What the 2019 UK general election results mean for tech and IR35

The Conservatives marched to a landslide victory in the 2019 UK general election with an 86-seat majority.

Labour, meanwhile, endured their worst defeat since 1935, with the party winning just 203 seats with one seat left to be contested, and Liberal Democrats leader Jo Swinson lost her Dunbartonshire East seat to the SNP.

The SNP won 48% of the seats in Scotland, meaning an 8.1% increase on the 2017 election for Nicola Sturgeon’s party.

But the question remains: What will the election results mean for the tech sector in the UK?

A sooner review of IR35 is needed

One part of UK tech that needed to be addressed is the sector’s independent contractors. Set for reform to include the private sector in April 2020, the IR35 legislation refers to tax for contractors working for companies without the official status of employee.

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The CEO of contractor insurance firm Qdos, Seb Maley, has urged the Conservatives to review IR35 sooner.

“The likelihood is, many freelancers and contractors will have voted Conservative based on the party’s IR35 promise,” he said. “The Government now has a responsibility to honour its pledge to hold a genuine review of reform.

“Boris Johnson must act now. A review of IR35 reform has to take place before April’s roll-out. If this timeframe is unrealistic, then changes need to be delayed or, better still, halted altogether.

“While a review is a sign of progress, it doesn’t mean the changes will be scrapped. Therefore, contractors, recruitment agencies and end-clients must continue their preparations.”

In the tech sector, the amount of IT contractors dropped by 2.4% following the last IR35 reform in 2017.

A need for collaboration and preservation

Stan Boland, CEO of FiveAI, has called for the government to act on promises to support international collaboration when it comes to skills, recruitment and research.

“To build a successful global tech firm, you need smart, creative people and you need capital,” he said. “The UK has flourished as Europe’s biggest tech hub because it has both, along with world-class universities, top talent, and one of the world’s most supportive tax and regulatory environments.

“It’s vital that the Conservative government preserves what’s good about the UK tech sector, and helps to make it great.

“We encourage our political leaders to support an open and well-funded sector that can foster the iconic global tech companies of the future.”

Digital infrastructure must be highly prioritised

As we go into 2020, there will be a need for the UK to get the best out of digitisation capabilities.

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Mikael Sandberg, chairman of VXFIBER, said: “For digitisation to really see a strong impact, we’ll need to prioritise digital infrastructure, and full-fibre in particular.

“With Boris Johnson earlier this year highlighting his focus on increasing investment in digital infrastructure, we expect the new Conservative Government to stimulate the rapid deployment of full-fibre, not only in the UK’s major cities, but also for the benefit of rural communities.

“There’s no doubt that we’re entering a new political era, so we should see today’s result as a unique chance to get Britain connected and competitive for the future of the country.”

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Aaron Hurst

Aaron Hurst is Information Age's senior reporter, providing news and features around the hottest trends across the tech industry.