UK should focus on I&L space to become ‘superpower’: Segro

Segro’s Park Royal estate, London.

The UK government’s announced intention to make the company a “technology superpower” by 2030 is destined to fail, because it is too focused on research at the expense of infrastructure, according to research commissioned by UK REIT Segro.

Howerver, if the UK could meet suppressed demand for warehouses and industrial workspace it could add £68 billion to the country’s gross value added, and generate 1.1 million jobs, the research found.

“If politicians want to develop a serious strategy to put the UK at the forefront of technological development, they need to reform the state and work with businesses to develop the industrial infrastructure that the UK desperately needs,” said Andrew O’Brien, director of policy and impact at Demos, the cross-party think-tank hired by Segro.

Over 350,000 businesses lack access to the right buildings and facilities, according to Demos.

The government launched its plan in March 2023 to secure the UK’s place as a science and technology superpower by 2030. A raft of new measures was announced, backed by over £370 million, with the aim of bringing the world’s best talent to the UK and seizing the potential of new technologies such as artificial intelligence.

Currently, this policy is destined to fail, according to a Segro statement issued as the report, Powering the Superpower, was published. “The UK is not on track to become a technology superpower by 2030 due to a lack of investment in the country’s industrial infrastructure, which is a significant barrier to the ability of the UK economy to grow.”  

“There is too much focus on boosting spending on R&D and not enough focus on the link between the UK’s physical infrastructure, including buildings and facilities,” the report states.

Demos’ research found that more than 350,000 businesses, with a collective turnover of £666 billion and employing 3.8 million people, lack access to the right buildings and facilities. About 30% of businesses surveyed said they are not confident the UK will be an attractive place to do business in a decade’s time, according to the findings.

The report also outlined a six-point plan to help the UK develop the industrial infrastructure it needs: Firstly, address industrial infrastructure needs; merge the National Infrastructure Commission with the UK National Infrastructure Bank to create super agency, the National Infrastructure Delivery Authority (NIDA); presume in favour of developing industrial infrastructure; increase government spending on local authority planning teams; give industrial infrastructure projects priority for grid access; extend Investment Zone structures and buildings allowance tax rules to cover the whole UK.

“There is a big gap between the rhetoric and reality of the UK’s aspiration to be a technology and science superpower by 2030,” said O’Brien. “Government needs to recognise that the key barrier to becoming a technological superpower is not our ability to innovate, but our physical ability to develop and deploy new technologies.”