The UK Government's Autumn Budget did not contain any major announcements of relevance to the technology sector, but there were several developments that continue progress in existing digital policy.
Chancellor of the Exchequer Rachel Reeves has announced a further £300 million investment in NHS technology to “improve productivity, support staff and improve patient outcomes by driving the shift from analogue to digital”. The new funding is based on £10bn earmarked for digital spending as part of Spending Review 2025.
The money will be used for further development NHS app “ensure seamless navigation and communication between primary and secondary care” and “close the gap in patient access to digital health records.”
Budget documents say the government will “invest £59 million in new technology over the next five years to provide taxpayers with real-time digital guidance for VAT return software from April 2027 and corporation tax software from April 2028.”
The government will issue a “pre-market commitment” of up to £100 million to encourage investment in new artificial intelligence (AI) inference chips. AI was mentioned 59 times in Official document of the Treasury Red Bookexplaining in detail the measures included in the budget.
Growing tech companies will benefit from a package of tax changes that will help scaling companies attract investment and talent.
The Government said it was “significantly increasing” the limits on how companies can participate in the Enterprise Management Incentive Scheme to “enable large-scale companies to join start-ups and offer tax-advantaged shares to the talent they need to grow.”
The government is also increasing the limits of the Venture Capital and Enterprise Investment Scheme “to allow investors to continue operating as companies move beyond the start-up stage.”
red book highlighted planned implementation of a national digital ID scheme as an example of how government is investing in digital government services and supporting infrastructure. However, no new funding has been announced – only last week Digital Government and Data Minister Ian Murray told Parliament that ID Plan will be funded from existing budgets.
However Economic and financial prospects A report prepared by the Office for Budget Responsibility (OBR) to support the Budget found that the introduction of digital ID cards is forecast to cost £1.8 billion over the next three years, split between £500 million in operating costs and £1.3 billion in capital costs.
“The government has stated its intention to cover the cost of this from existing budgets, but no specific savings have yet been identified,” the OBR said. No further details have been provided on how the money will be spent.
Labor MP Chi Onwurah, chair of the House of Commons science, innovation and technology committee, welcomed the additional support for tech start-ups and large-scale projects but said she was disappointed by the lack of information about the proposed digital ID scheme.
“The OBR estimates the government's digital identity scheme will cost £1.8 billion over the next three years. This comes just a week after the digital government minister told the committee it was not yet possible to estimate the cost. Why were we told two different things?” she said.
“At a time of tight public finances, the OBR has also described the scheme as 'unfunded'. Given how important digital transformation of public services such as digital ID is to the government's agenda, the virtual lack of transparency and clarity about its costs and benefits is concerning.”
A Treasury statement said: “Despite a decade of damage and historic underinvestment under the previous government, which led to a £16 billion loss in productivity, the Chancellor has made clear she is determined to defy forecasts and lift the UK out of the cycle of decline through stability, investment and reform.”
