Was the budget good for IT?

Kate Craig-Wood is founder and CEO of hosting company Memset. She said, “There are three things in 2010’s budget which I’m really pleased to see as a high-tech entrepreneur:

1) Pushing RBS and Lloyds to lend to small businesses. Despite a healthy, profitable and growing business, we have not been able to get borrowing from any banks under the EFG without providing director’s guarantees. We need banks to be willing to share at least a tiny portion of the risk, otherwise we may as well just extend our mortgages even more. As a cloud computing provider, we are very capital intensive – our growth rate is limited by cash availability more than anything else. Without borrowing our growth rate is capped at what we, the directors, can afford to leave in the business.

2) I’m really relieved to see the increase in investment allowance, doubling capital gains tax relief for entrepreneurs and the freeze on capital gains (we feared it would return to 40%). With these changes I am now more inclined to keep investing the majority of my personal wealth back into my business to help it grow as fast as possible.

3) I’m pleased to see that they are hearing our (high-tech sector’s) desperate need for science & maths graduates, but that must not come at the expense of university-based “blue sky” research!

Barry Murphy, UK technology leader at Price WaterHouse Coopers, said measures to support the computer games industry sound positive but need more clarity around them. 

“The Games industry has long argued for support to stem the drift of talent and jobs from the UK. Just how much support is in the rules we still need to see, but if modelled on the film tax relief rules there is at least a well understood base to work from.

“The bigger picture here is how games are becoming part of the user media experience and are no longer confined to teenagers in darkened bedrooms. Online games have transformed into a social medium. As an example 8.5% of BBC iplayer viewing in September was via the PS3 games console.

“Additionally embedded advertising in games is set to be a large growth market therefore incentivising activity that allows the UK to participate in this economic success is welcome.”


Matthew Poyiadgi, European vice president at CompTIA, the global IT industry association, said the speech held a couple of points which could spell good news for the IT industry:
“The 15% increase in government contracts to SMEs will have advantages on both sides. For IT SMEs this will obviously mean more opportunities to win contracts from government. But they need to be smart. They will be up against large companies who have been doing this for years, so will need to really understand what the department is looking for, identify how they can deliver it better than anyone else, and communicate that smaller organisations can do the job just as well as larger ones.
“The Chancellor also announced a green investment bank with £2bn of equity to fund low-carbon transport and energy schemes. He also emphasised his commitment to Digital Britain and rolling out broadband across the UK. Such high-tech initiatives require technology development, implementation and ongoing management, so this is great news for the IT industry which will play an essential part in supporting such projects. 
“This is a welcome move from an environmental perspective, but we shouldn’t let the excitement of shiny new technology distract us from other important environmental challenges. There is a lot that can be done through better IT practices which will have a huge effect on emissions and help organisations meet targets and save money. 
“Perhaps a more important measure from the industry’s perspective is the Carbon Reduction Commitment Energy Efficiency Scheme which comes into force on 1 April, placing responsibility on organisations to cut emissions across the board. IT has an important role to play here and that is why CompTIA has today launched a new certificate in Green IT, which will help organisations cut their carbon emissions and save money through sustainable IT practices.”