UK start-ups are “losing faith” in the government as a technology champion after successive efforts to buy more from domestic businesses have had little effect, according to a new report from the Startup Coalition, which says Andy Burnham’s “Buy British” push must address fundamental problems in the procurement process.
The lobby group, which represents technology start-ups and scale-ups, said: “For British start-ups and scale-ups, this really is the last-chance saloon after successive administrations have delivered warm words but little real action. The result is an ecosystem increasingly losing faith in the UK government as a buyer and champion.”
Successive governments over the past decade have struggled to increase the share of government spending that goes to small businesses. In 2015 David Cameron set a target for one third of central government procurement to go to small and medium-sized enterprises by 2020. The latest estimates from Tussell and the British Chambers of Commerce suggest that 21 per cent went to SMEs last year, a six-year high.
In the technology sector the picture is more concentrated. Tussell found that 84 per cent of UK government tech spending last year went to only 150 businesses, of which the majority were foreign.
Concern about the UK’s reliance on foreign technology, set against an increasingly fractious geopolitical environment, has added urgency to efforts to support domestic alternatives.
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