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techUK President Encourages Tech to Act Now to Shape Future of the UK

Speaking at the techUK Annual Dinner, our president Jacqueline de Rojas told guests tech is the beating heart of the UK economy and will drive economic renewal through a modern industrial strategy: 

JdR 23

The well-known American computer scientist, Alan Kay, once said, “the future cannot be predicted, but futures can be invented."

Let us be clear, the EU referendum is a watershed in British history. The UK is committed to forging a new future outside the European Union. 

But while Brexit is a huge challenge we must think beyond it and decide what sort of economy we want for the 2020s and beyond.

There are complex challenges ahead but there are also opportunities. I believe that those  who invent the future, shape the future.

So tonight, I've got three things on my mind: 

Yes Brexit, of course, Brexit but in parallel how we can re-shape our economy for the digital age; And why so much change, means that we must work harder, to win hearts and minds. 

The UK already boasts a digital economy that is the envy of many countries around the world. Our most digitally intensive businesses account for 16% of UK output, 24% of exports and over 3 million jobs. 

The recent MasterCard Digital Evolution Index identifies the UK as a ‘stand out nation’ and I quote “powering ahead of rivals with a complex formula of infrastructure, incubating start-ups, a cultural commitment to innovation, and government support.” 

Digital is creating jobs three times as fast as the rest of the economy. They pay 44% more than the national average and are more than twice as productive as non-digital jobs. And it is not just the high skilled that benefit. Every time we create ten advanced economy jobs we spawn six so-called ‘non-tradable’ jobs, such as roles in hotels, restaurants and hair salons.

We are Europe’s undisputed tech hub, enjoying twice as much investment in tech than any other European country and we are home to the very best stable of tech unicorns. 

This is a remarkably positive picture. But one that we cannot take for granted as we prepare to leave the European Union. 

Brexit demands that we invent a new future for this country.

However, the clock is ticking. We are just months away from separation, yet we still know remarkably little about our destination. There is growing evidence of the serious implications of leaving without a deal and a real worry that the UK’s reputation as a world leading open economy is under threat.

techUK works hard to highlight the implications for skills and talent; access to investment and research funding; international data flows; and the practical challenges of leaving the single market and the customs union. Given time and detailed work many of these issues could be mitigated. And new opportunities for global trade could be secured.

But these issues cannot be properly resolved within the timescales of the Article 50 process. A safe landing for Brexit needs a long runway. 

The UK economy must have a transition period that allows sufficient time to organise and negotiate the myriad of new immigration, customs, regulatory and investment arrangements. We believe that maintaining membership of the single market and the customs union for a limited period is the smarter route to success. And allows time for a new comprehensive trade deal to be put in place. 

This is not a strategy for rolling back on the outcome of the EU Referendum. On the contrary, this is the best approach for securing business confidence and will lead to a safe Brexit in the long-term. Alternative strategies represent unnecessary risk. We do not believe that UK consumers are securely braced for the impact of a Brexit crash landing nor will they thank anyone for delivering it. 

So the clock is ticking. Business Leaders need confidence that the plane can be landed safely. 

But we must also pay attention to our brand - what do we want the UK to be known for? The Global Digital Index report that I referred to earlier describes ‘openness to global trade’ as the most important differentiator for the elite of digital nations and described the UK as being the example par excellence of an economy attracting the world’s best digital talent into a melting pot of innovation.

But we have to recognise that Brexit has impacted our global reputation for openness. We need to respond to this and get on the front foot to protect our brand as an open, collaborative and dynamic economy that is looking outwards and not inwards. 

But Brexit isn’t the only driver of change. The global digital revolution demands that we reshape our economy. Why? Because then we can boost our productivity, build a smarter state, create the jobs and skills of the future and empower people for the digital age. 

But how do we achieve this?

We need to start by driving economic renewal through a modern industrial strategy. 

Paul Krugman famously said, “Productivity isn’t everything, but in the long run it is almost everything”. Boosting productivity is the single most important factor in increasing living standards. It is often said that the Germans could take Fridays off and still produce more than we do in a week. 

If we are going to be as competitive as our near neighbours, we must strengthen our capacity for innovation. We can do this through a bit of our own “vorsprung durch technik” - boosting investment in the UK’s R&D; accelerate the process of digitisation and create the best conditions for investment in world class infrastructure. 

Industrial revolutions are as much about adoption as innovation. We need greater incentives for UK businesses, particularly SMEs, to invest in productivity enhancing tech. Digital adoption must be at the heart of the industrial strategy. 

The next thing we must to is commit to building a Smarter State 

Let’s be frank here –the current cost of our public services is simply unsustainable. The Office of Budget Responsibility (OBR) suggests that public sector net debt will rise to 234% of GDP in 50 years. The inconvenient truth is that either the state gets smarter or our public services will get smaller.

The smarter state means placing tech at the heart of government, driving down the cost of administration, improving delivery and strengthening participation.

Since the creation of the Government Digital Service, we have seen significant progress. Government has worked hard to create a digital-by-default culture and increase engagement with a wide range of new and established tech companies. 

