In my pre-Budget commentary I made the point that Phillip Hammond was facing two major problems in deciding what measures to implement in his Autumn Budget; the looming threat of Brexit, and the need to deal with the deficit whilst also attempting to honour Theresa May’s proclamation that austerity was coming to an end – writes James Francis, Partner, Ensors Chartered Accountants.

I also made the point that the Chancellor might try to avoid these issues by essentially deferring them until after Brexit negotiations have been finalised, and the UK has actually left the EU. This appears to be precisely what he has done.

This was made clear most starkly in his comments the day before the Budget, that if there was a ‘no-deal’ Brexit, a new budget would be required. This effectively means that all of the measures the Chancellor announced on Monday are contingent on some form of deal being reached between the UK and the EU. 

Whilst some may view this as something of a ‘cop-out’, it seems to me that this is only sensible, as the UK leaving without a deal would have many immediate (and even more long term) implications that would have to be dealt with by the government. 

By flagging this up now Mr Hammond is giving himself room to manoeuvre, allowing him to make changes that would be needed in such a scenario in order to reassure and support the economy.

Much of the media reporting of the Budget has highlighted an apparent ‘spending spree’ by the Chancellor but this is only somewhat borne out by a closer reading of the facts. 

It is true that NHS funding has been increased, money has been announced for potholes, income tax thresholds have been raised and the Armed Forces budget has been expanded, amongst other things. 

However, many of these were measures that had already been announced (NHS funding), were bringing forward future commitments (income tax thresholds), or are being paid for out of funds already allocated (potholes). 

Nevertheless, it is fair to say that Mr Hammond has definitely spent more here than many predicted (including myself) and has moved towards to an ending of austerity and away from a balancing of the books. 

This is further reinforced by the fact that (not unexpectedly) relatively little was announced in terms of increasing tax revenues, the only significant item being the new digital services tax.

In terms of the economy generally the news was mixed. On the one hand the growth forecast for 2018 was decreased from 1.5 per cent to 1.3 per cent, a disappointing outcome apparently caused by poor weather in the spring. More positively the forecast for 2019 was increased from 1.3 per cent to 1.6 per cent and for 2020 from 1.3 per cent to 1.4 per cent. 

Despite these revised figures the UK continues to lag behind other major western economies such as Germany (1.9 per cent) and the USA (2.9 per cent), and there is little prospect of this changing in the near future, especially with the uncertainty surrounding Brexit.  

Overall, this was a relatively safe budget that was clearly designed to provide reassurance to stock markets and outside investors whilst introducing a few modest and popular measures that would take advantage of the unexpectedly lower public borrowing figures for 2018. 

The Chancellor, as with many people and businesses across the country, appears to be putting off any major decisions while he waits to see how Brexit finally plays out.   

ensors.co.uk

In my pre-Budget commentary I made the point that Phillip Hammond was facing two major problems in deciding what measures to implement in his Autumn Budget; the looming threat of Brexit, and the need to deal with the deficit whilst also attempting to honour Theresa May’s proclamation that austerity was coming to an end – writes James Francis, Partner, Ensors Chartered Accountants.

I also made the point that the Chancellor might try to avoid these issues by essentially deferring them until after Brexit negotiations have been finalised, and the UK has actually left the EU. This appears to be precisely what he has done.

This was made clear most starkly in his comments the day before the Budget, that if there was a ‘no-deal’ Brexit, a new budget would be required. This effectively means that all of the measures the Chancellor announced on Monday are contingent on some form of deal being reached between the UK and the EU. 

Whilst some may view this as something of a ‘cop-out’, it seems to me that this is only sensible, as the UK leaving without a deal would have many immediate (and even more long term) implications that would have to be dealt with by the government. 

By flagging this up now Mr Hammond is giving himself room to manoeuvre, allowing him to make changes that would be needed in such a scenario in order to reassure and support the economy.

Much of the media reporting of the Budget has highlighted an apparent ‘spending spree’ by the Chancellor but this is only somewhat borne out by a closer reading of the facts. 

It is true that NHS funding has been increased, money has been announced for potholes, income tax thresholds have been raised and the Armed Forces budget has been expanded, amongst other things. 

However, many of these were measures that had already been announced (NHS funding), were bringing forward future commitments (income tax thresholds), or are being paid for out of funds already allocated (potholes). 

Nevertheless, it is fair to say that Mr Hammond has definitely spent more here than many predicted (including myself) and has moved towards to an ending of austerity and away from a balancing of the books. 

This is further reinforced by the fact that (not unexpectedly) relatively little was announced in terms of increasing tax revenues, the only significant item being the new digital services tax.

