New Technologies

Oral Answers to Questions — Treasury – in the House of Commons on 5th March 2019.

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Photo of Trudy Harrison Trudy Harrison Conservative, Copeland

What fiscal steps he is taking to establish the UK as a world leader in new technologies.

Photo of Eddie Hughes Eddie Hughes Conservative, Walsall North

What fiscal steps he is taking to establish the UK as a world leader in new technologies.

Photo of Vicky Ford Vicky Ford Conservative, Chelmsford

What fiscal steps he is taking to establish the UK as a world leader in new technologies.

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

The Government are determined to ensure that the UK is at the forefront of the development of new technologies. Since 2016, I have committed £7 billion more—a 20% uplift —for research and development, thus demonstrating clear progress towards the Government’s ambition to raise investment in R&D to 2.4% of GDP by 2027. Among other things, those funds are supporting a £305 million national quantum technology programme and a £950 million artificial intelligence sector deal, and there is £250 million for connected and autonomous vehicles.

Photo of Trudy Harrison Trudy Harrison Conservative, Copeland

Small modular reactors could bring a wealth of economic, environmental and social benefits. Will the Chancellor confirm that he supports their merits, and that there will be financial and policy support to ensure that they succeed?

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

The Government do indeed recognise the potential for the UK to become a leader in the development of the next generation of nuclear technologies, provided that there is demonstrable value for money for consumers and taxpayers. To that end, my right hon. Friend the Secretary of State for Business, Energy and Industrial Strategy is considering an industrial strategy challenge fund proposal for small modular reactors, and whether it would provide value for money.

Photo of Eddie Hughes Eddie Hughes Conservative, Walsall North

I do not know whether you are aware, Mr Speaker, that up to 50 different metals may be used in a smartphone. What fiscal support could be given to the excellent work done by Birmingham University in addressing the rareness of those materials, as well as the recycling and reuse of batteries?

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

My hon. Friend is right. Rare earths and other critical elements are at the centre of the electronics industry which now defines our modern life. Some of the materials are very scarce, and recycling the large amounts that are already in use in batteries is crucial. In the 2017 spring Budget I announced the £246 million Faraday battery challenge, to be funded from the national productivity investment fund. Supported by the fund, the University of Birmingham, together with industry partners, is leading the way in developing new methods of recycling the lithium batteries which power so many of the objects that we use in our everyday lives.

Photo of Vicky Ford Vicky Ford Conservative, Chelmsford

Quantum technology is one of the most mission-critical technologies being developed today, and so far much of the work has been done at research level. How do the Government intend to help leading British companies such as Teledyne e2v in Chelmsford to commercialise this activity, to ensure that quantum technology remains based in the UK?

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

I knew Chelmsford was going to get in there somewhere.

The additional £7 billion I mentioned earlier is focused on applied research and industry innovation and the commercialisation of the UK’s world-leading science base. Quantum technologies have the potential to be transformative, and the UK is a global leader, so last autumn I committed £315 million for a second phase of the UK’s landmark national quantum technology programme. This investment includes a £70 million industrial strategy challenge fund, which will help leading UK firms such as Teledyne accelerate getting their products to the market.

Photo of Barry Sheerman Barry Sheerman Labour/Co-operative, Huddersfield

The Chancellor knows very well that Huddersfield in the Leeds city region is a hotspot for new technology and innovation and a tech centre, but many people in Huddersfield and Leeds are demoralised by the future and leaving the European Union. What can the Chancellor do to give them some hope that there is a future for their businesses and universities?

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

I am well aware that Huddersfield, like Chelmsford, is a leading centre of industry and technology development. Many of our towns and cities that have traditionally been centres of manufacturing are changing very fast in response to the changing nature of manufacturing industry. What I can say to the hon. Gentleman is that I will be making a spring statement to the House next week in the context of some very important decisions that the House will be making about our exit from the EU, and I will be setting out my vision for Britain’s future.

