Does the EU hinder or help the UK tech sector?

Pictfor, the Parliamentary Internet, Communications & Technology Forum convened a panel of guests from all corners of the tech world to consider the ramifications of both a vote to leave the EU and the vote to stay.

Pictfor's panel of experts
Pictfor's panel of experts

The BBC's technology correspondent Rory Cellan-Jones led an APPG Pictfor meeting yesterday to discuss whether or not the EU helps or hinders the UK tech sector, and unsurprisingly no one could quite reach a uniform conclusion.

Pictfor, the Parliamentary Internet, Communications & Technology Forum convened a panel of guests from all corners of the tech world to consider the ramifications of both a vote to leave the EU and the vote to stay.

A recent Tech Nation report showed that the UK's digital tech industries grew faster than the rest of the economy between 2010-2014. The number of jobs in the sector grew by 11.2% over the same period, showing the sector's capacity to generate jobs was three times faster than the rest of the UK economy.

Opening the discussion panel, Julian David, CEO of techUK, a consortium which represents 900 UK based tech companies, told the audience of research the company recently conducted within its members which highlighted that fewer than one in ten believe the practicalities of leaving the EU are well understood, and 70 percent would like to stay within the EU, with 15 percent wanting to leave, and 15 percent undecided.

Once he offered insights into the opinions his members have on the Brexit, David went on to say, “The UK government has got to work on making the EU better, so we can make the tech scene what it could be.”

Offering more controversial views to the panel, Peter Chadha, CEO of DrPete Inc, stated outright that he is a Euro-sceptic, all the way back from the 90s as, “It didn't pay tax and was full of politics.” He added that his points of views come from a purely business perspective.

Drawing much disapproval from some audience as spoke of the votes which the EU has taken that have gone against the UK government, Chadha said, “We don't have any influence on Europe.”

Attempting to explain his points, Chadha exclaimed that, “We joined in the 70s, which was a different time for the UK economy. Today we're stronger and far more competitive on the world stage. 1985 was probably the peak of economic integration with EU. Since then, the commissioners have been busy building the EU super-state which doesn't really take into account the needs of 28 member states which all have disparate economies.”

He added: “The EU is expensive, it costs us £55 million a day and we simply don't need it”, and quoted the internet cookie policy the EU introduced asking what's the point of it. The audience scoffed.

Bindi Karia, formerly a VP of the Silicon Valley Bank and VC/Emerging Business Lead in the UK for Microsoft, was responsible for working with entrepreneurs, investors, universities, and influencers to position Microsoft as a leading supporter of innovation and growth in the UK. 

Karia spoke of the UK's influential lead in the startup scene, saying, “It is because of the Digital Single Market that people want to get involved in the UK's tech and startup scene, and a lot of startups come from the EU to the UK to seek funding, bringing their business with them.”

Stating that leaving the EU would be damaging because of this, Karia said, “Most fintech startups would move their HQs out of the UK because the Brexit would make it difficult to employ the right people with the right skills needed in the tech sector.”

She went on to also warn of the general uncertainty that is looming, giving the example of a startup in the UK losing £150,000 of German funding as the investors wait to hear results of the vote in July. 

Karia closed her statement by saying, “The UK is a powerhouse - if we do want to leave we need to consider if we are willing to give away that power.”

COO and co-founder of Onfido, Eamon Jubbawy, promoted a very pro-EU stance: “As a company that does background checks for the ‘sharing economy' for services which operate all over the world, we as a company naturally feel we operate in a borderless world.”

Onfido, as described by Jubbawy, is a startup that rents out its background checking technology to companies who operate within fintech and the ‘sharing economy' space, so that when a person rents out an AirBNB flat, the owner can verify they are who they say they are, Uber drivers get properly background checked and Deliveroo drivers don't run away with your food.

Jubbawy said that as their income comes from all over the world, and most of their talent comes from the EU, it would be all counterintuitive for the UK to leave the EU as the UK is not currently able to provide the skills and talent they need. Jubbawy finished by stating that, “Leaving the EU is a risk [the UK] simply cannot account for.”

Man-on-the-ground and member of the European Parliament for West Midlands, Daniel Dalton, echoed a pro-EU stance asking the audience, “If the UK is so strong, why are we so fearful of leaving the EU? Not using a 500 million people strong market which is right next door to us would impose a huge handicap on the UK economy.”

Reminding the audience of the Juncker Commission's aim is to create a Digital Single Market — where the free movement of goods, persons, services and capital is ensured — Dalton highlighted that no one who is in favour of the UK leaving the EU has offered a sensible solution yet which explains how are we going to manage trading with the EU without it.

Dalton closed his statement by saying, “If the UK does decide to leave the EU we're going to be on the outside of the market.”

Closing the debate, Chi Onwurah, Labour MP for Newcastle Upon Tyne Central, said, “The tech sector forms the basis for why the UK should stay in the EU. EU debates can be frustrating, as there are 28 members states, but we all want the same thing. The UK is driving discussion and progress in many areas including better broadband and data protection policies.”