This is the first article in a five-piece series on how the Conservatives must seize the opportunities presented by new technologies transforming our economy and society. This article was first published on 23 October and can be found here.
When Gutenberg invented the printing press in 1439 he eliminated an entire industry dedicated to hand-copying information. This generated rising demand for books that the previous labour-intensive means of production could never meet.
This technology-driven spread of information accelerated the emergence of a nascent middle class and transformed Europe’s political, economic and social order in the centuries ahead. It contributed to the Renaissance, the Age of Enlightenment – and eventually the First Industrial Revolution. In Britain, this was characterised by water and steam power mechanising production, as new railways, canals and inventions such as Hargreaves’ spinning jenny and Stephenson’s’ Rocket improved trade and transport.
Electricity, enabling even greater automation through mass production, would herald a Second Industrial Revolution from the late 1800s, whilst electronics and the birth of digital communication and the internet from the 1970s launched a Third Industrial Revolution.
While it took centuries for Gutenberg’s invention to break the information monopoly of an ecclesiastical and noble elite opposed to innovation – and decades for the Second and Third Industrial Revolutions to take hold – the scale of change delivered by a new Fourth Industrial Revolution (4IR) is lightning fast.
Characterised by the unprecedented fusion of technologies that blur the traditional boundaries between the physical, digital and biological spheres, breakthroughs – and new products – in fields such as artificial intelligence (AI), robotics, the Internet of Things, driverless cars, drones, 3D printing and nanotechnology are already transforming our economy and society.
Professor Klaus Schwab, Chairman of the World Economic Forum, is leading work at a global level to ensure policymakers are prepared for the dramatic changes the 4IR will bring. When I welcomed him to speak in Parliament last week, Schwab made it clear that this is neither a niche policy area nor a challenge for the future.
Put simply, the Fourth Industrial Revolution is already happening, and it is a political imperative for us Conservatives. It will be the defining political and economic issue of the next ten years, just as the financial crisis shaped the last decade. The 4IR is the field on which we must fight the next great battle over the value of free markets, just as a resurgent Left tries to re-open the debate on capitalism.
Conservatives win elections when we present a positive vision for the future and are seen as the best stewards of the economy. The “long-term economic plan” was an effective message because it told the electorate we had our eyes on the bigger picture, not just the here and now. Helping Britain lead the 4IR – and winning the political narrative around its benefits – presents us with similar election-winning opportunities, which we must seize as a party.
The statistics around the 4IR alone are dramatic: whilst AI could add an additional £630 billion to the UK economy by 2035, PwC has estimated that up to 30 per cent of jobs could be at risk from automation in a similar period. The Bank of England has warned that 15 million jobs are vulnerable. We need to face up to the fact that the 4IR’s enormous economic benefits also mean significant restructuring of the employment market. How we respond to this dilemma will help determine the future of both Britain and the Conservative Party. What’s clear is we cannot let Labour steal a march on us.
Jeremy Corbyn and John McDonnell are already using automation as an electoral weapon, mobilising their supporters against a dystopia they have created in which robots take workers’ jobs. Their Luddite, trade union-focused agenda involves “managing” new technologies, taxing innovation, and heavy regulation that attempts to put the future on hold. This would do untold damage to our economy and cause Britain to lose out on a massive opportunity to boost productivity and trade. Banning Uber in London is just a foretaste of a future Labour government’s approach to the 4IR.
In response, Conservatives must advocate for a free-market, pro-innovation vision for the 4IR that emphasises its benefits: new jobs in new industries like 3D printing; greater productivity through automation, AI and data-driven supply chains; and more exports as we sell our innovations to the world. Precision medicines will help us live longer, healthier lives. New energy technologies and a more efficient national grid will lower household energy bills. Driverless cars will make roads safer and reduce congestion. Innovation will raise living standards. Only by articulating a positive Conservative vision that seizes the initiative and sets the agenda on the 4IR can we retain our reputation for economic competence in future elections.
Moreover, we must put the 4IR centre-stage in our long-term political thinking about the economy. That’s why, in the last twelve months, I’ve led the first ever House of Commons debate on the 4IR, published a Free Enterprise Group report on how Britain can lead the 4IR, and founded the APPG on the Fourth Industrial Revolution to kick-start the discussion in Westminster. But there is more to do.
Unfortunately, the 4IR is often viewed as a niche policy area – and this must change. We need not fear the 4IR – because we can rise with it. If we get our economic policies right, we can be masters of this revolution, ensuring it consists not of changes that happen to us, but which work for us all. These policies include:
- Launching a new 4IR Emerging Technologies Investment Fund to help our entrepreneurs develop and commercialise new inventions, using funds already allocated by the Treasury and BEIS;
- Introducing a new British Innovation Principle into UK law to counter-balance the effects of the EU’s Precautionary Principle which can hold back innovation;
- Ensuring Britain spends three pre cent of GDP on R&D by 2030 to match our international competitors;
- Establishing a new National Institute for Artificial Intelligence and Robotics, to focus the efforts of entrepreneurs, industry, academia and government on two key 4IR technologies;
- Reviewing our education and training systems so they prepare our workers for the 4IR; and
- Reforming and funding our LEPs to help our regions and nations adapt to the 4IR.
In this week’s ConservativeHome series I will set out how and why Britain can – and must – lead the Fourth Industrial Revolution by implementing a Conservative vision. Achieving this goal will not be easy, and it will require significant effort from the private sector – this is not something Government can do alone.
However, there is a clear role for political leadership, and if we fail to lay the foundations on which Britain can make a success of the 4IR, we will have ignored one of the Conservative Party’s enduring missions: competent stewardship of our economy that gets our country to the future first.