The UK government has announced plans to unlock billions of pounds in funding for startups and attract top AI talent as part of its industrial strategy, a multi-year plan to bolster the country’s business landscape.
Unveiling the strategy on Monday, the UK government said it would invest in and support homegrown companies over the next 10 years. The announcement comes after prime minister Keir Starmer’s courting of tech leaders earlier this month, as he looks to boost the British economy amid economic stagnation.
The plan will see the British Business Bank (BBB) given an extra £6.6bn to invest in VC funds and startups by 2030, alongside the launch of a £54m talent scheme to lure AI workers from overseas.
There are also financial support packages for the UK’s quantum sector, increased R&D spending and regulatory changes for AI, autonomous vehicles and biotech.
“This Industrial Strategy marks a turning point for Britain’s economy and a clear break from the short-termism and sticking plasters of the past,” said Starmer in a statement.
“This is how we power Britain’s future — by backing the sectors where we lead, removing the barriers that hold us back, and setting out a clear path to build a stronger economy that works for working people.”
Funding boost
Of the new funds for the BBB, £4bn will be spent towards its growth capital strategy, and invested across across the eight sectors the government has defined as “growth-driving”: advanced manufacturing, clean energy industries, creative industries, defence, digital and technologies, financial services, life sciences and professional and business services.
The bank says that it expects the increased funding to bring in another £12bn in private capital. There will also be another £2.6bn committed to help drive growth at SMEs in British and Northern Irish startups based outside of London.
Much of the extra funds will be invested into VC funds, but the BBB tells Sifted it’s significantly scaling up the direct investment arm of its business and will begin allocating capital to startups from April 2026. It will lead rounds and invest up to £60m in UK companies.
Private debt funds and angel syndicates will also be allocated extra funds.
Attracting talent
The industrial strategy also included £54m for a talent scheme to attract world-class researchers.
“The Global Talent Taskforce will support researchers, entrepreneurs, investors, top tier managerial and engineering talent and high-calibre creatives to relocate and work closely with the UK’s international presence to network and build a pipeline of talent who want to come to Britain,” the UK said in a statement.
The funds will be allocated over the coming weeks via government body UK Research and Innovation to universities and other research organisations. It will have no impact on net migration to the country, the government said.
It comes weeks on from tech industry leaders telling Sifted that government plans to cut immigration would increase talent shortages in key sectors and force startups to relocate.
The industrial strategy will also see a £500m investment package for quantum computing and £2bn to reduce electricity costs for more than 7k businesses, as Starmer looks to address the fact that manufacturers in the UK currently have some of the highest electricity prices in the developed world.
The UK also announced it would boost spending on research and development across its eight key sectors by £22.6bn a year by 2029-30, and invest £2.5bn over five years to develop fusion technology.
Read the orginal article: https://sifted.eu/articles/uk-industrial-strategy/