Tech savviness across government is improving. I know techUK members see real promise in initiatives like the Department for Work and Pension’s SPRINT programme.

I am also delighted that techUK is now an official NHS Digital strategic partner, bringing the sector’s expertise right to the heart of NHS strategy. It is plain for all see that the health and social care system is struggling to deliver. We know how urgently it needs a digital transplant. 

These are all welcome steps, but in reality we have to pick up the pace. Put simply, a smarter state is the only state that we can afford. And the only way we can meet the needs of the people.

But we also need to create the Skills and Jobs of the Future

The dynamism of the sector means tech creates new jobs at nearly three times the rate of the rest of the economy. We are not yet close to having the domestic skills pipeline that we need. We are creating more jobs than we can fill. And yet we are turning off the tap to international talent.

This is a serious concern to the sector – 45% of net employment growth in the digital sectors from 2009-2015 was accounted for by foreign-born workers. We all know that the UK’s digital sector would not be in the strong position it is today without the vital contribution of these skilled and talented people.

We welcome the Government’s manifesto pledge to “ensure digital businesses have access to the best talent from overseas” and hope to see this shortly set out in policy.

Meanwhile we all need to work harder to nurture our domestic talent. We need a clear and ambitious policy for lifelong learning that includes strong incentives for companies to retrain people on the job.

Digital skills will be the foundation for anyone to succeed in the new economy.

But we must also create a Safe and Secure Digital World 

Everyone in this room supports the Government’s ambition in the Digital Charter to make the UK the world’s safest digital economy.

The ransomware attack in May this year highlighted the vulnerability of businesses and public services to global cyber threats. Led by the new National Centre for Cyber Security, the UK must build on its strong cyber security credentials to become a global centre of cyber expertise.

But we also need to recognise the importance of tools such as end-to-end encryption in keeping people safe. As Robert Hannigan the former head of GCHQ said recently, end-to-end encryption “cannot be un-invented and those of us focused on cyber security would not want encryption weakened even if it were possible”. 

Let’s not mischaracterise the argument – companies care just as much about safety as government’s do. We will continue to work responsibly with the security services, within a robust legal framework, to tackle the threats both online and offline, and, continue to develop new technologies to help tackle the problem of extremist content online.

This brings me to my third and final point of my speech tonight. If we are going to invent this future, we will need to bring people with us.

There is no word the tech sector loves more than disruption. For us it is the key to opportunity. Unlocking new ways of doing things. Driving efficiency. Reducing friction.

Our members are using data analytics to aid the early diagnosis of pancreatic cancer; deep learning to improve the efficiency of the energy grid; contactless payment technology to improve passenger flows through tube stations. These are all things that directly improve people’s lives. Sometimes imperceptibly – a less stressful tube journey. Sometimes profoundly – a life-saving cancer intervention.

But not everyone is so excited about disruption. For some it implies a world of winners and losers – the disruptor and the disrupted. Change for change’s sake. A world where the winner takes all.

The public has not given up on the benefits of innovation but they have plenty of questions about how technology is shaping their lives. They want to know that businesses are on their side, putting people first. Particularly as we enter a world of intelligent machines.

So how we as businesses and individuals respond to the big questions really matters. Unless there is confidence that we can solve the biggest social, legal, ethical and economic questions we risk seeing our licence to innovate restricted by a desire to control and slow the pace of change.

• Have we understood the implications of the next wave of automation?

• Do we understand the impact of screen time on mental and physical wellbeing?

• How do we ensure that decision-making algorithms are transparent and don’t embed discrimination?

• How do are we going to ensure the ethical use of artificial intelligence?

These are all legitimate and important questions that demand answers. There is no monopoly of wisdom. As the pace of digital change accelerates collaboration is at a premium.  We need politicians, policy makers, charities, and businesses to work together to navigate these complex questions that require nuanced policy responses. We will fail to resolve any of these issues if we simply debate by megaphone. 

Inventing the future isn’t just the job of the technologists. We all have a role to play. We, the people in this room have more potential than most to shape the world that we and our children will live in. We all have a responsibility to play our part. If we don’t set out a positive vision for the future then no one else will.

Let me be clear. The cavalry isn’t coming on this one.

So my ask of you is this. What are you doing to be an ambassador for the future?

How are you inspiring the next generation? How are you investing to build our future skills base? How are you ensuring a culture of data ethics in your work? What are you doing to encourage collaboration and openness?

This isn’t about strategy or policy. It is about tone, culture, narrative and personal action. It is about the role that we can all play in inventing the future.

They say the flutter of a butterfly’s wings can cause a tornado on the other side of the world.

Whatever the causes - and I suppose there are many - it is clear that we stand at a remarkable moment in history. 

From Brexit to the challenge of re-shaping our economy for the 21stCentury the decisions and actions taken in the months ahead will have profound consequences. We have a choice to be passive bystanders or active participants. We can be swept along by history or we can act with purpose to shape it. 

So lets remember the words of Alan Kay:

Lets be the country that invents the future.

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