Theresa May's administration set out to rebuild the United Kingdom's economy after Brexit by putting technology at its center. The plan included fresh funding for artificial intelligence, 5G networks and robotics; a points-based immigration system for skilled workers; and a drive to grow tech hubs outside London. The sector responded with a mix of optimism and skepticism. Boris Johnson's government overtook the strategy before most of its flagship policies could be implemented. May resigned as Prime Minister in July 2019, and the UK formally left the European Union on 31 January 2020. The specific branding and comprehensive approach outlined in this period was largely superseded by subsequent digital and AI programmes.
The announcement landed at a delicate moment in the Brexit timeline. The UK had triggered Article 50 on 29 March 2017, beginning the formal two-year negotiation process. The Conservative Party manifesto for the June 2017 general election pledged to make the UK a global front-runner in science and technology. The administration needed to show that leaving the EU would not damage one of the country's fastest growing sectors.
Funding Pledges for AI, Robotics and 5G
The administration committed new public money to what it described as the technologies of the future. The figures were presented as part of a broader industrial plan that positioned tech alongside traditional manufacturing and services. Funding was allocated to artificial intelligence research, robotics and autonomous systems, and the rollout of 5G networks. The sums were intended to match or exceed what other European states were spending on similar programmes.
The AI component was the most prominent. The administration wanted the UK to be the world leader in ethical AI development, a claim that drew on the strength of university computer science departments in Oxford, Cambridge and Edinburgh. The robotics funding was directed at manufacturing automation, aiming to keep UK factories competitive as labour costs rose. The 5G money was framed as infrastructure investment, necessary for everything from autonomous vehicles to remote surgery.
Immigration Rules for Skilled Tech Workers
Ending Free Movement
The immigration system was the most contentious part of the plan. The administration proposed a new regime that would prioritise skilled workers, including those in technology roles, over lower-skilled migration. The details were vague, but the direction was clear: after Brexit, the UK would no longer apply the EU principle of free movement. Instead, it would design a points-based system that favoured people with job offers in sectors where the UK faced shortages.
Industry Alarm Over Talent
Tech companies had been warning for years that they could not find enough domestic engineers, data scientists and software developers. The sector relied heavily on EU nationals, who made up a significant share of the London startup workforce. The proposed system was meant to reassure them that they could still hire from Europe, but with more paperwork and higher salary thresholds. Critics argued that the uncertainty of the transition period would drive talent to Berlin, Paris or Dublin before the new system even started.
Regional Tech Hubs and Investment Strategy
Mapping the New Clusters
The administration promised to spread technology investment beyond London and the South East. The plan identified cities including Manchester, Birmingham, Edinburgh, Cardiff and Belfast as potential tech hubs. Each would receive support for co-working spaces, university-industry partnerships and local venture capital funds. The goal was to create a network of technology clusters that could compete with London on cost of living and quality of life.
Accelerating a Trend
The approach drew on data from Tech Nation, the industry network, which showed that the UK's digital tech sector was growing faster than the wider economy in 2016 and 2017. Most of that growth was concentrated in London, but secondary cities were catching up. The administration wanted to accelerate that trend by investing in digital infrastructure and offering grants to startups that relocated or opened offices outside the capital. The plan was popular with politicians in northern and Scottish constituencies, but some tech founders questioned whether state intervention could replicate the network effects that made Silicon Valley and London successful.
Data Protection and Digital Regulation After GDPR
Securing an Adequacy Decision
The administration faced a specific challenge on data regulation. The EU's General Data Protection Regulation came into force in May 2018, while the UK was still a member state. After Brexit, the UK would need its own data protection framework that was compatible with the EU's, otherwise data flows between the UK and its largest trading partner would become illegal. The strategy promised a regime that was at least as robust as GDPR, with the aim of securing an adequacy decision from the European Commission.
Platform Rules and Compliance Costs
The plan also addressed digital regulation more broadly. The administration proposed new rules for online platforms, including measures to tackle harmful content and protect children. These were presented as part of a British approach to internet governance that would be more agile than the EU's. Industry bodies warned that diverging from EU rules could create extra compliance costs for startups that operated across borders. Privacy campaigners argued that the administration's commitment to high standards was not backed by enforcement resources.
Industry Reaction: Optimism and Skepticism
Welcomed, With Caveats
UK tech sector trade bodies welcomed the administration's attention but expressed caution about delivery. The sector had been lobbying for a dedicated tech visa, more R&D tax credits, and a commitment to keep data flowing freely after Brexit. The strategy addressed all three, but the details were thin. Trade associations said they would judge the plan by its implementation, not its rhetoric.
Founders Divided
Prominent founders were split. Some saw the strategy as a genuine attempt to build a post-Brexit economy that did not depend on financial services. Others viewed it as a political gesture that would not survive contact with the reality of the negotiation process. The uncertainty of the transition period was the dominant concern. Companies could not plan for five years ahead when they did not know whether the UK would leave the EU with a deal, without a deal, or at all. The strategy did not resolve that uncertainty, and the sector's response reflected that.
Tax Incentives and the Plan's Legacy
Protecting Early-Stage Funding
The strategy included measures to improve the tax environment for startups. The administration committed to maintaining and expanding R&D tax credits, which allowed loss-making technology companies to claim cash back from HMRC on their research spending. It also promised to review the Enterprise Investment Scheme and Seed Enterprise Investment Scheme, which gave tax relief to angel investors. These programmes were already popular with the tech sector, and the administration's pledge to keep them was seen as a signal that it understood the importance of early-stage funding.
A Superseded Agenda
The plan did not survive the change of prime minister. Boris Johnson's administration launched its own digital programme with different priorities, including a greater focus on quantum computing and a more aggressive approach to AI regulation. The specific branding of May's initiative was dropped. The UK left the EU on 31 January 2020, and the transition period ended on 31 December 2020. The tech sector continued to grow, but the comprehensive strategy that May had outlined was largely superseded. The questions it raised about immigration, data flows and regional investment remained unresolved.
Key Facts
- Prime Minister: Theresa May, served July 2016 to July 2019
- Brexit referendum: 23 June 2016
- Article 50 triggered: 29 March 2017
- UK left EU: 31 January 2020
- Sector growth: UK digital tech sector growing faster than wider economy in 2016-2017, per Tech Nation
- Conservative manifesto pledge: Make UK a global leader in technology and science, June 2017 election
FAQ
Did Theresa May's tech strategy survive her premiership?
No. The specific branding and comprehensive strategy was largely superseded by Boris Johnson's administration after May resigned in July 2019.
What was the main concern of UK tech companies about the plan?
The uncertainty of the Brexit transition period. Companies could not plan for the future when they did not know whether the UK would leave the EU with a deal, without a deal, or at all.
How did the plan address data protection after Brexit?
The government promised a data protection framework at least as robust as GDPR, with the aim of securing an adequacy decision from the European Commission to allow data flows to continue.