In terms of the economy generally the news was mixed. On the one hand the growth forecast for 2018 was decreased from 1.5 per cent to 1.3 per cent, a disappointing outcome apparently caused by poor weather in the spring. More positively the forecast for 2019 was increased from 1.3 per cent to 1.6 per cent and for 2020 from 1.3 per cent to 1.4 per cent. 

Despite these revised figures the UK continues to lag behind other major western economies such as Germany (1.9 per cent) and the USA (2.9 per cent), and there is little prospect of this changing in the near future, especially with the uncertainty surrounding Brexit.  

Overall, this was a relatively safe budget that was clearly designed to provide reassurance to stock markets and outside investors whilst introducing a few modest and popular measures that would take advantage of the unexpectedly lower public borrowing figures for 2018. 

The Chancellor, as with many people and businesses across the country, appears to be putting off any major decisions while he waits to see how Brexit finally plays out.   

ensors.co.uk

The Chancellor, possibly buoyed by an unexpected improvement in the public finances, delivered a Budget that was broadly favourable to business – writes Tim Shaw, Associate partner, Ensors Chartered Accountants. 

The principal changes announced are as follows.

To considerable relief, entrepreneur’s relief has been retained though there has been a doubling in the qualifying period of ownership to two years with effect from 6 April 2019. 

The definition of a “personal company” has been tightened and shareholders must now, in addition to the existing requirements (5 per cent interest in the ordinary share capital and voting rights), have both a 5 per cent interest in the distributable profits and net assets of the company for the relief to be available.

As feared, the off-payroll working rules are to be extended to the private sector, albeit not until 6 April 2020. The changes, which potentially impose a payroll reporting obligation, along with an employer’s NIC cost, when payments are made to contractor’s companies, will only be introduced for large or medium sized businesses, though no definition of these is yet available. This change potentially imposes significant compliance burdens and costs on business.

Unexpectedly, a substantial increase in the annual investment allowance to £1,000,000 per annum from 1 January 2019 to 31 December 2020 was announced. 

As a result, businesses will be able to spend up to this amount per annum during this period on qualifying fixed assets and obtain a full tax deduction in the year of acquisition. 

This change is partly offset by a reduction in the writing down allowance for special rate pool items to six per cent per annum and the abolition by April 2020 of 100 per cent first year allowances for energy/water saving plant and machinery.

I will not complain about a couple of welcome changes, even if they both have a sense of déjà vu. Capital allowances are to be made available on new non-residential structures and buildings at two per cent per annum.

This brings back memories of the industrial buildings allowance legislation which was withdrawn less than a decade ago on the grounds that it was no longer relevant.

In addition, targeted relief will be available from April 2019 in respect of goodwill forming part of business acquisitions. This is a little unexpected as tax relief for purchased goodwill was broadly abolished in 2015!

The Chancellor’s desire to impose a digital services tax was clear pre-Budget. This tax is now being introduced from April 2020 and will apply to digital service providers with more than £500 million in global revenues. The tax will be charged at two per cent of revenues from UK customers with the first £25 million of UK revenues not being taxed.

The US Chamber of Commerce has already criticised the new UK tax and it remains to be seen whether this could spark any US retaliatory measures.

An amendment has been made to the R & D tax credit scheme for SMEs from April 2020 so that cash repayments will be capped at three times that company’s total PAYE and NICs liability for that year. This could impact adversely on smaller companies who rely on subcontractors, in lieu of employees, for their R & D efforts.  

For companies, rules will be introduced from April 2020 to tighten the use of capital losses brought forward and align this with the existing corporation tax rules for income losses. The restriction will limit the use of brought forward capital losses to 50 per cent of chargeable gains over and above £5m.

Despite my previous fears, no changes were made to the annual dividend allowance and the introduction of making tax digital for VAT registered businesses has not been revoked!

ensors.co.uk

Tomorrow marks the fourth birthday of Amazon’s Alexa – IP born in Cambridge via the fertile brain of True Knowledge and Evi Technologies founder William Tunstall-Pedoe.

The entrepreneur sold voice recognition company Evi to Amazon in 2012 for around $26 million and, baby, look at the technology now!

As has been widely reported after three years at Amazon, Tunstall-Pedoe left to pursue other AI projects but the US giant continued to use the core IP to sculpt what would become Alexa and its band of assorted brothers and sisters in the voice controlled device word.

Its success was one of the reasons why competitor Apple, also now growing in Cambridge, paid the thick end of $100m for another tech tyro in this cluster – VocalIQ, whose founders Professor Steve Young and Blaise Thompson now work for Apple to further develop the Siri family.

