UK’s long-delayed digital strategy looks to AI but is locked to Brexit

The UK government is due to publish its long awaited Digital Strategy later today, about a year later than originally slated. Existing delays having been compounded by the shock of Brexit.

Drafts of the strategy framework seen by TechCrunch suggest its scope and ambition vis-a-vis digital technologies has been pared back and repositioned vs earlier formulations of the plan, dating from December 2015 and June 2016, as the government recalibrated to factor in last summer’s referendum vote for the UK to leave the European Union.

Since the earlier drafts were penned there has also of course been a change of leadership (and direction) at the top of government. And Prime Minister Theresa May appointed a new cabinet, including digital minister, Matt Hancock, who replaced Ed Vaizey.

The incoming digital strategy includes what’s couched as a major a review of what AI means for the UK economy — which was trailed to the press by the government at the weekend. As the FT reported then, the review will be led by computer scientist Dame Wendy Hall and Jerome Pesenti, CEO of AI firm BenevolentAI, and will aim to identify areas of opportunity and commercialization for the UK’s growing AI research sector.

The government will also be committing £17.3M from the Engineering and Physical Sciences Research Council to fund research into robotics and AI at UK universities — so, to be clear, that’s existing funds being channeled into AI projects (rather than new money being found).

The draft strategy notes that one project, led by the University of Manchester, will develop robotics technologies “capable of operating autonomously and effectively within hazardous environments such as nuclear facilities”. Another, at Imperial College London, will aim to make “major advances in the field of surgical micro-robotics”.

But the document dedicates an awful lot of page space to detailing existing digital policies. And while reannouncements are a favorite spin tactic of politicians, the overall result is a Digital Strategy that feels heavy on the strategic filler. And heavily shaped by Brexit — while still lacking coherence for dealing with the short-term and longer term uncertainty triggered by the vote to the leave the EU.

As one disappointed industry source who we showed the draft to put it: “If you’re going to announce a digital strategy, and you’re taking in public input, why not be bold?” Perhaps because you don’t have the ministerial resources to be bold when you’re having to expend most of your government’s energy managing Brexit.

It’s the skills, stupid

Besides the government foregrounding artificial intelligence (via official press briefing) as a technology it views as promising for fueling future growth of the UK’s digital economy, the strategy puts marked emphasis on tackling digital inclusion in the coming years, via upskilling and reskilling.

Digital skills are the second of the seven “strands” the strategy focuses on, with digital connectivity being the first — a quite different structure vs the June 2016 version of the document that we reviewed (which bundled skills and connectivity into a single ‘digital foundations’ section — and expended more energy elsewhere, such as investigating the public sector potential of technologies like blockchain, and talking up putting the UK “at the heart of the European Digital Single Market”; an impossibility now, given Brexit).

A portion of the final strategy details a number of UK skills training partnerships, either new or which are being expanded, from companies such as Google, HP, Cisco, IBM and BT. Google, for example, is pledging to launch a Summer of Skills program in coastal towns across the UK.

And ahead of the strategy’s official publication the government is briefing these partnerships to press as “four million opportunities for learning” being created to ensure “no one is left behind” by the digital divide.

On the Google program the draft says: “It will develop bespoke training programmes and bring Google experts to coach communities, tourist centres and hospitality businesses across the British coasts. This will accelerate digitisation and help boost tourism and growth in UK seaside towns. This new initiative is part of a wider digital skills programme from Google that has already trained over 150,000 people.”

This again is digital strategy and spin driven by Brexit. The government has made it clear it will be prioritizing ‘control of Britain’s borders’ in its negotiations with the EU, and confirmed the UK will be leaving the Single Market, which means ending free movement of people from the EU. So UK businesses are faced with pressing questions about how they will source enough local talent quickly enough in future when there are restrictions on freedom of movement. The UK government’s answer to those worries appears to be ‘upskill for victory’ — which might be a long-term skills fix, but won’t plug any short term talent cliffs.

“As we leave the European Union, it will be even more important to ensure that we continue to develop our home-grown talent, up-skill our workforce and develop the specialist digital skills needed to maintain our world leading digital sector,” is all it has to say on that.

The focus on digital inclusion also looks to be a response to a wider framing of the Brexit vote as fueled by anger within certain segments of the population feeling left behind by globalization. (A sentiment that implicates technology as a contributing factor for a sense of exclusion caused by rapid change.) Tellingly, the strategy document is subtitled “a world-leading digital economy for everyone” (emphasis mine).

“We must also enable people in every part of society — irrespective of age, gender, physical ability, ethnicity, health conditions, or socio-economic status — to access the opportunities of the internet,” it further notes. “If we don’t do this, our citizens, businesses and public services cannot take full advantage of the transformational benefits of the digital revolution. And if we manage it, it will benefit society too.”

In terms of specific skills measures, the strategy pledges free “basic digital skills training” for adults (actually a reannouncement) — with the government saying it intends to mirror the approach taken for adult literacy and numeracy training.

