The Labour authorities, which got here into energy again in July 2024, has confronted an unprecedented approval disaster.
Critics from throughout the political spectrum have voiced considerations to such a level that Sir Keir Starmer has turn into one of many least widespread prime ministers in historical past, in response to YouGov approval rankings.
However confronted with photographs in opposition to insurance policies from immigration to digital ID, the federal government has made clear its major aim stays supporting companies and reaching financial progress.
Whereas most of the people has voiced its discontent, new information means that on that entrance not less than, the federal government could also be doing higher than anticipated.
The brand new tech-focused analysis marketing campaign from audit, tax and consulting adviser RSM UK has taken a take a look at the sentiment amongst British tech companies on their confidence within the present administration.
Tech business backs Labour
Over three-quarters (76%) of tech enterprise respondents agreed that they felt extra assured that their enterprise will develop beneath the present Labour authorities, whereas solely 11% disagreed.
Whereas Starmer’s critics could also be shocked at these findings, for tech companies, latest coverage bulletins associated to the governments Fashionable Industrial Technique have confirmed efficient.
Among the many hottest of those are tax incentives and laws to spice up abroad funding, the reformation of planning guidelines to permit fast development of latest digital infrastructure, motion to make vitality prices simpler for corporations to cope with and plans to simplify technological regulation.
“Our survey of know-how enterprise leaders gives a data-backed yardstick of UK tech confidence. Behind all of the noise, confidence inside UK tech stays bullish,” mentioned Ben Bilsland, accomplice and head of the know-how business at RSM UK.
“The federal government has been constructive about know-how and AI as an business that may unlock financial progress. Nevertheless, widespread adoption of AI and different applied sciences to enhance efficiencies will solely take the UK thus far.”
Bilsland mentioned the federal government can “stimulate innovation” by way of insurance policies that immediately deal with the “rising expertise hole in our workforce” in addition to present assist by way of “direct funding and tax insurance policies to reward analysis and improvement actions and recruitment”.
Worldwide progress
One other widespread coverage amongst UK tech companies was the federal government’s efforts to safe new worldwide commerce offers, which have been negotiated within the likes of India, France and the US.
Worldwide growth is a standard aim for tech companies, and RSM UK’s findings have advised amongst British companies two areas stick out specifically, Europe and North America, seen as strategically necessary by 61% and 58% of corporations respectively – curiously when filtered for London-based companies, North America was marginally the extra widespread alternative.
It isn’t too stunning that these areas are seen as a very powerful for British tech companies, each providing giant markets with shut ties to the UK, one thing Bilsland mentioned will “probably stay for the foreseeable future”.
Regardless of latest risky coverage shifts seen within the US, notably ever-changing tariffs and immigration guidelines, it stays a key goal within the UK.
As many as 86% of respondents felt both considerably extra enthusiastic or rather more keen about doing enterprise with the US over the previous 12 months.
Technological collaboration alternatives and market demand within the US have been the most typical elements affecting this, with diplomatic relations and commerce laws additionally talked about.
Although there stays vital enthusiasm, RSM UK notes that political uncertainty within the States should be negatively impacting companies emotions in direction of different worldwide alternatives.
“One shift we’ve got observed in 2025 has been deeper consideration by UK tech firms of abroad markets outdoors of the US,” Bilsland mentioned.
“Whereas the UK tech sector has not been as impacted by US tariffs as different industries, it has inspired UK tech firms to mirror and take into account different markets in additional element alongside the US.”
Overseas funding
Curiosity within the US and Europe is especially well-founded when sources of funding.
Among the many respondents that secured funding over the previous six months, 49% mentioned it included funding from European VC and PE corporations and 50% from US buyers.
That is solely barely decrease than the 67% which secured funds that embrace UK-based buyers.
Abroad funding kinds a robust a part of the UK tech ecosystem and for Bilsland it’s no marvel why.
“The UK boasts glorious innovation credentials alongside providing many incentives to run a enterprise. Tech firms will proceed to look in each the UK and globally to seek out the most effective buyers and companions,” he mentioned.
“As extra abroad VC funds and PE homes improve their possession of UK companies, UK home VC and PE will proceed to face rising competitors to take a position.”
Bilsland believes this exercise shall be a constructive for UK tech, with constant capital funding wanted for progress.
“That mentioned, all eyes shall be on the Autumn Funds and specifically tax insurance policies round funding, as modifications right here might have a major impression.”