Strategy thought leader Accenture, which also has Cambridge operations – at Milton Hall – keeps a well manicured finger on the pulse of a great many technologies and has marked Alexa’s anniversary with some timely research on the voice controlled device market.

Its observations show that there is massive headroom for global growth in the sector – which may explain the size and timings of Amazon’s and Apple’s acquisitions in Cambridge.

Accenture tells Business Weekly that the impact of voice-controlled devices is only growing “as they pop-up in more and more of our homes.” And as it points it, birthdays may be a time for reflection but they also offer the opportunity to look at what the future holds for voice assistants generally.

Recent Accenture research found that, despite increasing adoption of the technology, there are still significant barriers.

More than a quarter of respondents quizzed said they shied away from using their device to make payments; well over a quarter worried about transferring money and using it to pay bills. This reluctance, for more than half of people stemmed from concerns about security or a fear of being hacked and having their personal details stolen.

Then there is the ‘spy in the room’ factor: More than one in five admitted to leaving the room or lowering their voice to make sure their device couldn’t spy on them! Nearly half believed the technology was always listening – even when they’ve not been given a command.

Accenture said: “While voice assistants mean sophisticated functionality is just a simple command away, most people use theirs for only basic tasks. 

“On average, users are speaking to their voice assistant four times a day – more often than they speak to their family – but they are still most likely to use it to answer a random question or find out a fact (54 per cent), followed by checking the weather forecast (50 per cent) and listening to music (45 per cent).

“More than one in five admit they don’t use their voice assistant more because they don’t trust it. The average user is taking advantage of only six of their device’s skills, which is barely the tip of the iceberg when some devices have over 45,000 to choose from.”

Emma Kendrew, Artificial Intelligence lead for Accenture, adds: “The take-up for voice assistants has been big – especially when you consider they’re a very new technology. 

“However, many people are not using them to their full potential because of trust issues. There are a lot of misconceptions out there about how these voice assistants work.”

All of which will no doubt be music to the ears of Amazon and Apple and others on the voice assistant market A-list as they realise the potential for a massive suture spike in revenues.

Remember where you heard it first – and in this case it wasn’t your voice assistant!

Cambridge drug developer Crescendo Biologics has won a lucrative payment from Japanese pharma giant Takeda as part of a partnership potentially worth $754m.

Business Weekly understands the decision by Takeda to exercise an option under the  existing, multi-target collaboration and licensing agreement is worth several million dollars to the UK innovator. The partners decline to issue any figures.

Crescendo, which is based at Babraham Research Campus, is developing novel, targeted T-cell enhancing therapeutics. Takeda has taken an exclusive licence to Humabodies directed to one of its oncology targets.

The licence option exercise comes substantially earlier than planned and marks the highly successful delivery and further pre-clinical evaluation by Takeda of Humabody® leads meeting its stringent criteria. 

Crescendo CEO Dr Peter Pack said: “The team at Crescendo has made great progress on our Humabody programmes, working closely with the Takeda team. 

“To date, we have met all the technical milestones on time or earlier than planned, which is proof of our excellent collaboration. We are delighted that the option to license has been taken by Takeda ahead of schedule and look forward to further future successes.”

Chris Arendt, Head, Oncology Drug Discovery Unit & Immunology Unit, Takeda, added: “At Takeda, we continue to research diverse modalities to bring transformative treatments to patients with cancer.

“Our decision to exercise the licence was based on the quality of the Humabody leads and the potential we see to develop improved and differentiated immuno-oncology therapies.”

The existing multi-target collaboration and licence agreement was announced in October 2016. Takeda received the right to develop and commercialise Humabody®-based therapeutics resulting from the collaboration. 

Crescendo is eligible to receive clinical development, regulatory and sales-based milestone payments of up to $754 million plus royalties on Humabody®-based product sales by Takeda.

• PHOTOGRAPH SHOWS: Crescendo CEO Dr Peter Pack

This was supposed to be a fund-raising Budget with tax increases to pay for the NHS and Universal Credit and so on. Instead, there were lots of give-aways, admittedly mostly small amounts, but nevertheless adding up to £103 billion over six years – writes Nick Edgley – Tax Manager, Ensors Chartered Accountants.

The big headlines focus on the increased personal allowance and higher 40 per cent tax threshold. However, there are a few other announcements which may have slipped past unnoticed and which could have an unexpected impact.

It is well known that any profit arising on the sale of a main residence is usually exempt from CGT. Sometimes, the sale of one residence is delayed, so people will end up owning more than one house at once (and probably having an expensive bridging loan at the same time).

