On 25 November 2020, the Chancellor of the Exchequer, Rishi Sunak MP, delivered his 2020 Spending Review.
During his oral statement to the House of Commons the Chancellor announced measures to deal with the effects of Coronavirus. He stated that it was the Government’s ‘immediate priority to protect peoples’ lives and livelihoods’. The Chancellor stated that the economic emergency ‘was not yet over’. The Chancellor also announced that Government was publishing a National Infrastructure Strategy and establishing a new UK Infrastructure Bank.
Key fiscal projections:
|Percentage change on a year earlier, unless otherwise stated|
|Public sector net borrowing (£ billion)||56||394||164||105||100||100||102|
|Public sector net borrowing (percentage of GDP)||2.5||19.0||7.4||4.4||4.1||3.9||3.9|
|Public sector net debt (percentage of GDP)||85.5||105.2||108.0||108.6||109.4||105.0||104.7|
The key Spending Review announcements relevant for the video games industry are:
- £1.2 billion to subsidise the rollout of gigabit-capable broadband, as part of the government’s £5 billion commitment to support rollout to the hardest to reach areas of the UK
- Investing in local infrastructure, local transport and digital connectivity to ensure that the services people use most often are well-maintained and accessible in all places, to help provide high-quality 4G mobile coverage and rollout gigabit-capable broadband across the UK
Upskilling for the Future:
- Investing in Further Education to ensure that core funding for 16 to 19-year-olds is maintained in real terms per learner, rising in line with demographic growth
- Delivering opportunities for lifelong learning, helping those who want or need to reskill to do so at any stage of their life or career
- Confirming changes to support employers offering apprenticeships by delivering further improvements to the system.
Investing in Digital:
- £1.2 billion from 2021-22 to 2024-25 to support the rollout of gigabit-capable broadband across the UK, essential in an increasingly digital age for supporting the UK economy. This is part of the government’s £5 billion commitment to support gigabit-capable broadband rollout to the hardest to reach areas of the UK
- £50 million next year, as part of a £250 million commitment to building a secure and resilient 5G network
- Over £200 million UK-wide to continue flagship digital infrastructure programmes, including the Shared Rural Network for 4G coverage, Local Full Fibre Networks, and the 5G Testbeds and Trials Programme
- £45 million for programmes to drive growth through digital technologies and data, while improving online safety and security
Culture and Heritage
- Over £150 million to continue to strengthen cultural and heritage infrastructure, including through the Cultural Investment Fund and Museums Infrastructure Fund, enabling the development of British Library North and continued investment in the Heritage High Streets programme.
- Over £100 million of capital investment for DCMS-supported bodies working across culture, heritage, and sports.
- Over £320 million for galleries and museums.
- Over £150 million in 2021-22 for upcoming major events, including the 2022 Commonwealth Games in Birmingham, Festival UK and the celebrations for the Queen’s Jubilee
The Government also published their National Infrastructure Strategy. A summary of the key elements relevant for the video games industry can be found below:
- The UK has the fifth largest number of broadband and mobile subscriptions in the OECD,15 and more people in the UK shop online than in any EU member state.
- More than a third of UK premises now have access to gigabit-capable connections, up from 9% when the government took office in July 2019. By next year, more than half of all premises will have access.
- The Government has pledged £5 billion to support UK-wide gigabit broadband roll-out, a Shared Rural Network extending 4G mobile coverage to 95% of the UK, and £250 million to ensure resilient and secure digital networks.
- The government is working with industry to target a minimum of 85% gigabit capable coverage by 2025 but will seek to accelerate roll-out further to get as close to 100% as possible. The Government will continue to implement an ambitious programme of work to remove barriers to broadband deployment and maximise coverage in the hardest to reach areas of the country.