Summer 2018 Remarks

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The following remarks were delivered by Alan Mak MP, Chairman of the All Party Parliamentary Group on the Fourth Industrial Revolution, and the Chancellor of the Exchequer, The Rt Hon Philip Hammond MP, at the APPG’s Summer Reception on 16 July 2018. You can find out more about that event by clicking here.

 

Alan Mak (introducing the Chancellor):

We’ve welcomed several thousand guests to parliament, to attend events examining a wide range of issues; we’ve ensured the 4IR has been at the heart of the Government’s new Industrial Strategy; we’ve seen a growing number of parliamentary colleagues join us, and I’m delighted to see so many colleagues from both houses here today. We’ve enjoyed significant support from the cabinet, and the shadow cabinet, and we’ve partnered with businesses at the cutting edge of innovation and investment.

I’m also delighted that Klaus Schwab, the Chair of the World Economic Forum, has become our first patron, ensuring we’re connected to global developments in this important area. I also want to take a moment today to thank our sponsors, who’ve supported us over our first year: HSBC, Microsoft, Deloitte, Braintree, Lockheed Martin, Boston Consulting Group, HPE, Lyceum Capital, Korn Ferry, Sky Betting & Gaming and Creative England. I also want to welcome today some of our new sponsors: RBS NatWest, Uber, Samsung, Vodafone, Oracle, and Tata Consultancy Services. Without your support, the APPG couldn’t exist, and wouldn’t be so successful. And if you’re interested in supporting us, please do contact me; we’ve got a great list of names you can join.

Over the next year, the group is going to be active. We’re going to continue to be the focal point of all aspects of the Fourth Industrial Revolution here in Westminster, and beyond, raising awareness of its policy implications, holding events, and helping MPs and peers build stronger connections with business and industry. And as we go about this important work in the months and years ahead, I’m delighted to have the strongest support, from the very highest levels of government, and our guest of honour today, an entrepreneur himself, has been a powerful voice for Britain’s leadership of the Fourth Industrial Revolutuion.

He’s also been a strong voice for the potential that emerging technologies have for boosting our productivity. So I’m grateful that one of our strongest supporters in government, the Chancellor, has made time to support us here again today, for the second year in a row. And I hope you’ll join me in welcoming him in the usual way.

Philip Hammond:

Thank you Alan, it’s a great pleasure to be back here a year later, after being here with you to launch the APPG, and to hear an update on what you’ve achieved during the course of the year and of course your plans for the year ahead. This is one of the more exciting APPGs and you’ve certainly captured the imagination of colleagues across both houses, and all parties in Parliament with this agenda.

We’re always talking about the productivity challenge in the UK and I think that we all understand that it’s hard, raising productivity is the key to higher living standards and higher real wages and I’ve always been very clear with my colleagues about this one important metric: the way to a contented and satisfied population is continuously rising real wages coupled with job security and making sure that as our economy goes forward in the future, post-Brexit, we are able to maintain continuously rising real wages is absolutely key.

The tech revolution enables Britain, now, to leap ahead in the productivity stakes. We’ve been behind many of our peers for a number of years, but we are in a very advantageous position in relation to the technologies of the Fourth Industrial Revolution. I’ve said it before and I’m going to say it again: I genuinely believe that this is the first time in my lifetime that we’ve gone into a period of intensive technology change with the UK being in the lead in many of the key industrial areas. Not just producing, through discovery and invention in our research institutes and our brilliant universities, the new technologies, but this time actually seeing them developed and exploited here in the UK. Not just seeing the technologies, the IP, being exported around the world, as we’ve seen so often before, but seeing capital, talent, people coming into the UK to develop the technologies here, and we’re seeing, not just in London but across the UK, Cambridge, Oxford, Manchester, Bristol, hubs of technological excellence growing up which will allow us to play a key role in developing and delivering these technologies to the market.

The UK is a world leader in financial services, a world leader in Fintech, we have a world leading health service, and we’ve become a world leader in the life sciences – and the merger of life sciences with computing technologies is one of the most exciting and stimulating areas of uptake in the Fourth Industrial Revolution. So I see a bright future for the UK, through the advocacy, the uptake and the promotion and development of technology here in the UK, and I see an opportunity for us, through a step change in the delivery of technology, to gain a productivity advantage against our competitors, who for so long have outpaced us in that sphere.

