CHANCELLOR Philip Hammond confirmed in the final Autumn Statement on Wednesday that the government would spend an extra £2bn a year on research and development investment by 2020.
“We do not invest enough in research, development and innovation,” Hammond told MPs in what was the final Autumn Statement.
The chancellor said that as global competition picks up pace, Britain must build its “strengths in science and tech innovation to ensure the next generation of discoveries is made, developed and produced in Britain”.
The additional investment may be viewed as a concession to the science and technology industries, which are worried about the impact of the UK’s decision to quit the European Union. Both industry sectors rely heavily on freedom of movement of people and capital and investment from the EU.
Carolyn Fairbairn, CBI director-general, said the infrastructure investment move was “pragmatic”.
“The chancellor has prioritised a pragmatic down payment on future productivity growth. His emphasis on R&D, housing and local infrastructure will help businesses in all corners of the UK to invest with greater confidence for the long-term, during turbulent times. This will be warmly welcomed.”
The Institute of Directors, which represents directors and senior executives, tweeted: “This was sensible and sober #autumnstatement, but businesses would have liked to see more investment boosting measures.”
Step up R&D support for larger business
Angela Moore, research & development tax director, at PwC said that R&D reliefs for larger businesses could be around the corner.
The chancellor also announced he would ditch the Autumn Statement and that the Spring Budget would be the final one. From next year Hammond will have only one Budget and it will be in the autumn.