The review of R&D reliefs comes as the Chancellor set out more detail about the government’s industrial strategy at the Autumn Statement.

The first major sign of a move away from the previous government under the leadership of David Cameron, is the setting up of a National Productivity Investment Fund to drive productivity and innovation in housing, transport, digital communications, and research and development (R&D) with £11bn set aside for projects within the current parliament

To help boost UK productivity, the NPIF will provide an additional £4.7bn by 2020-21 for specific research and development (R&D) funding. The extra £2bn a year by the end of this parliament is an increase of around 20% to total government R&D spending.

R&D tax relief review

At the same, the government confirmed that there will be a full review of the tax environment for R&D ‘to ensure the UK tax system is strongly pro-innovation’, according to the Green Book documentation released on the day of the Autumn Statement.

The government plans to look at ways to build on the introduction of the ‘above the line’ R&D tax credit to attract more inward investment into the UK.

A budget of £450m has been set aside for investment in digital communications for fibre and 5G broadband and mobile phone services, particularly targeting areas of the country with poor broadband and mobile coverage. Beyond the current parliament, a further £290m has been set aside for this sector.

It has also earmarked £140m for transport improvements in the Cambridge-Milton Keynes-Oxford corridor, with nearly £1.5bn of spending on roads and local transport nationwide.

Up until 2019/20, the government has set aside a £2.7bn cash injection into the National Productivity Investment Fund for research and development, which is set to rise to £2bn in 2020-21.

Long-term investment slated for expenditure after a May 2020 election, no less, has been allocated £7bn.

There is also a raft of investment across the devolved nations with Scotland set to receive around £800m, Wales £400m and £250m for capital budget of the Northern Ireland Executive. These figures run through to the post election 2020-21 period.