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Small UK high-tech firms need government support, says Nesta

The economic downturn is threatening many of the UK's small high-tech companies, warns a business investment group.

The National Endowment for Science, Technology and the Arts (Nesta) has called on the government to provide emergency funding, according to the BBC.

The report said the UK could lose its leading international position in green technology, digital media and health care if the government does not intervene.

Nesta's warning came as the government announced plans for targeted ways of helping the high-tech industry, including funding for academic research.

There are no indications, however, that the government intends going as far as providing the kind of emergency funding Nesta has called for.

The group said in a report that there was a 70% fall in new venture capital funding last year and the government should join the private sector in providing £1bn for high-tech investment.

Nesta has also called on chancellor Alistair Darling to use the government's multi-billion fiscal stimulus package to support lending to companies working on new technologies.

Failure to rise to the digital challenges to capture a share of the global market for clean technologies and renewable energy will cost the UK billions of pounds in lost revenue, the Nesta report said.

In February, Nesta called for the government to deliver super-fast broadband access across the whole of the UK in the next five years and provide free basic broadband to the poor.

The convergence of infrastructure, networks, telecommunications and content will be critical in driving forward the UK economy, said Nesta.


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