Skip to main content

Local authorities and elected mayors must play a bigger role in digital development if the UK is going to level up regional tech hubs, a tech trade association has recommended.

A report published by techUK said that devolved governments and mayors should “publish and regularly update their digital strategies” and be given more “accountability” by central government.

The recommendation suggested that while local authorities are writing digital strategies, it is often not clear what actions need to be taken by members of the local tech industry, who require deeper and clearer collaboration with local governments.

Levelling up was a key policy introduced by former Prime Minister Boris Johnson. While regional tech hubs have enjoyed strong growth over the last two years, London and the South East still dominate in many metrics, such as attracting 81% of all UK venture capital investments.

“Finance and investment regionally lags behind London,” noted techUK’s 2022 Local Digital Capital Index report. “There must be improved access to VC and angel investment, better signposting to support and test new proposals such as creating new ringfenced regional funding in partnership with elected Mayors focused on outcomes and supporting vital national infrastructure.”

The report suggested that devolution deals could give regional governments and mayors more trade and investment powers to “help attract investment”.

The report goes on to say that relying solely on the central government is inefficient and doesn’t play to the strengths of local authorities which “know their area best” and know “where potential development will be coming, how this links with the wider plan and who’ll benefit”.

Investment zones must be ‘tech zones’

Another techUK recommendation is the endorsement of investment zones, a policy put forward by former Prime Minister Liz Truss in her ill-fated mini-budget. It would see certain areas receive incentives such as lower taxes to encourage greater investment into local industries.

The trade association said that tech should be put at the heart of these investmemt zones, such as building them with the infrastructure for testing emerging technologies like autonomous vehicles.

“Investment zones must also be ‘tech zones’ to attract people to work in them, base their business in them and secure new future investment,” the report noted.

The investment zone plan received mixed reactions from those in tech following its announcement.

The West Midlands – governed by the West Midlands Combined Authority (WMCA) and its mayor, Andy Street – recently announced it will appoint a tech commissioner. The role was created to champion the region’s tech sector and encourage greater investments.

The WMCA has submitted a bid for investment zones in the region and says it has the potential to boost the regional economy by more than £4.7bn a year and create 65,128 new jobs.