Labour vows to boost UK tech sector by easing planning and procurement processes

A Labour government would make it easier for Big Tech groups to build critical infrastructure such as data centres in Britain as part of a push to boost economic growth, the party’s shadow science secretary will say on Wednesday.

Peter Kyle will say that the main opposition party, if it wins the general election, will push through new policies to “supercharge” the UK tech sector and compete better with international rivals such as Silicon Valley.

Changes would include removing “barriers” in the planning system to make it easier for companies to build data centres, which store and process large amounts of information, and reforming the procurement process to make it easier for UK start-ups to bid for state contracts. 

“Britain is uniquely positioned to benefit from new technologies like AI,” Kyle is expected to say in a speech at London Tech Week. A Labour government would “place technology at the heart of our missions and unblock tech barriers to restart the engine of our economy”, he will say.

Although Conservative Prime Minister Rishi Sunak has taken an interest in the UK’s tech sector and profile, hosting the first global summit on the safety of artificial intelligence last year, it is overshadowed by that of Silicon Valley.

The area of northern California has long been home to companies such as Meta and Apple. More recently it has become a hub for start-ups developing generative AI systems, including ChatGPT-maker OpenAI. 

Under the plans announced on Wednesday, Labour would update national planning rules to make building key computing infrastructure easier.

Big Tech groups including Amazon and Microsoft have outlined plans to spend billions of dollars over the coming years on building infrastructure including data centres around the world, as they seek to become leaders in the field of generative AI.

Environmentalists have raised concerns about the impact of those ambitions, noting how the facilities are water- and energy-intensive.

The Netherlands has sought to limit new data centre developments in response to concerns including the huge amounts of power that a major buildout of the facilities would require.

Kyle is expected to say that Labour, which is about 20 percentage points ahead of the Tories in opinion polls, would also reform the procurement system to make it easier for small and medium-sized businesses to bid for government contracts.

The changes would include “rationalising” a system that involves multiple complex bidding frameworks at present, according to the plans. 

In addition, Labour would create a “national data library” to centralise existing government research programmes to facilitate scientists’ and academics’ access to public sector data.

“Under the Conservatives the planning system has become a handbrake on businesses,” Kyle is expected to say.

Small businesses, meanwhile, have been “locked out of the procurement system. They must contend with ever-increasing requirements, micromanagement and red tape”, he is expected to add. 

The policy announcement comes as 50 UK tech groups and people in the sector, including the accelerator Founders Factory, endorsed Labour in an open letter that highlighted rising competition in the sector.

“We need a government that will empower us to rise to these new challenges,” wrote the companies. “A lack of political stability and sustained, consistent strategy has held the tech sector back.”