Steve Hare, the CEO of tech giant Sage, has repeated his call for the government to grasp the UK’s opportunity to be an advanced digital economy and address flatlining productivity.
Speaking to mark the launch of Sage’s Blueprint for Digital-led Growth today, Hare said: “SMBs are ready to embrace the power of technology to grow their businesses. We welcome plans for the Global Summit on AI and encourage government to set out an ambitious and joined up approach to digitalise the economy so all UK businesses can benefit from technology.
“As the UK government strives to be a tech superpower, meet net zero targets, and enable home-grown businesses to compete internationally, it is essential SMBs are supported on this journey. Our Blueprint offers an achievable plan to help deliver this.”
Hare had previously written in his blog of the dangers of falling behind European competitors if the government failed to commit to the sector. Sage’s new Blueprint document follows that up with policy proposals that will prevent the UK falling behind other hi-tech nations and trigger much needed investment in innovation and automation.
This follows the closure of the failed Help to Grow: Digital scheme and the third delay to the next phase of the Making Tax Digital programme, which has been deferred to 2027 at the earliest.
The Blueprint sets out how government can address this to ensure small and mid-sized businesses are able to benefit from technology, such as AI, to increase growth and productivity, unlock innovation and take action against climate change.
Despite resilience and optimism, rising overheads, and inflationary pressures, coupled with low cash balances, mean UK SMBs are not in a strong position to invest, holding back productivity.
92 per cent say technology is vital to their survival, yet they plan to increase technology investment by only 13 per cent, below the European average of 18 per cent. The Blueprint sets out ways to put SMBs in a stronger position to address these challenges.
With a potential £232bn in annual gross value added (GVA) waiting to be added to the economy through further digitalisation, Sage’s Blueprint highlights the need to underpin tech investment, with a time-limited Small Business ‘Digital Growth Fund.’ This would offer tax reliefs on investment in productivity software to help SMBs overcome financial barriers to digitalisation and stimulate the investment needed for the UK to remain competitive.
It highlights the fact that, as part of its 2022-23 Budget, Australia introduced the Small Business Technology Investment Boost, aimed at increasing productivity and digital uptake of SMBs. Sage is calling on the UK Government to introduce a similar scheme to scale digital adoption needed to strengthen the economy.
Darren Jones MP, Labour chair of the business and trade committee said: “As technology continues to evolve rapidly, Sage’s Blueprint for Digital-led Growth reminds us of the need to empower SMBs to adopt digital tools.
“With signs of business investment beginning to slow down, the government must act to incentivise the adoption of productivity-enhancing technology, ensuring that the UK remains competitive and accelerates economic growth.”
