There were some intriguing developments announced regarding the UK’s Brexit negotiations and the Digital Single Market strategy on Friday the 20th of January. I can’t imagine why we all missed it.
These developments came in a report published by the Business, Energy, and Industrial Strategy Committee of the House of Commons. The full report is fourteen pages in pdf, also available in one page of six-point type.
Keen readers will recall that the committee’s predecessor, the Business, Innovation and Skills Committee, published a comprehensive and surprisingly critical report on 18 July (the transition week between David Cameron and Theresa May) which took the government to task on the digital economy. That report made several recommendations and demanded clarification on important digital and tech issues.
The report released on 20 January contained the government’s response to the Committee’s recommendations made in July.
Without reading a word of it, that fact alone should give you a sense of what the government’s response looks like. It has taken them six months to answer simple questions and as you will see, the answers, for what they are, say very little. It’s as if “taking back control” was really about Theresa May’s well-publicised control freakery and not the wider economy. Who would have guessed that?
For this post I have picked out the usual points of interest.
Measuring the digital economy (miscounting)
The miscounting of the digital economy, and all those who work within it – a consequence of outdated economic taxonomies that have only been reviewed a handful of times since World War II – is the root cause of many of our industry’s political difficulties. You can read my previous rants on it here.
In July the committee said:
…[w]e recognise the difficulty of measuring the digital economy, but the Government should look to the work of the Office of National Statistics, and explore ways of collecting real-time data in the digital economy, and ensure that established Standard Industrial Classification (SIC) codes are agreed and used, in different parts of the digital economy.
The government replied:
The Government is also working with international colleagues to define the digital economy and to influence the standard industrial classifications (SICs) at an international level so that they reflect the changing nature of the economy in a way that works for the UK.
This is a typical May government non-answer. What international colleagues? What workings? What meetings? What sessions? Where are the working papers, the draft taxonomies, the calls for input? What does “in a way that works for the UK?” mean in the context of a system which is inherently international?
Nothing done without us is for us, yet the government here takes a parental tone that they know best.
The Government’s Digital Strategy
This pertains to the absurd saga of the government sneaking in a three-week consultation about the domestic digital strategy over Christmas break 2015 and then doing nothing with the results, conveniently blaming Brexit.
In July the committee asked:
We look forward to the publication of the Government’s Digital Strategy, in the summer of 2016 (six months later than expected), which should explain how the Government will build on its success. We regret this delay, and call on the Government to explain the reasons for it, and why they initiated a three-week consultation over the Christmas break on what the Government should include in the strategy.
The government’s January answer is so self-servingly evasive it is almost admirable.
We are already among the most digitally connected countries in the world with a globally successful digital economy. Following the decision of the British people to leave the European Union, we have been engaging closely with the digital industries to understand their priorities, and will continue to do so. At the Autumn Statement, the Chancellor underlined the Government’s continued support for innovation and technology with the announcement of an additional £2 billion of public spending on R&D a year by 2020–21 and a £1bn investment in digital infrastructure. We will continue to work with industry to ensure that our digital and industrial strategies help boost growth and productivity across the country and across the economy.
Yes, they completely ignored the original question.
Now it gets interesting. The committee had also asked:
The Government must also explain how the Digital Strategy will be affected by the referendum result. It should also set out in its reply and in the Digital Strategy a list of specific, current EU negotiations relating to the digital economy.
The government responded:
The decision taken by the British people to leave the European Union will clearly change our relationship with the EU, but it will not stop our progress toward a more digital economy. The decisions around priorities for the renegotiation will be taken by the Prime Minister in due course.
So there is your government digital strategy. Theresa May is the strategy. L’etat c’est moi.
The government response now comes to the list of the specific, current EU negotiations they claim to be involved in:
We are currently involved in the following EU negotiations related to the digital economy:
- Reforming the European Copyright Law package
- Electronic Communications Framework Review
- Services Package, as part of the Single Market Strategy, including the Services notification procedure
- General approach on geoblocking
- General approach on Consumer protection Co-operation
- Digital Single Market VAT (e)-package (VAT on e-commerce, e-publications, e-books) (HB note: VATMOSS)
- Free flow of data initiative (HB note: this means GDPR)
- Legislative Proposal on Services Passport
That is news to every one of us.
The government says they are involved in these negotiations but there is no transparency, there is no indication of who is doing the work, there is no detail available, there is no progress report, and the list itself had to be dragged out of the government by Parliament.
“Taking back control” and so forth.
Digital Single Market
In July the committee pulled no punches:
The decision to leave the European Union risks undermining the United Kingdom’s dominance in this policy area. We could have led on the Digital Single Market, but instead we will be having to follow. The Government must address this situation, to stop investor confidence further draining away, with firms relocating into other countries in Europe to take advantage of the Digital Single Market… the Government needs to address the issue of whether businesses will be able to access the European Single Digital Market, if they want to do so. In broader terms, we recommend that the Government sets out in its digital strategy the implications of withdrawal from the European Union, in reference to specific, current EU negotiations relating to the digital economy.
The government has responded:
While we remain a member of the EU we will continue to play a role and represent the interests of the British people. This includes taking an active part in and influencing negotiations regarding the Digital Single Market and ensuring that British views are heard in the debates. Government will need to consider all factors carefully in implementing the decision of the British people, but access to the single market will be one of the most important issues to address…
We will be considering all options to ensure that digital companies can make the most of our trading relationships with the rest of the world.
Did you catch what they did there? The government responded to the committee by repeating their question back to them in the way that made it look like an answer. Where the Digital Single Market is concerned, this tactic seems to be catching. Just look at what the Brexit white paper published last Thursday had to say about the DSM:
8.18 … The EU’s Digital Single Market measures are designed to ensure the regulatory environment keeps pace with the evolving digital economy.
Really: that was all it said about the DSM. The government did not say what we are doing with it. They repeated the definition of what it is and called it an answer.
We recognise that Britain is leaving the EU. We recognise that negotiations are complex and delicate. We recognise that these things take time.
We also recognise when the government is taking the piss.
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