It is only possible to have one main residence at any point, so if there is an overlap in ownership, there is a potential for CGT to be incurred. 

To ensure that where two residences were owned at the same time due to a delay in selling, in earlier years the final 36 months of ownership of the second residence was ignored, but this period was reduced to 18 months in April 2014 and is now due to go down even further to nine months from April 2020.  

The Treasury says that this is twice the length of an average property transaction, but with a slowing property market this nine-month ‘breathing space’ might be too short for many.

Also, there is a little known additional allowance which can reduce capital gains by up to £40,000 per owner, where they sell a property which has been at some time their main residence, but which has also been let out to tenants. 

This relief is now being restricted to cover only those periods where the property was being lived in by the owner and the tenant together, although we do not yet have any detail of the exact requirements. Again, this will apply from April 2020 onwards.

With the other restrictions for tax relief which now apply to landlords, such as the gradual removal of higher rate tax relief on mortgage interest and higher stamp duty charges, some landlords might think quite carefully about whether they really want to hold on to residential property.  

Indeed, the helpful advice provided in the Budget documents says that the time between now and April 2020 “will give people sufficient time to re-arrange their affairs (i.e. by selling their property) under the current rules should they wish to do so”. 

ensors.co.uk

Sientists at the Wellcome Sanger Institute in Cambridge recently announced that they had created the first comprehensive summary of all genes known to be involved in human cancer, the ‘Cancer Gene Census’.

Now The Sanger Institute has started work on unlocking the genetic codes of 66,000 UK species as part of a global initiative to sequence the genomes of all 1.5 million known species of animals, plants, protozoa and fungi on Earth.

Efforts by Sanger on the The Darwin Tree of Life Project are part of a wider play in the global Earth BioGenome Project (EBP). Officially launched yesterday, the Earth BioGenome Project saw key scientific partners and funders from around the world gather to discuss progress in organising and funding the project. The EBP will ultimately create a new foundation for biology to drive solutions for preserving biodiversity and sustaining human societies. 

The Sanger Institute was founded in 1993 by Professor Sir John Sulston as part of the Human Genome Project. The Institute made the largest single contribution to the gold-standard sequence of the first human genome, which was published in 2003. Of the 23 human pairs of chromosomes, eight were sequenced by researchers at the Sanger Institute in Cambridge and their collaborators.

A genome is an organism’s complete set of genetic instructions written in DNA. Each genome contains all of the information needed to build that organism and allow it to grow and develop.

Since the landmark completion of the human genome, the Sanger Institute has become a globally recognised leader in the field of genomics. 

Numerous important reference genomes have already been sequenced – from the mouse and zebrafish genomes to the pig, gorilla, mosquito among others. Beyond animal species, infectious diseases and bacteria also feature prominently on the list of reference genomes, from salmonella and MRSA to chlamydia and malaria. All of these have offered up important insights about these species in health and disease.

Cancer

Describing all genes strongly implicated in the causes of cancer, the Cancer Gene Census explains how they function across all forms of this disease. 
Reported in Nature Reviews Cancer, the resource catalogues over 700 genes to help scientists understand the causes of cancers, find drug targets and design treatments.

The study characterises the increasing understanding that many genes have multiple different roles in different cancers. This paves the way for improvements in personalised medicine, and building combinations of anti-cancer drugs for any given set of genetic functions or mutations.

To address this, researchers working with the Catalogue of Somatic Mutations in Cancer (COSMIC) have created the Cancer Gene Census. While the COSMIC database characterises over 1,500 different forms of human cancer and types of mutations, the Cancer Gene Census describes which genes are fundamentally involved and describes how these genes cause disease.

For the first time in history, functional changes to these genes are summarised in terms of the 10 cancer hallmarks – biological processes that drive cancer. Mutations in some genes lead to errors in repairing DNA, whereas mutations in other genes can suppress the immune system or promote tumour invasion or spreading. 

Across the 700 genes in the Cancer Gene Census, many have two or more different ways of causing cancer. These are often different and sometimes contradictory depending on the tumour type, and are all described in this single resource.

The scientists have manually condensed almost 2,000 papers to draw together strong evidence of a gene’s role in cancer and describe which genetic functions go wrong to cause cancer. This knowledge is crucial to developing new therapeutics. 

When combined with the COSMIC database, it is now possible to characterise exactly which cancers are impacted by which genes and which mutations are likely involved.

Cancer is a genetic disease, and mutations in DNA can affect cells so that they are able to grow uncontrollably. Cancer can form in over 200 parts of the body and hundreds of different genes are known to be involved. 
To understand individual cancers and design specific treatments, many complex details need to be combined. However, this information is often spread out across thousands of different scientific publications and public databases.

