Science & Tech

Igniting Innovation

How the UK can lead in emerging tech regulation

Allan Nixon, Ben Greenstone

September 25, 2024

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Igniting Innovation

Full Report

"We are observing a wave of growth in innovation right here in the UK. However, this opportunity is at stake of falling victim to the ambition-stifling and aspiration-limiting touch of over-regulation. This must not be allowed to happen. I commend this report’s efforts to set out this case.”

Andrew Griffith, Shadow Secretary of State for Science, Innovation and Technology

Britain urgently needs to reform its failing regulators to unlock innovation and drive growth. A lack of resourcing, coordination and restraint by Britain’s patchwork of regulators is holding innovative firms back, leaving investors looking abroad.

The Financial Conduct Authority has hit just two-thirds of its targets. The Food Standard Authority (FSA) has failed to set guidance on gene editing despite new legislation last year and has only approved 14% of the requests it received since 2021. The Civil Aviation Authority is yet to authorise a drone flight out-of-sight for remote pilots, while the US and Japan did so two years ago.

Regulators are failing because they are under-resourced and overstretched. The FSA hasn’t kept up with the pace of development on novel foods. The MHRA has cut its workforce by a fifth. A senior data scientist in industry would have to take a 40% pay cut to work at Ofgem. Ofcom is being asked to make policy decisions such as when and where to verify ages. The CMA was empowered to unilaterally demand changes to large firms’ business models.

They are also out-of-reach of the Government. Even when the Government fundamentally disagrees with a decision, it has no powers to overrule beyond publicly criticising. Ministers are also unwilling to attempt to rein them in with the few powers they have. It took ten years for the last Government to consult on Ofgem’s strategy, and Ofcom was last issued a strategic steer in 2019 – and not updated since the new Online Safety Bill substantially grew its powers.

A new report by Onward, Igniting Innovation, urges the Government to radically rethink regulation to unlock innovation and deliver growth.

Mar 31

11:30-

12:30

Lessons Learned: An in conversation with the Shadow Education Secretary

with:

Laura Trott MBE MP

Recommendations:

Create a ‘call-in’ power to allow the Government to overrule regulators on individual decisions.
Requiring sunset clauses on new regulation of emerging technologies to force them to be reviewed and renewed to stay updated.
Put the planned Regulatory Innovation Office on a statutory footing and give it powers to compel regulators to coordinate their rules and actions.
New legislation on emerging technologies should automatically exempt small businesses and business-to-business products and services, unless explicitly stated otherwise.

The Government should launch a “Lead Regulator” pilot to streamline innovator touch points with regulators, including creating a single point of contact for innovative businesses.
Expand the fast-track approval routes that rely on the recognition of trusted countries’ recognised regulators’ decisions.
The Government should create a central “Innovator Taskforce” that can be deployed to regulators to support on specific, time-limited issues.
The Government should create a “Regulatory Innovator Tour of Duty Programme” to second innovators from industry to regulators, and regulators to innovators, building capacity and knowledge on both sides.
The Government should standardise how strategic steers are issued and should be renewed at least every two years.

Recommendations:

Create a ‘call-in’ power to allow the Government to overrule regulators on individual decisions.
Requiring sunset clauses on new regulation of emerging technologies to force them to be reviewed and renewed to stay updated.
Put the planned Regulatory Innovation Office on a statutory footing and give it powers to compel regulators to coordinate their rules and actions.
New legislation on emerging technologies should automatically exempt small businesses and business-to-business products and services, unless explicitly stated otherwise.

The Government should launch a “Lead Regulator” pilot to streamline innovator touch points with regulators, including creating a single point of contact for innovative businesses.
Expand the fast-track approval routes that rely on the recognition of trusted countries’ recognised regulators’ decisions.
The Government should create a central “Innovator Taskforce” that can be deployed to regulators to support on specific, time-limited issues.
The Government should create a “Regulatory Innovator Tour of Duty Programme” to second innovators from industry to regulators, and regulators to innovators, building capacity and knowledge on both sides.
The Government should standardise how strategic steers are issued and should be renewed at least every two years.

Ben Greenstone, Onward Policy Fellow, said: “Britain could unlock real, sustained growth if it harnessed the regulation of technologies right. But too often regulators are too slow, they overreach and they overcomplicate the landscape, making life a misery for innovators.

“Tinkering at the edges won’t cut it. Wholesale regulatory reform is needed if the Government wants to achieve its lofty growth ambitions.”