U.K. Chancellor of the Exchequer Philip Hammond will use Wednesday’s budget to allocate more than 550 million pounds ($674 million) to boost innovation and technology, as he focuses on targeted measures while keeping back the Treasury’s firepower to offset any turbulence from Brexit. 

The money, from the National Productivity Fund, will support work in areas including electric vehicles, robotics and artificial intelligence, the Treasury said in a briefing note. Hammond will also set out details on work to boost 5G mobile phone coverage in Britain.

The plan comes as Hammond pledged on Sunday to set aside money to cushion the economy as Britain prepares to start negotiations to exit the European Union. He warned the budget would not include any spending commitments funded by borrowing as he seeks to balance the books in the next parliamentary term.

Eoin Treacy's view

The UK needs a competitive advantage in how it navigates its post Brexit reality. The City, defence and the domestic oil business have all played a role in sustaining the UK’s independence in the past but some of the biggest questions posed by Brexit are whether these will be enough to sustain the economy in future. Streamlined common sense regulation and attractive tax policies are going to have to form part of the solution in order to delineate the UK from its neighbours. However intellectual property and the ability to leverage technological knowhow on a global scale are the hallmarks of successful enterprises and countries and will also be essential to plotting a success independent strategy of the UK. 

By committing £550 billion to technology, research and education the UK is taking a bold step to confirm its intention to be a centre of future innovation. The map contained in this article from the Daily Mail highlights how uneven access to high speed internet it and you will also notice that speeds top out at less than 50mbps. Both of these metrics are rather disheartening and highlight just how much work needs to be done in basic infrastructure as well as education and research. 

Liberty Global, owner of Virgin Media which is one of the UK’s largest broadband operators broke out of a yearlong range in January and has at least paused in the region of the trend mean. A sustained move below $33 would be required to question medium-term scope for additional upside.