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CBI: Digital economy needs joined-up regulations and gigabit broadband

The coronavirus pandemic has shown the need for fast, reliable networking across the UK. The CBI is urging the government to do more

The CBI has called on the UK government to support dynamic startups and scaleups to develop a world-leading digital regulation strategy.

The business group has published a five-point plan in a new report, Building a world-class innovation and digital economy, which highlights the need for a comprehensive, joined-up digital regulation strategy that would provide companies with the long-term certainty needed to invest in the UK

The CBI acknowledged that the coronavirus pandemic has driven a colossal demand for technology, connectivity and innovation amongst businesses and consumers. However, in the report, it warned that there is skyrocketing pressure on digital connectivity networks to power new technologies, and a growing concern about the impact of future regulation on the UK’s digital dynamism.

“The crisis has shown how much can be achieved in a short period with a strong partnership between government and industry and clear goals. This spirit of collaboration must be capitalised on in the months ahead, to unleash the benefits of innovation and build back better,” the CBI stated in the report.

Specifically, it called on the government to match political pledges with accelerated action on digital infrastructure. This should include running a twelve-month policy drive to reduce the time and cost of gigabit broadband network roll-out.

The CBI predicted that nationwide gigabit-capable connectivity could allow 400,000 more people to work from home and give people greater flexibility in where they live. This means 270,000 more people could move to rural areas, reducing pressure on transport networks and urban housing.

For businesses, it said that 5G, or gigabit full-fibre or fixed wireless networking would drive the Covid-19 economic recovery, supporting innovation adoption and economic opportunity.

Networking the UK

The government has set out a 2025 vision for the rollout of gigabit connectivity in the UK. However, the CBI warned that there are a number of blockers to this policy, including access to properties, business rates, and ensuring regulatory reform incentivises investment.

It urged the government and Ofcom to address these to help businesses to invest more, upgrade networks more quickly, support the business case in potentially competitive areas like business parks and small market towns, and stimulate uptake. The CBI estimated that nationwide full fibre could boost productivity by £59bn and create 1.2 million extra jobs by 2025.

The report suggested that gigabit-capable networks could also help address wider societal issues such as cutting carbon emissions by reducing the need to commute, vital for a green economic recovery.

However, these benefits could be impacted unless the policy blockers are addressed concurrently. The CBI recommended that the government form a task force comprising business energy and industrial strategy (BEIS), digital, culture, media and sport (DCMS) and HM Treasury (HMT) departments, which should embark on coordinated demand stimulation, building on the shift to home working during the pandemic.

This task force should advise on a strategic and evidence based approach to stimulate business and consumer demand for gigabit capable broadband connections and 5G. The CBI recommended that the government prioritise the amalgamation of gigabit-capable connectivity adoption with wider work on business and public sector technology adoption, such as the BEIS Business Basics initiative, as well as lessons learned on technology adoption during the pandemic.

From a regulatory compliance perspective, the CBI urged the DCMS and HMT to develop a concise, cross-government strategy by mid-2021 to coordinate digital regulation, competition measures and review regulatory remits. It said that businesses are keen to provide insight to help the government map digital regulations, identify overlap and pinch points, and find opportunities to limit the regulatory burden on new challengers and scale-ups.

Read more about tech recovery

The CBI also recommended that the government use the National Data Strategy to articulate an ambitious and coordinated vision that stimulates innovation, delivers public value and upholds trust. It said that there is an opportunity to capitalise on lessons learned from data sharing during the pandemic to support companies’ own open data initiatives.

The report recognises the UK as a global leader in artificial intelligence. To sustain this leader position. The CBI said the UK needs to develop a regulatory and support ecosystem that promotes adoption, innovation and ethical development of the technology. “Government should continue to support the work of the Centre for Data Ethics and engage closely with industry and civil society in the development of a regulatory approach that promotes innovation and builds trust in the technology,” the CBI said.

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