British Government Torched Over Lack Of Chips Strategy

The UK government has come under further fire for dragging its feet on a national semiconductor strategy while other industrialized nations push ahead with investment in their own high-tech sectors.

A committee of MPs within the House of Commons has reiterated its call for a semiconductor strategy to be published urgently in order to safeguard the local tech industry, expressing disappointment with the government's response to its earlier report on the state of the industry.

The earlier report, "The semiconductor industry in the UK," was published at the end of November last year by MPs on the Business, Energy and Industrial Strategy Committee. As detailed by The Register at the time, it laid out how the UK industry has strengths in some areas but does not have a complete end-to-end supply chain and is vulnerable to any future disruption in global supplies. It contained key recommendations including better cooperation with allies to safeguard supplies and to secure inward investment.

The committee today indicated it was dismayed that its recommendations had not been fully addressed, and called for a full response to its report whenever an official strategy - due months ago - is finally published.

"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," said committee chair Darren Jones, who is Labour MP for Bristol North West.

Countries across the globe have grasped the importance of securing semiconductor supply chains for their futures, he said, yet "while others race ahead, ploughing billions into setting up fabs or industry support, we're not even at the starting line." Further delay would be an act of national self-harm, he added.

In its response to the earlier report in November, the government said it agreed fully on the importance of the semiconductor industry, and there was a need for "timely, coherent and decisive action to be taken across the market."

The government claimed it was already in initial talks with "like-minded nations on the future of the global semiconductor market," including the US, Japan, and Korea.

In order to ensure that the UK is able to contribute significantly to these international discussions, it said it was vital the country remains a key part of the global semiconductor value chain, and the government will need to capitalize on the UK's existing strengths in semiconductor chip design.

The government said it agrees on the importance of publishing a new UK semiconductor strategy that will set out a clear long-term vision for the UK, adding that, "This is why we are aiming to publish the forthcoming UK semiconductor strategy as soon as possible."

How soon that will be is difficult to tell. The semiconductor strategy was promised at least as far back as April last year, when Lord Callanan told the House of Commons the Department for Digital, Culture, Media and Sport was working on one "to be published shortly."

Meanwhile, in Japan, the country is pushing ahead with plans for its state-backed semiconductor venture Rapidus, which aims to partner with IBM on the development of cutting edge chip technology such as 2nm process nodes.

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Rapidus chairman Tetsuro Higashi told Reuters the company would likely need about 7 trillion yen ($54 billion) of investment in order to begin mass producing advanced chips by about 2027.

By comparison, this is more than the entire $52 billion budget of the US CHIPS Act funding, as well as the €43 billion ($44.8 billion) the EU aims to stump up to fund all of its European semiconductor projects.

In the UK, of course, we instead prefer to spend billions on buying government bonds in order to restore market stability following a disastrous mini budget, (although the real figure was apparently much less than the £65 billion ($78.8 billion) widely mentioned in the media).

The latest talk about UK chips comes just a week after a group of prominent technology industry advocates published an open letter to Prime Minister Rishi Sunak, imploring the premier to "prepare and publish a UK Semiconductor Strategy as a matter of urgency" as "Britain's status as a leading tech ecosystem is at risk." ®