhancing the UK’s place in the world The Government will continue to work with allies across the world, to develop systems of trade and governance that promote global digital trade. The Government states that it will look to promote digital exports and ensure that new free trade agreements have a digital chapter. There will be a cross-Government effort to promote inward investment into UK technology and UK VC funds by focusing on target geographies, such as the Middle East, the Asia-Pacific region and North America. The forthcoming International Tech Strategy will set a common set of democratic principles to frame the UK’s international engagement on technologies. The UK will also look to play a leading role in international fora - both multilateral and multistakeholder, ensuring openness, freedom and a multi-stakeholder approach underpin global technology Governance. The Government will also seek to develop partnerships countries around the world on matters that benefit from supranational cooperation, such as R&D projects and semiconductor supply-chain resilience. How does this impact Greater Birmingham Businesses? Current Outlook The need to be a digitally strong region is profound. According to the Lloyds Consumer Digital Index 2021, digital exclusion places individuals at a significant disadvantage, and around 30% of residents in the West Midlands have a very low level of digital engagement; this is compared to 28% of England. Similarly, 8.6% of the population in Birmingham was classified as ‘digitally excluded’ in 2020, as noted in the Breaking Down Barriers report from Digital Birmingham. The importance of this cannot be understated as it is indicative of a skills deficit within the region; if more people are digitally excluded or have low digital engagement, fewer people have the capability to work confidently in a digital age, undermining the productivity of businesses across Greater Birmingham. Analysis from the Chamber’s Quarterly Business Report (QBR) shows how 65% of businesses attempted to hire staff and of those, 69% faced recruitment difficulties in Q2 Q2022 - one of the highest figures on record in the 30-year history of the report. This further highlights the need to
match supply with demand; difficulties in recruitment suggests a need to ensure skills development is a constant priority, of which digital skills is a key component. Impact The efforts made by the Government to ensure digital skills are at the forefront of skills development are hugely beneficial to the region. Supporting the proportion of the population who are currently digitally excluded to access opportunities associated with digital technologies is crucial to the regional economy, opening up more avenues to address the skills shortages that employers are currently facing. Greater Birmingham is aiming to become a hub for digital sectors. The Digital Tech Sector Census from the Data City highlights the significant progress being made in this respect, with Birmingham being in the top 6 cities across the UK for the Digital Sector. It becomes vitally important that Greater Birmingham makes use of the Government’s commitment to investing into digital infrastructure to raise productivity levels and remain competitive with other core cities as an attractive place to start, grow, move or invest in a business. How can the chamber support businesses across Greater Birmingham looking to invest in digital skills? This briefing is part of the Chamber’s Future in Technology (FIT) campaign, which aims to support business investment in digitisation and the adoption of new technologies. Click here for further information on FIT. The campaign will feature the publication of a range of briefing papers and expert videos on topics including the Government’s Digital Strategy and what it means for businesses, investment in digital infrastructure in Greater Birmingham, cyber security and more. The Chamber has a variety of support options available to assist businesses. The Chamber’s ChamberLink Daily e-newsletter goes out to 14,000 business contacts across the region daily, providing the latest local business news, insights and tips that are of significant value to businesses. The GBCC Policy Team exists to research business views on economic indicators and key challenges they are facing, inform businesses of new policy or legislative changes which may impact them, facilitate the sharing of best practice ideas between local organisations, and engage stakeholders on issues faced by the business community in order to shape effective policy decision making. Resources produced by the team include this briefing, as part of the Future in Technology campaign, as well as briefings on topics such as International Trade, Sustainability and Skills. The GBCC are also part of a WMCA-area bid to deliver a Local Skills Improvement Plan (LSIP) on behalf of the Department for Education and have proposed that this focusses on digital skills. To ensure that you receive further information and updates on local digital skills provision as soon as they are available – as well as updates on the broader work of the Chamber and its members register to receive the ChamberLink Daily Enewsletter here.
For more information, please contact: Kuranpal Singh Policy Advisor K.Singh@birmingham-chamber.com Greater Birmingham Chambers of Commerce
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