Intellect: Govt needs to do more for ICT firms

The Coalition Government is not doing enough to encourage take up of start-up and SME ICT firms to drive economic recovery for the UK.

That was the warning issued by Intellect, the trade association for the UK technology sector at its Regent Conference in London this week. "We are doubtful that the government's growth review will deliver a coherent picture of technology inclusion that will encourage the development of a broad based technology sector in the UK," said John Higgins, Intellect Director general.

"We believe ICT is a productivity power tool, which, if used well, will deliver a significant boost to growth," he added. "We are doubtful that the government's growth review will deliver a coherent picture of [technology inclusion] that will encourage the development of a broad-based technology sector in the UK."

Higgins also took a swipe at the government's plans to recreate Silicon Valley equivalent in East London, arguing that having start-up companies there was not going to be enough. "Start-up companies with UK-based technology are important but are not enough; we need to ensure that technology companies, large and small, UK and foreign owned are involved across the whole economy," he said.

This theme was picked up later by Mike Lynch, CEO of UK software giant Autonomy, who argued that encouraging highly skilled foreign workers to come to the UK will help create new IT jobs and new firms. He predicted that for every ultra-skilled worker that moves to the UK, there would need to be 15 entry level programmers employed to support them.

"The first thing you ought to do to generate more entry-level jobs in the UK is to put out a sign saying, 'If you are skilled in IT we will welcome you here'. We should have the idea of the ultra-skilled worker," he said.

He also suggested that the UK government should start to favour its own firms more overtly. "The US government favours US firms and smaller firms. If the US government gives business to big companies it also has to give some to smaller firms as well. Why shouldn't we do what the US does?" he asked.

That seems unlikely any time soon if the words of Ian Watmore, the COO of the government's Efficiency and Reform Group (ERG) are to go by when he rejected the idea that the UK government should favour UK firms when purchasing IT services and equipment.

"The 'Buying British' thing is one of those classically difficult areas when we have international competition policy that says you cannot do that," he said. "It is not in our interest to go in for insular buying because the British economy is mostly export-driven."

But Watmore insisted that the Coalition remains committed to opening up more government business to SMEs, but conceded that the current tendering and contractual requirements often shut such firms out. "We want to see Britain's economy grow on the back of a digital revolution and we find we are more likely to attract indigenous British companies if we make procurement simpler," he admitted.