Will cuts harm the electronics industry's future?
1 min read
While financial experts continue to pore over the finer details of last week's emergency budget, there appear to be some business friendly items.
Trade association Intellect says plus points include capital allowances, R&D tax credits and the 10% capital gains tax rate for entrepreneurs.
But an ominous cloud lies on the horizon – departmental spending is to be cut by 25% across the board. For a high spending department such as Business, Innovation and Skills (BIS), this will be challenging. BIS has already had £836million taken from its budget, which runs at about £17billion a year, according to the Budget documents.
Where might £5bn – BIS' spending may be cut by more than the 25% average – be saved? Staff costs are an obvious starting point, but programmes are more likely targets.
Will these be cut across the board by the notional 25% or will some be more vulnerable than others? Would operations such as the Technology Strategy Board, with its Knowledge Transfer Networks, and UK Trade and Investment be seen as surplus to requirements? Where does the Engineering and Physical Sciences Research Council (EPSRC) – wholly funded by BIS – stand?
As far as electronics is concerned, BIS has responded well over the last couple of years to approaches by the Electronics Leadership Council and others. For the moment, it is aligned more closely with industry's needs.
Arguably, just at the time when its support is needed more than ever – a global economy coming out of recession and looking for new technologies – BIS may have the rug pulled from beneath its feet.
