In his budget speech, the Chancellor, Jeremy Hunt, announced he wanted to harness "British ingenuity to make us a science and technology superpower."
Announcements included an "AI sandbox" to boost support for artificial intelligence businesses in the UK and a recommitment to a UK "quantum strategy" for the future of computing.
Mr Hunt confirmed there would be 12 new investment zones, strongly emphasising tech innovation. Plus, in a bid to tackle the labour shortages, he unveiled apprenticeships aimed at the over-fifties and broader incentives to support working parents, disabled people, and those over fifty who want to remain in, or return to work.
AI, quantum computing, and investment zones
On the AI and the quantum strategy Jeremy Hunt said the government was accepting all of Sir Patrick Vallance's recommendations including a core BCS recommendation that sandboxes be established to create a “safe space” to work with regulators on innovation: "We will launch an AI sandbox to trial new, faster approaches to help innovators get cutting edge products to market, work at pace with the Intellectual Property Office to provide clarity on IP rules so generative AI companies can access the material they need,” he said.
He added: "Because AI needs computing horsepower, I today commit around £900m of funding to implement the recommendations in the independent Future of Compute Review for an Exascale supercomputer. The power that AI's complex algorithms need can also be provided by quantum computing…. So today we publish a quantum strategy which will set our vision to be a world-leading quantum enabled economy by 2033 with a research and innovation programme totalling £2.5 billion."
He announced a prize worth £1m every year for the next ten years "to the person or team that does the most ground-breaking AI research".
The new investment zones in England will be in the West Midlands, Greater Manchester, the North East, South Yorkshire, West Yorkshire, East Midlands, Teesside, and Liverpool. There will also be at least one investment zone in Scotland, Wales and Northern Ireland.
Each English investment zone can access £80 million of support for tax breaks, grant funding and incentives over five years.
Tackling the labour shortage
The Chancellor announced a phased in plan so that by September 2025, eligible parents will be able to access 30 hours of free childcare for all under-5s from when maternity care ends.
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For the over-fifties, the government offered apprenticeships, which he called “Returnships" that could run alongside skills boot camps and sector-based work academies.
He also abolished the lifetime allowance limit on pensions, which he believed would incentivise "our most experienced and productive workers to stay in work for longer".
The government will also increase the number of over-fifties Universal Credit claimants who receive “mid-life MOTs” from 8,000 to 40,000 a year.
Budget for growth
The Chancellor announced that a three-year policy of "full expensing" for businesses that would mean for every pound a company invests in IT equipment, plant or machinery could be deducted "in full and immediately" from taxable profits, a move worth £9 billion a year.
Mr Hunt also said he wants to reform the regulations around medicines and medical technologies. He announced an extra £10 million of funding over the next two years to implement "the quickest, simplest, regulatory approval in the world."
Responding to the budget BCS CEO Rashik Parmar said: “Investing in areas such as AI and quantum computing shows the government is listening to industry and supporting these sectors to achieve our economic potential.
"The next step is to build public trust in these emerging fields by growing the numbers of skilled, ethical technology professionals who work in and lead them.
"Potentially the new investment zones could do much to boost tech research and development and we look forward to seeing the full details.
"We also hope that extending childcare and providing incentives for the over fifties to return or remain in work will do much to alleviate the gender and pay gaps that affect our sector."