Now I don’t always welcome waking up in the morning to seeing newspaper articles telling me what I must do in order to achieve some wonderful objective, but this morning, when I read ‘Philip Hammond must make Britain the best place in the world to start a tech firm’, I thought ‘Yes, I can agree with that, I don’t have any problems signing up to this agenda’.

As I said, we have got the world’s leading financial centre, a global tech hub, the world’s legal and regulatory jurisdiction of choice, world-class centres of academic excellence and talent and innovation, and I think some of that is demonstrated here today. But that won’t be enough to keep us at the cutting edge – future success isn’t ours by right and the Government understands that we need to support what’s going on across the tech sector, in order to ensure that the UK remains in the forefront of this technological revolution and British businesses and British workers benefit from its application.

So, what are we doing to comply with Alan’s injunction in the Times this morning?

We’re supporting entrepreneurship, to ensure that industries of the future can get off the ground here in the UK; investing in research and development, a commitment to the largest increase in public R&D spending in three decades as part of our broader ambition to raise R&D investment in the UK across the economy to 2.4% of GDP; we’re ensuring that start-ups can access the finance that they need to become scale-ups; we’re creating an environment in which innovation can flourish, instructing our regulators to support and foster innovation, as well as their more usual precautionary roles.

And we are putting our money where our mouth is; we’re investing £640 million in artificial intelligence, over £1.7 billion in autonomous and ultra-low emission vehicles. We’ve set a target for full fibre to 15 million premises by 2025, with full nationwide rollout by 2033, and we’ll use the full range of tools available to government including announcing a date for copper switch-off, probably the single biggest stimulus we can give to investment in fibre. And in the budget last autumn, I launched a plan to unlock over £20 billion of patient capital for the UK’s most innovative firms to grow to scale here in the UK, shutting off, hopefully, one of the remaining important drains from the UK where companies do begin exploiting their technologies here but find they’re unable to source the capital required to grow to scale here in the UK. I want to see UK unicorns, over the next decade, on the back of this commitment to patient capital.

But of course, government can only pave the way, can only create a more favourable environment for innovation and technological change. It’s something more intangible that actually delivers the kind of buzz that has made London and the UK the tech capital that it is. Somebody from Silicon Valley put it to me, I thought, rather well: ‘Silicon Valley is a brilliant place, but it is a monoculture; London and the UK is a pluri-culture, and developing technologies – new technologies – in a pluri-culture is so much more stimulating, and so much more dynamic than doing it in a monoculture environment’. I am confident the UK has the right environment in place, and we will go on making that environment more and more attractive for tech entrepreneurs. But we are under no illusion that it is the tech entrepreneurs coming here, being incentivised to take risks here, finding this an attractive environment in which to operate, that will deliver these opportunities for the UK to seize in the years and decades ahead.

And that’s why the APPG is so important, as a conduit between industry, and government and parliament, making sure that not just in government, but in the opposition parties, across the backbenches, there is a wide understanding of the needs of entrepreneurs. If we are going to ensure that they establish their businesses and build their futures here in the UK, rather than going to any of the other jurisdictions around the world, which are extremely anxious to recruit them. I can’t tell you how many times I visit a country where my counterpart tells me that ‘we have ones of the world’s leading hubs of x, y and z’, and when I check with my people, they reassure me that actually they’re nowhere close to what we have in the UK. Let’s keep it that way – let’s make sure that the UK remains the world’s most attractive place to start and grow a tech business and let’s build a new prosperity for the British people on the back of that commitment. Alan, thank you.

Alan Mak:

Thank you very much, Chancellor, for your remarks, and thank you for showing your strong and continued support for APPG on the Fourth Industrial Revolution.

You’ve set an extremely positive vision for our economy in the future, powered by emerging technologies, with rising productivity, growing living standards and stronger economic growth so thank you for your continued support and we look forward to working with you over the months and years ahead.

I also want to take this opportunity to thank my fellow officers on the APPG for their hard work over the last 18 months; Peter Kyle, Stephen Kinnock, Kevin Hollinrake, Nigel Huddleston, Matt Warman, Lord Willetts and Lord Holmes, and I also want to thank HSBC for their generous support for today’s reception – it does continue until 2:45 so please do take some time to meet our exhibitors, our start-ups and our entrepreneurs in the room today, and please join me in thanking the chancellor in the usual way for his support.

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