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February 3, 2023

‘An act of national self-harm’ – MPs criticise continuing delays to UK semiconductor strategy

The government is hiding behind 'poor excuses' in not accelerating progress on the long-awaited blueprint for the chip industry.

By Matthew Gooding

The UK government’s lack of action on delivering a national semiconductor strategy is an “act of national self-harm”, the chair of Parliament’s Business, Energy and Industrial Strategy (BEIS) Committee has said. Darren Jones was speaking after the government’s response to the committee’s report into the chip industry in the UK was published this morning.

When will the UK semiconductor strategy be published? (Photo by Gennady Danilkin/Shutterstock)

MPs on the BEIS committee delivered their report on the state of the UK semiconductor industry in November, stating that it had been “overlooked” by the government and urging Whitehall to publish a strategy for the sector as a matter of urgency.

The strategy has been more than two years in the making, and has yet to materialise, though a spokesperson for the Department for Digital, Culture, Media and Sport (DCMS) told Tech Monitor in November that it would be published “as soon as possible”.

UK semiconductor strategy: government’s ‘poor excuses’

In its response to the committee’s recommendations, published today, DCMS reiterated that the strategy will be made public in the near the future, without putting a specific timeline on when it would be published.

“We are aiming to publish the forthcoming UK semiconductor strategy as soon as possible,” it says. “The strategy has been developed in close collaboration with industry and international partners. DCMS intends for its publication to be the starting point for clear and continued cooperation between the government and industry in the sector, as we
look to address systemic challenges and unlock new opportunities over the next 20 years.”

The statement added that it will respond to the committee’s recommendations in full once the strategy is released, something which Jones described as a “poor excuse” for not addressing the concerns of MPs.

“It’s a poor excuse for the government to hide behind its failure to publish a semiconductor strategy for not responding to our practical recommendations fully,” Jones said.

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“Countries across the globe have grasped the importance of securing semiconductor supply chains for their futures, why haven’t we? While others race ahead, ploughing billions into setting up fabs or industry support, we’re not even at the starting line.

“Two-years in the making but still no strategy. Further delay would be an act of national self-harm. With 40 days until the budget, the strategy must be published urgently so that sufficient funds can be put behind it and used effectively.”

DCMS also declined to update the committee on any progress in securing the future of Newport Wafer Fab, the UK’s largest semiconductor plant. It was purchased by Chinese-owned Nexperia in 2021, but last year business minister Grant Shapps issued an order to unwind the deal on national security grounds, meaning the factory is looking for a new owner.

Nexperia is appealing the decision, and the DCMS statement said: “The government does not routinely comment on individual acquisitions. As the company Nexperia has publicly indicated that it may launch judicial review proceedings against the government on this decision, we cannot provide any further update until this has been completed, to avoid impacting the results of this review, or the commercial process.”

A spokesperson for DCMS said: “We are committed to supporting the UK’s vitally important semiconductor industry. Our strategy will address the recommendations identified by the committee, including opportunities to grow the sector further and make sure we have a resilient supply chain. The strategy will be published as soon as possible.”

The UK semiconductor industry awaits strategy publication

Leading industry figures are awaiting publication of the UK semiconductor strategy with interest.

Scott White, CEO of UK-based chipmaker Pragmatic Semiconductor, said: “The semiconductor industry is suffering from a tsunami of change and if the UK is ever going to achieve the ambition of becoming a global science and tech superpower, we need to act now.”

“The fact is that the UK has no realistic prospect of competing against the US, Taiwan, or the EU in advanced silicon semiconductors. Instead, the government needs to focus on supporting home-grown revenue opportunities in semiconductor sectors where the UK can build on existing differentiation and grow sustainably in the long term.”

White added that the imminent publication of the strategy is welcome news, but said that, alongside the blueprint for the future, the government needs to “show its commitment to the UK companies in this sector through significant public sector procurement and incentives for capital expenditure to level the international playing field”. He added: “This would enable UK businesses as well as public organisations like the NHS to reap the benefits of the technology already on offer here in Britain.”

Read more: Newport Wafer Fab episode shows UK government’s lack of support for semiconductors

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