competitive industry landscapes. If trade
deals put UK companies at a disadvantage on
the world stage, the need to be creative and
forward-thinking increases tremendously.
John Lowndes, Director at MPA Group
International collaboration
While international funding for UK research
has fallen in recent years,from £5.6 billion in
2014 to £5 billion in 2017, it still comprises
14% of all investment in innovation. But it’s
not just the financial connection to Europe
that UK companies will have to cope without
after Brexit, but the level of continental
collaboration currently in operation at
universities and research centres across the
country.
UK industry and innovation is revered across
the globe, with our institutions producing
world-leading work in every sector. Such
breakthroughs are only possible by bringing
together the best people from across both
Europe and further afield. In fact, in the
decade prior to the 2016 referendum, 50%
of all UK research publicationsinvolved a co-
author from overseas.
Moving forward, Brexit may make it more
difficult for businesses to recruit staff from
overseas and make cross-country projects
rather impractical, if not impossible. There is
talk of plans to only allow immigrants who
earn over £30,000 to stay in the country
and this could make it difficult for bodies to
continue hiring skilled international research
assistants and graduates as salaries for these
jobs are generally below the threshold.
Britain’s booming tech industry has given the
country potential to dominate and grow in IT
and many other sectors.
Mark Sewell, CIO of Microsoft recruitment
partner Curo Talent, explains that for the
many industries developing IT infrastructure,
such as in financial services, there is concern
that there may not be enough IT talent
available to match increased demand.
The average age of the IT workforce is
increasing, and Britain’s education system
is not producing an adequate number of
skilled workers to replace these employees
once they retire. This is exacerbated by Brexit
and its restriction on access to talented
EU-workers. To continue this development,
businesses need IT workers with the skills to
deploy the latest technology, unfortunately
this talent pool may become limited.
Such barriers may force businesses to seek
ventures elsewhere. Even British companies
might start to launch their innovative
operations overseas, targeting countries
which have both good R&D incentives and
simpler immigration policies, allowing multi-
national teams to work without obstacles.
Asian nations might be among those that
benefit, with China and South Korea as
potential suitors. In recent years, South Korea
has been one of the world’s biggest investors
in R&D and UK businesses could cash in on
the country’s commitment to progress.
Uncertain fortunes
As with most aspects of Brexit, no-one really
knows how the UK leaving the EU will impact
on homegrown innovation.
While some relevant policies will remain
unchanged, such as the general R&D claim
process, there are wider-reaching implications
which could affect British researchers.
The UK has an excellent reputation for
innovation and this could prove significant. If
our economy suffers as a result of Brexit, the
value of the pound against other currencies
will fall.
As such, global businesses may see British
companies as attractive investments, as their
quality services and projects will suddenly
be available for smaller sums. This could
potentially fill the void left by current EU
funding.
R&D tax credits and Patent Box relief will
play a crucial role in establishing the UK as a
creative force post-Brexit. Once EU funding
for projects is removed, the importance of
the domestic HMRC initiative will amplify
tremendously, potentially causing a rapid
increase in applications.
Continuing and improving the financial
incentives for businesses to spend time on
R&D will ensure that the country continues to
be at the forefront of innovation. MPA Group’s
guidance on the R&D Tax Credit Scheme and
Patent Box relief will help you see whether
your company qualifies for the initiative.
www.thempagroup.co.uk
Issue 41 PECM
13