Photo of Melanie Onn Melanie Onn Shadow Minister (Housing, Communities and Local Government) (Housing)

Renewables is a key future technology sector. Can the Chancellor assure the House that the growth of the offshore sector will not be limited by Government airspace protection rules, or, if it will, will the Government look to invest instead in onshore wind?

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

I think the hon. Lady is talking about radar interference problems with wind turbines, something I remember from my Ministry of Defence days. The Treasury and the Department for Business, Energy and Industrial Strategy will always argue robustly for protecting the economic potential of these technologies, but of course we have to look at our national security interests as well and get the balance right.

Photo of Chris Leslie Chris Leslie Independent, Nottingham East

How on earth do people think that we are going to be improving the UK’s new technology position when we are on the brink in this House of committing to a disastrous Brexit that will undermine our research funding, stifle our skilled migration, hobble in some ways some of the developments in our pharmaceuticals and biotech sector, and wave goodbye to the European Medicines Agency? Isn’t the truth that actually our task is going to be to prevent a deterioration in our prospects as a country if we go down that route?

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

I understand the hon. Gentleman’s point and I know he speaks sincerely and from the heart on these matters, but my view is that we have a huge amount of pent-up investment that has not gone ahead over the last two and a half years because of uncertainty. Once we can provide clarity to British business about our future, which we do by supporting the deal that my right hon. Friend the Prime Minister will be bringing forward next week, we will unleash that investment, allowing Britain to achieve its rightful potential as one of the world’s leading technology powers.

Photo of Paul Scully Paul Scully Chair, International Development Sub-Committee on the Work of the Independent Commission for Aid Impact

New technologies enabling us to work from anywhere and at any time are bringing an end to the traditional, rapidly declining nine-to-five. In order to make the most of this we need to harness such advantages to work smarter rather than just harder. How is the Treasury investing in enabling people to become more productive and to work more flexibly?

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

I started work in 1977 and I am not sure I ever remember that traditional nine-to-five, but the Government are helping people to be more productive and work flexibly by committing over £1 billion of public money to next-generation digital infrastructure, including full fibre broadband and 5G. Obviously the primary investment will come from the private sector, but the public investment ensures that those parts of the country that would not otherwise be served because they are not commercial can share in this important technology. We are also supporting workplace productivity in other ways, including by investing £56 million to help small businesses to develop leadership and management skills in partnership with “be the business” programme.

Photo of Clive Lewis Clive Lewis Shadow Minister (Treasury)

I am sorry, but when it comes to funding the new technologies that really matter, this Government, and especially the Treasury, have been abysmal. The climate crisis is upon us now, but this Government’s reaction has been to axe carbon capture and storage funding; to cancel the Swansea lagoon, despite the fact that we were poised to be a world leader in tidal technology; and to slap innovative emerging storage technologies with business rates. At the same time, they are throwing billions into new tax breaks for oil and gas. Does the Chancellor agree that this Government are not facing the climate emergency but creating it?

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

No, we are committing additional funding to innovation and to research and development—the Faraday battery challenge is a good example—and lots of that money is going into the technologies that will underpin the decarbonisation of our economy. However, we have to get the balance right. Consumers of energy in this country do not want to see their bills rising because we have made imprudent decisions. We have to do this in a way that takes public opinion with us as we decarbonise our energy sector, our homes and our industry in a sustainable way.

Photo of Chris Green Chris Green Conservative, Bolton West

What is my right hon. Friend doing to ensure that small and medium-sized businesses in the north-west of England are at the forefront of our ongoing technological revolution?

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

I recently visited the north-west of England and saw at first hand the enterprising and enthusiastic spirit of SMEs in the region. I am happy to confirm that, in the 2018 Budget, I backed locally led innovation by doubling the strength in places fund to £235 million. I also committed an additional £5 million to encourage proposals for new university enterprise zones, following a successful pilot scheme that invested £15 million in Liverpool. The made smarter pilot in the north-west is helping manufacturers to adopt digital technologies, and together these measures will ensure that businesses in the north-west can take the lead in the fourth industrial revolution.