UK's 'buy British' tech push falls short
Less than £1 in every £6 spent on technology goes to British firms, with the US being the biggest beneficiary, accounting for £9.2 billion of the £19.2 billion spent with the largest suppliers
The UK government's 'buy British' tech ambitions are not being met, with less than £1 in every £6 spent on technology going to British firms. A report by the Institute for Public Policy Research (IPPR) found that while 42.5% of spending with the public sector's 150 largest technology suppliers appears to go to UK companies, this figure drops to 15.4% when considering the actual origin of the products and services.
The report highlights that a UK headquarters does not necessarily make a company British, as some are owned from overseas, others have most of their staff abroad, and many simply resell technology from US giants such as Microsoft. In fact, 43% of the spending attributed to UK-headquartered suppliers goes to resellers, with Bytes and Softcat alone accounting for around £2 billion of public sector technology spending.
The US is the biggest beneficiary of public sector technology spending, accounting for £9.2 billion of the £19.2 billion spent with the largest suppliers. This is a significant proportion of the total spending, and it raises questions about the effectiveness of the UK's 'buy British' policy.
The distribution of public sector technology spending is also a concern, with just 150 companies receiving 83% of the spending, and the largest 15 suppliers accounting for almost half. Smaller suppliers receive just 12% of government technology spending, compared to 27% of spending across government as a whole.
## Why it matters The UK government's 'buy British' tech ambitions are not just about supporting domestic businesses, but also about promoting competition and innovation in the tech sector. The fact that less than £1 in every £6 spent on technology goes to British firms suggests that the policy is not having the desired effect. Furthermore, the lack of transparency in government IT contracts, with 89.9% having no published record of how many suppliers bid for the work, raises concerns about the fairness and competitiveness of the procurement process.
## What happens next The IPPR report highlights the need for the UK government to reassess its 'buy British' tech policy and to take steps to promote greater competition and transparency in the tech sector. This could include measures to support smaller suppliers and to encourage more UK-based innovation and production. The government must also address the issue of resellers and ensure that public sector technology spending is benefiting British businesses, rather than just flowing to overseas companies.
