UK-based Tech Companies

Mike Martin Excerpts

Wednesday 11th March 2026 Westminster Hall

[Mike Martin (Tunbridge Wells) (LD)]

It is an honour to serve under your chairship, Mr Betts. I congratulate the hon. Member for Bromley and Biggin Hill (Peter Fortune) on securing this important debate. We have heard from both sides of the Chamber that the British tech sector spreads into all our constituencies, so it concerns us all.

When the Government came to power, they said that their central mission was to provide growth. I posit that a key way to do that is by supporting our small and medium-sized businesses, because that is where growth comes from.

[Rachel Gilmour (Tiverton and Minehead) (LD)]

Does my hon. Friend share my view that, although we can be rightly proud of having the third most valuable tech ecosystem in the world, we cannot be complacent, especially amid increasing international uncertainty? Shearwell Data in my constituency is exactly the sort of business that he refers to. A family-run business, founded by Richard Webber in 1992, it now exports livestock management systems internationally. Mr Webber is a true local champion: he not only runs that fantastic family businesses, but works at the heart of our community in Wheddon Cross. Does my hon. Friend agree that the flight of UK tech companies to other markets such as the United States shows that we must do more to ensure British companies can start, stay and scale here?

[Mike Martin]

I thank my hon. Friend for her comprehensive intervention, which speaks to exactly the issues that I will raise.

The key example is DeepMind, which was the world-leading AI company. We, the Brits, failed to create the ecosystem, funding and risk-taking capital to enable it to scale fully. It was then bought by Google, and now the British Government contract with Google rather than with DeepMind. That is exactly my fear: even though we are the world’s third AI power, that could move away from us very quickly if we do not create the right ecosystem to support our tech firms.

If this Government are serious about supporting growth, we need to look at small and medium-sized enterprises. It will not surprise hon. Members that I have some examples from my Tunbridge Wells constituency. First, Capital Web develops AI software to help businesses to improve productivity. That is on the application side of AI; we are never going to compete on the frontier model side of AI, but the UK can certainly compete on how we implement those frontier models to work cases. I will also give a bit more detail about Adzuna, a firm based in Tunbridge Wells that helps people to find jobs.

The problem in the UK is one of scaling up. We often have support for businesses that are very small. We might have research and development tax credits or innovation grants, or we might help them to spin directly out of universities. However, what just does not happen in the UK is moving them on from the position where they have a concept and patent and are perhaps ready to scale rapidly. Those firms are left to go abroad, be taken over, or perhaps wither and see the market move on and eclipse them. That is the real danger.

[Dan Aldridge (Weston-super-Mare) (Lab)]

I held a roundtable in my constituency with the Startup Coalition just two weeks ago. We found that one of the biggest barriers was not an absence of talent or expertise in my town, but a poverty of access to information, advice and guidance. No one had heard of small business start-up loans, the £500 to £25,000 Government-backed loans, which are really critical. That was one of the things people critically needed. That is a big issue. I would ask the Minister how we improve communication to places such as Weston-super-Mare.

[Mike Martin]

That is an excellent point. It is very much something that the Government can do, because they understand where capital can be found and how to create the legal and regulatory ecosystem that enables these companies to thrive.

Let me touch briefly on access to capital—I am thinking of slightly larger amounts than those the hon. Gentleman just mentioned. Pension funds are a huge source of capital. In the UK, trillions are under management in our pension funds. This is something that Canada does very well. Canada’s pension funds operate almost like specialist investors, pumping billions of dollars into AI, infrastructure and software. To pick another example that is dear to my constituency, South East Water, which many hon. Members will have seen me rail against, is 25% owned by NatWest pensions—our favourite cuddly UK bank—which makes its money by selling debt to South East Water at a rate of 10% interest. That is not pension fund investment that is driving growth in the UK. We must do better. We must think about how we can push and guide our pension funds, and all those millions that are under investment, to invest in growth sectors in the UK, rather than going abroad.

Let me turn to reforming public procurement. At the worst end of the spectrum is probably the Ministry of Defence, where it takes six years from first contact to signing a contract. That is just to sign the contract, not to deliver the piece of military hardware and test it or have it in service. The stories out of MOD procurement would not be out of place in an episode of “The Thick of It”.

That is the worst case, but then there is the Department for Work and Pensions. Andrew in my constituency founded Adzuna, which is effectively a super-duper job search thing that uses AI to match people’s profiles to the skills needed and so on. It took him two and a half years from approaching the DWP to signing a contract. Andrew started out with a laptop at his kitchen table, and businesses that size cannot wait two and a half years. Cash is king—and they will either have gone out of business or decided to go somewhere else by the time that contract is offered.

Whether in defence, where people actually need to contract much more quickly because of the pace of technological change, or Government, who actually need an effective job search tool on their websites, these timescales need to be compressed. In that way the Government will open themselves up much more to small firms instead of just the big firms that are able to take two and a half years on a punt for a contract with the DWP.

To sum up, there are a number of things that the Government could do around information sharing—I thank the hon. Member for Weston-super-Mare (Dan Aldridge) for making that point—and access to capital, particularly encouraging pension funds to invest. They should also look at procurement and focusing that on small businesses, because small businesses are the ones that deliver growth. That is where we get growth in our economy—much more so than from big businesses. The Government have a huge set of levers to pull, so I implore the Minister, “Could we perhaps start pulling them?”. I look forward to his remarks.