Hammond said that his budget, which he proposes to be the last ever spring Budget to be delivered by government, will prepare Britain for a “brighter future” and a “strong and stable” platform for Brexit negotiations.
The engineering and technology sectors have welcomed the news of £270 million to be delivered in 2017/18 from the Industrial Strategy Challenge Fund. This will be allocated to ‘disruptive technologies,’ including “cutting-edge artificial intelligence and robotics systems that will operate in extreme and hazardous environments, including off-shore energy, nuclear energy, space and deep mining.”
Professor Dame Ann Dowling, president of the Royal Academy of Engineering, said that the fund will help enable “effective collaboration between industry and academia” and create a “significant competitive advantage from the UK’s world-leading research” in a range of areas in engineering and science, from artificial intelligence and robots to batteries for electric cars and novel medicines.
In an additional boost to the digital technology sector, government will set up a £16 million 5G technology hub to support the increasing demand for high-speed internet applications and keep pace with developments being made in 5G technology around the world.
Dr Li-Ke Huang, who works in 5G research and technology at Cobham Wireless, said that 5G would be vital to support a “truly connected society” powered by applications such as machine-to-machine communication, connected cars and smart cities.
The technology would also help fix various “not spots” across the country, such as commuter rail lines and large parts of rural Britain, which are lacking sufficient connectivity and hindering the growth of the wider UK economy, said Huang.
“The proposed government investment will help position the UK as a leader in 5G R&D, and provide the nation with a head start in the consequent race to bring the benefits of this technology to consumers and businesses,” he added.
In a further attempt to make the UK a global technology leader, Hammond said that despite government deciding that its R&D tax credit regime is “globally competitive” it will cut administrative burdens around the scheme.
Taavi Madiberk, chief executive of high voltage ultracapacitor and supercapacitor company Skeleton Technologies, said that while investment for technology was welcome that to make a true impact all European governments should reconsider their approach.
He claimed that investment for technology is often focused on research and development, but instead it should be focused on “supporting developments closer to market, allowing technologies to become mainstream”.
“One example of this is the US Department of Energy’s huge investment in Tesla, helping to create a global business, and bringing electric vehicles into mainstream consciousness,” added Madiberk.
Support for oil and gas but not renewables
Hammond also set out the government's intention to support the North Sea oil and gas industry and provide further support of transfer “of late life assets”. “As production declines it is absolutely essential we maximise exploitation of remaining reserves and will publish formal discussion paper on the options in due course,” said Hammond.
While the support will be welcomed by the ailing oil and gas sector, some renewable energy organisations have called out Hammond on the absence of support for green technology in the Budget.
The Solar Trade Association (STA) highlighted the failure from Hammond to drop business rate hikes of up to 800% on organisations using their own rooftop solar. The STA “is concerned for 44,000 solar microgenerators, who are currently exempt from business rates, and who face a nasty shock from April”.
There was further disappointment expressed by STA that the long term price signals investors need through the Carbon Floor Price has been deferred to Autumn. “Moreover, there was nothing in the Treasury announcement on replacing the levy control framework that gives desperately needed clarity to solar power which has been shut out from competitive access to wholesale markets,” added STA.
Support for skills and training
To tackle the fact that “too many young people leaving school without skills needed for the labour market”, Hammond has announced a renewed focus on technical training and skills. This includes £300 million of funding for 1,000 new PhD placements and a pledge of £500 million per year for the creation of education reforms including ‘T-levels’ – an alternative qualification to the more academically focused A-levels that covers 15 technical topics, from agriculture to digital, engineering and manufacturing and transport and logistics.
Stephen Dyson, head of industry 4.0 at Proto Labs, said the introduction of tailored, technical alternative qualifications was welcome and “long overdue”.
“By providing the next generation with dedicated career options and the ability to engage in bespoke technical training courses, Britain is better positioned to take serious action towards plugging the country’s skills shortage,” added Dyson.
However, Dr Sarah Main at the Campaign for Science and Engineering (CaSE) stressed that government must work in consort to enable the plans for T-levels and new PhDs to “really fly”.
“…it will be important to ensure the reforms are sufficiently resourced, seen to completion, and aligned with the industrial strategy in order to deliver on that hope,” Main added.
In regards to the new PhD positions, Main also stressed that government must ensure its immigration policy “works in harmony” to attract international talent.
Peter Finegold, head of education and skills at the Institution of Mechanical Engineers, said that while the T-levels are welcome “the challenge remains how to attract young people and their parents to the value of technical training” in the first place.
Finegold suggested that for T-levels, Institutes of Technology and the renewed 16-19 sector to succeed, we must “change fundamentally the relationship between schools, Further Education (FE) colleges and industry”.
“Teachers should spend time in the modern workplace to understand the value of technical skills. Schools must open their doors to their educational competitors in the FE sector,” Finegold added.