It also says it intends to establish a “new Digital Skills Partnership” to bring together industry players and local stakeholders with a focus on plugging digital skills gaps locally, which sounds equally like a measure to tackle regional unemployment.

Another aim is to “develop the role of libraries in improving digital inclusion to make them the ‘go-to’ provider of digital access, training and support for local communities”.

To boost STEM skills – to help the UK workforce gain what the government dubs “specialist skills” — it says it will implement Nigel Shadbolt’s recommendations – following his 2016 report which called for universities to do more to teach skills employers need. (A need that will clearly be all the more pressing with tighter restrictions on UK borders.)

Interestingly, a 2015 draft of the strategy which we saw shows the government was kicking around various ideas for encouraging more digital talent to come into the country at that time — including creating new types of tech visas.

Among the ideas on the long-list then, i.e. under PM David Cameron and minister Vaizey, were to:

• Offer e-residency for entrepreneurs — offer some form of limited residency in the UK but require IP of business is vested in UK

• Offer Digital Corporate Citizenship — to encourage companies to vest IP in UK

• Create a new class of exceptional talent visa for those with experience of scaling up tech companies

• Create a post-study Tech Visa for applicants with degrees in computing, ICT and management who set up a tech business

Later versions of the framework drop these ideas — with the government now only saying it has asked the UK’s Migration Advisory Committee to review whether the Tier 1 visa is “appropriate to deliver significant economic benefits for the UK”.

“We recognise the importance which the technology sector attaches to being able to recruit highly skilled staff from the EU and around the world. As one part of this, we have asked the Migration Advisory Committee to consider whether the Tier 1 (Entrepreneur) route is appropriate to deliver significant economic benefits for the UK, and will say more about our response to their recommendations soon,” it writes, noting that digital sector companies employ around 80,000 people from other European Union countries, out of the total 1.4 million people working in the UK’s digital sectors.

A further section of the document references ongoing concern about the future status of EU workers currently employed in the UK, without offering businesses any certainty on that front — just reiterating a hope for early clarity during Brexit negotiations. But again, no certainty.

The two-year Brexit negotiations between the UK and the EU are due to start by the end of next month, so for the foreseeable future government ministers will be bound up with process of delivering Brexit. Which in turn means less time to devote to digital experiments to “stay at the forefront of digital change”, as one of the earlier digital strategy drafts put it.

“We also recognise that digital businesses are concerned about the future status of their current staff who are EU nationals. Securing the status of, and providing certainty to, EU nationals already in the UK and to UK nationals in the EU is one of this Government’s early priorities for the forthcoming negotiations,” the government writes now.

The original intention for the digital strategy was to look ahead five years to guide the parliamentary agenda on the digital economy. Formulating the strategy took longer than billed, and even before the Brexit vote in June 2016 its release had been delayed six-months after Vaizey opted to run a public consultation to widen the pool of ideas being considered.

“Challenge us — push us to do more,” he wrote at the time.

It’s unclear exactly why the strategy did not appear in “early 2016” (a parliamentary committee was still wondering that in July). And perhaps if it had May’s government would have felt compelled to retain more of those challenging ideas — or be accused of seeking to U-turn on the digital economy.

But, as things turned out, Vaizey’s delay overran into the looming prospect of the Brexit vote — at which point the government decided it would wait until afterwards to publish. Clearly not expecting all its best laid plans to be entirely derailed.

Since June, the wait for the strategy has stretched a further eight months –- unsurprisingly, at this point, given the shock of Brexit and the change of leadership triggered by Cameron’s resignation.

And while the process of formulating any strategic policy document is likely to involve plenty of ‘blue-sky thinking’ — thinking that never, ultimately, makes the cut as a bona fide policy pledge — it’s nonetheless interesting to see how a very long-list of digital ideas has been whittled down and reshuffled into this set of “seven strands”.

Here’s a condensed overview of May/Hancock’s digital priority areas:

