Contrasting Industrial Strategies for Technology in the UK: Labour vs. Conservative Perspectives

The future of technology in the United Kingdom has become a cornerstone issue in recent political discourse.  Ahead of the upcoming general election later this year, the Conservative and Labour parties are each in the process of setting out their stalls and heralding their visions for the nation's future, technological landscape.

The Labour Vision

In September 2023, the Labour party published “Prosperity through Partnership: Labour’s Industrial Strategy” which portrays a more interventionist approach to its industrial strategy, emphasising public ownership and investment in technology, centred around inclusivity, democratic control and leveraging innovation for the collective good. 

Labour’s industrial strategy advocates the creation of a National Investment Bank alongside a network of regional development banks to fund technological innovation, alongside other investments.  These banks would focus on projects that have a societal benefit, aligning with Labour's emphasis on inclusivity.  Labour suggests that it will mobilise public resources to support startups, foster innovation and create a level playing field for businesses.

It also plans to establish a new public agency, 'Innovate UK Plus', to work in collaboration with industry and academia to identify and support technologies that address pressing societal challenges, such as climate change, healthcare and education.

Labour's strategy places a particular focus on greentech and sustainable technologies.  Their vision aims to position the UK as a global leader in renewable energy, sustainable transportation, and environmental technologies (such as the use of hydrogen and electric arc furnaces in the production of green steel).  By prioritising green initiatives, Labour seeks to address the urgent need for climate action, whilst stimulating economic growth.

The Conservative Vision

The Government currently appears to have a more fluid industrial strategy.  In its March 2023 policy paper setting out the UK’s International Technology Strategy, the stated ambition is for the UK to become a science and tech superpower by 2030.  The finer detail around how this is to be achieved should emerge into the light in the coming months - surely one might expect it to have a strong emphasis on innovation, entrepreneurship, and international partnerships but, currently, there has been little evidence of this holistic approach to driving UK growth in the sector.

A commitment to fostering a competitive business environment for new technologies and supporting startups might be expected as core tenets of Conservative party strategy.  Will this alone be enough to create the necessary energised boost, at a scale needed by the UK economy if it is to rise to meet these lofty ambitions after what was a rather sluggish in 2023 (with many predicting more of the same for this year)?   Whilst words have been spoken of a number of tried and tested initiatives such as increased investment in R&D, tax incentives for tech businesses and the promotion of digital skills training, these actions appear relatively weak and limited in scale in the context of the sizable ambition.  When coupled with the mixed messaging from other Government policy announcements such as the recently proposed, minimum salary requirement for skilled worker visas, there appears a lack of unanimity and committed drive towards this vision of nirvana. 

There have been a number of Government announcements prioritising support for various tech sub-sectors - e.g. semiconductors, quantum tech, telecoms and most recently, at the Conservative party’s conference in the autumn, AI safety and resilience dominated discussions, whilst digital exclusion and the Online Safety Bill were also on the agenda.  

This was followed towards the end of last year by the UK hosting the first, global AI Safety Summit - the Government hoping that it will place the UK firmly on the global stage as a world leader in the space.  It even went so far as to suggest that, as a regular summit, it might become something of a “COP” for the technology sector. 

As ever more details of the Government’s technology strategy start to emerge, it is evident that a strong emphasis will be placed on biotech, aiming to leverage the UK's world-class (if economically-floundering) healthcare system and technological expertise to drive innovation in healthcare solutions.  This focus should not only address pressing societal needs but also position the UK as a global leader in the field. 

Jeremy Hunt's visit to Silicon Valley last autumn was a further strategic move by the Government to establish and build relationships with global tech giants.  Discussions with key industry leaders focussed on opportunities for collaboration in areas such as AI, healthcare technology and clean energy – all being fields into which Hunt aims to attract foreign direct investment, foster collaboration and promote the UK as an attractive destination.  Subsequently, several major tech companies expressed interest in expanding their operations in the UK, citing the country's strong talent pool and supportive regulatory environment as decisive factors.  We wait with bated breath to see whether equal levels of optimism and enthusiasm in the future of the UK’s tech economy can be cultivated within the globally fluid startups and scaleups, or whether alternative, emerging jurisdictions which apply a leapfrog development strategy might appear more attractive.

Which way is best for UK plc?

Determining the likelihood of success for either party's industrial strategy (once each is fully formulated) will require careful consideration of the political, economic and societal landscape in which it will play out.  The Conservatives’ likely approach, with its emphasis on a business-friendly environment and international collaboration, aligns with prevailing global trends in the development of technology.  By leveraging existing strengths and new strategic partnerships, their strategy could offer a pragmatic approach but will it simply be “business as usual” when they might be even more ambitious?

Labour's approach is undoubtedly ambitious - its pursuit of public investment and ownership may garner significant support but it may also face challenges in implementation.  The success of its tech strategy relies heavily on effective government intervention, which historically has been a subject of much contention but, if successful, will address the environmental and societal concerns that currently form key agenda items in global politics. The Labour camp’s most recent messaging that it should be considered the party for business suggests that it might assume a lighter interventionalist touch, whilst borrowing some of the Conservative’s recent rhetoric.

Ultimately, the success of these strategies will hinge on effective execution, adaptability to evolving global trends and their need to be insulated from other competing policies and narratives, both internationally and domestic.  As the technology landscape continues to evolve, it is imperative that the chosen strategy provides a long-term platform of strength and yet is sufficiently flexible to accommodate unforeseen challenges.  The true test of success will lie in the ability to transform vision into tangible progress on the world stage, attracting talent and investment, for the benefit of both the technological ecosystem and broader society.