21/03/2012 10:37 GMT | Updated 21/05/2012 06:12 BST

Europe's Technology Centre?

Chancellor George Osborne announced his intention to ensure Britain becomes Europe's technology centre in his Budget speech. In order to make this a reality he announced support in two areas: Digital Content; and Infrastructure.

Digital Content

The Chancellor announced the corporation tax reliefs from April 2013 for the video games, animation and high-end television industries. These reforms will be subject to consultation and will need to pass state aid rules. The film industry already enjoys reliefs of this kind.

The aim of this tax relief is to try and retain these industries, and the jobs they create, in the UK. It is also hoped that it will encourage inward investment from the likes of Disney into the UK. Last autumn it was reported that animation studios were planning to leave the UK because of preferable tax breaks and subsidies in countries including Ireland and Canada. This move is clearly designed to address that issue and signal to similar creative industries that they are valued.


On infrastructure, the Chancellor confirmed the selection of Belfast, Birmingham, Bradford, Bristol, Cardiff, Edinburgh, Leeds, Manchester, Newcastle and London to become broadband Super-connected cities. This move is part of a previously announced £100m investment. The Treasury says that this investment will this will deliver ultrafast broadband coverage to 1.7 million households and 200,000 businesses, and high speed wireless broadband for three million residents by 2015.

In terms of mobile networks, rural areas and selected A-roads will see an increase in the quality of coverage. There will also be a government review to decide whether intervention is required to improve mobile coverage for rail passengers.

The UK's broadband and mobile phone infrastructure isn't exactly the envy of the world and improving it is essential. As my colleague Charlotte from our Hong Kong office noted recently, we don't even have wifi on the Tube. The Chancellor also alluded to the fact our network is sub-par when he noted that, "Two years ago Britain had some of the slowest broadband speeds in Europe."


At first glance, the creative industries can be broadly pleased with the outcome from this budget. The video games developers and animators in particular will feel their voice is being heard and the benefits they bring to the UK are being recognised.

On infrastructure, it's all a little less clear cut. Additional investment is, of course, welcome but until the details are reviewed, it's hard to judge how significant these announcements are.

The announcements for technology were underpinned with additional announcements about youth training, business loans and development zones. There were also measures supporting scientific and engineering research. It all pointed to the Chancellor wanting to lessen the economy's reliance on financial services but keep Britain very much as a service-based, intellectual property creating economy.