• Digital connectivity — on this the government mainly appears to be touting existing policies, such as a universal service obligation for broadband (with a floor of 10Mbps connection); free wi-fi on trains; and £1BN for fiber and 5G. The government also says it intends to “ensure adverts for broadband accurately reflect the speeds and technology actually on offer for the majority of customers” — something Vaizey had criticized when in post
• Digital skills — another section padded out with a lot of policy reannouncements, but which generally puts a lot of emphasis on longer term digital upskilling of the local population, as noted above, including flagging up corporate training partnerships
• Making the UK the best place in the world to start and grow a digital business — this section reiterates the previously announced extra £4.7BN in R&D funding from the Autumn Statement; on top of that there’s the AI review; and a commitment to put expert teams in UK embassies in five developing countries “tasked with driving UK economic growth by partnering British companies with innovative local start-ups”. (This will be based on an existing ‘UK Tech Hub’ in Israel, with the focus being on driving collaboration on R&D, skills, innovation and tech and “forging a deeper, more strategic commercial and research relationship” between countries — yet doing so remotely, on their soil.) Also here the government talks about wanting to balance regulation so it’s friendly to “disruptive digital innovations” yet also “continues to protect the public”. So there’s no clarity on that. It also says it wants a “flexible and dynamic” IP regime. When it comes to commercializing research, it says it’s asking BEIS’s Chief Entrepreneurial Advisor, Professor Tim Dafforn, to lead a review to “take stock of the support currently available to entrepreneurs”.  “The review will examine the entire entrepreneurial journey, focusing on the motivations and opportunities for those embarking on business ventures, from education to business development and growth.”
• Helping all British businesses to embrace digital — this section includes another reannouncement from the Autumn Statement of £13M to create a private-sector led productivity council to encourage “appropriate use of digital technologies”. Otherwise the government says that it will “work to focus existing initiatives, and plug gaps where there are specific challenges”. And, for the manufacturing sector, Juergen Maier, CEO of Siemens UK, will lead a review of industrial digitalisation, due to report findings in the summer. The report also touches on the concept of a common identity framework, with the government saying it will work with industry/relevant stakeholders/interest groups on adopting open standards, especially for validating identity
• Making the UK the safest place in the world to be online — a section that feels like a repackaging of the prior government’s prioritizing of cyber security, with the strategy flagging up the role of the already established National Cyber Security Centre, along with a reiteration of certain sections of the Digital Economy Bill (specifically those aiming to use age verification checks online to try to ensure children do not access adult content). Though a pledge to establish a national after-school program “for the most talented students, cyber apprenticeships, and adult retraining” may be a new measure
• Maintaining the UK Government as the world’s leader in serving its citizens online — this references the Government Transformation Strategy, which was published on February 9, and says the plan is to continue to develop single cross-government platform services — working towards 25M GOV.UK Verify users by 2020 (plus some new services on other gov.uk platforms). There’s also a stated intent for government to consume “commodity hardware or cloud based software” instead of building something it dubs as “needlessly government specific”. So probably good news for Amazon, Google et al
• Unlocking the power of data and improving public confidence in its use — here the government reconfirms the UK will be implementing the incoming new EU data protection regulation, the GDPR, by May 2018. And talks generally about wanting to encourage “innovative uses of data” while also providing “robust protection for people’s privacy rights” and the ability for users to access their data. So again, it’s rather cake-and-eat it (apt given Brexit). It says it will work with organisations such as the Open Data Institute to encourage use of APIs, flagging up work having already started on developing an Open Banking API for UK consumers using banking services. It also underscores a “shortage of data talent” as having “direct and serious economic implications” — so says addressing that shortfall is a strategic priority. (And on that it says it will work to implement “key elements” of the Analytic Britain report produced by Nesta and Universities UK.) On government data, it says it will appoint a new chief data officer to lead efforts to streamline data infrastructure. It also reiterates its intent, again via the Digital Economy Bill, to “share data across organizational boundaries within the public sector” to power “better targeted services” and to tackle fraud. But there’s no mention of the privacy controversy raging over these proposals — with the only check on what could be very wide-ranging powers for the public sector to more closely track citizens via joined up data-sharing being the caveat: “where appropriate”

We asked UK entrepreneur, Tom Adeyoola, co-founder and CEO of London-based startup Metail to review the strategy draft, and here’s his first-take response: “I don’t really see a strategy. It’s very disappointing that it doesn’t explicitly talk about the shock that is coming [i.e. Brexit] and how the government intends to counteract it. That’s what I want from a strategy: Here is what we are going to do to prevent brain drain. Here is what we are going to do to fill the gap from European money and here is how we are going to keep our research institutions great and prevent against the likes of Oxford thinking about setting up campuses abroad to enable and prevent loss of potential talent for research.”

He dubbed Brexit the “elephant in the report”.

Some of the more blue-sky-y tech ideas that were being entertained on the strategy long-list in 2015, back when Brexit was but a twinkle in Cameron’s eye, which never made the cut and/or fell down the political cracks include: encouraging as much as a third of public transport to be on-demand by 2020 and driveless cars to make up 10 per cent of traffic; reducing peak hour congestion by use of smarter, sensor-based urban traffic control systems; launching a couple of universal smart grids in UK towns; establishing a fully digitized courts system to support out-of-court settlements; building the first drone air traffic control system; and establishing a “clear ethical framework or regulatory body” for AI and synthetic biology.

And while the final strategy draft does mention the societal implications of AI as an area in need of “careful consideration”, there are — yet again — no concrete policy proposal at this point. Despite calls for the government to be exact that: proactive. But apparently it’s hard to be politically proactive on too many emerging technologies with the vast task of Brexit standing in your way.

Last word: a note on “diplomacy” in the 2015 strategy draft suggests the government “advocate for free movement of data inside EU”. UK-EU diplomacy in 2017 is clearly going to cut from very different cloth.