Dr Zbyslaw Sondka, the lead author on the project from the Wellcome Sanger Institute, said: “Scientific literature is very compartmentalised. With the Cancer Gene Census, we’re breaking down all those compartments and putting everything together to reveal the full complexity of cancer genetics. 
“This is the broadest and most detailed review of human cancer genes and their functions ever created and will be continually updated and expanded to keep it at the forefront of cancer genetics research.”

The Tree of Life

The Darwin Tree of Life project is expected to cost £100 million in the initial first five years, and the sequencing of 66,000 species’ genomes will take around 10 years.

The project has been made possible due to recent advances in sequencing and information technology that will enable the reading and interpretation of thousands of species’ genomes each year by the Sanger Institute and its partner institutions across the UK and internationally. 

The data will be stored in public domain databases and will be made freely available for research use. 

To mark the 25th anniversary of the Wellcome Sanger Institute, the institute and its collaborators used PacBio® long-read technology and protocols developed by the VGP to sequence the genomes of 25 UK species for the first time*, including red and grey squirrels, the European robin, Fen raft spider and blackberry. 

The insights gained from the 25 Genomes Project form a basis for scaling up to sequence the genomes of 66,000 species.

Professor Sir Mike Stratton, Director of the Wellcome Sanger Institute, said: “Globally, more than half of the vertebrate population has been lost in the past 40 years, and 23,000 species face the threat of extinction in the near future. 

“Using the biological insights we will get from the genomes of all eukaryotic species, we can look to our responsibilities as custodians of life on this planet, tending life on Earth in a more informed manner using those genomes, at a time when nature is under considerable pressure, not least from us.”  

Sir Jim Smith, Director of Science at Wellcome, said: “When the Human Genome Project began 25 years ago, we could not imagine how the DNA sequence produced back then would transform research into human health and disease today. 

“Embarking on a mission to sequence all life on Earth is no different. From nature we shall gain insights into how to develop new treatments for infectious diseases, identify drugs to slow ageing, generate new approaches to feeding the world or create new bio materials.”.

The Sanger Institute will serve as the genomics hub in the UK and will collaborate with the Natural History Museum in London, Royal Botanic Gardens, Kew, Earlham Institute, Edinburgh Genomics, University of Edinburgh, EMBL-EBI and others in sample collection, DNA sequencing, assembling and annotating genomes and storing the data. 

Sanger will also work with with other groups contributing to the EBP, such as the G10K Vertebrate Genomes Project (VGP) and the 10,000 Genomes Plant Project, to ensure there is no redundancy of effort, and that each project contributes to the other.

Sequencing the eukaryotic species in the UK and worldwide will revolutionise our understanding of biology and evolution, bolster efforts to conserve, help protect and restore biodiversity, and in return create new benefits for society and human welfare.  

Professor Harris Lewin, University of California, Davis, United States and Chair of the Earth BioGenome Project, said: “The Darwin Tree of Life Project is a tremendously important advance for the Earth BioGenome Project and will serve as a model for other parallel national efforts. 

“The Wellcome Sanger Institute brings decades of experience in genome sequencing and biology to help build the global capacity necessary to produce high quality genomes at scale. The Earth BioGenome Project and its partner organisations welcome the outstanding leadership that the Wellcome Sanger Institute brings to our efforts to sequence all known eukaryotic life on our planet.”

The estimated cost of the The Earth BioGenome Project (EBP)  is $4.7 billion. Accounting for inflation, the Human Genome Project today would cost $5 billion.

Funding

The Wellcome Sanger Institute will use core funding from The Wellcome Trust to introduce a research programme in Tree of Life genomics. Further funding support for sample collection, sequencing machines, data infrastructure is required.

Activities of the EBP are currently being funded by the participating organisations as well as private foundations, governmental organisations and crowd-funding sources. 

Significant funds have been raised by taxon-based communities, national and regional projects to meet the $600 million goal necessary to complete Phase 1 of the project, which aims to produce approximately 9000 reference quality genomes across all taxonomic families.

Cambridge UK gene editing world leader Horizon Discovery has emerged as the power behind the throne of a significant new cancer test unveiled by quoted Belgian business Biocartis in Texas today.

Horizon has partnered with Biocartis to provide reference standards for the client’s recently launched Idylla™ microsatellite instability assay. It is the first commercially available reference standard for microsatellite instability (MSI) testing.

Horizon Discovery’s reference material covers seven new MSI markers tested for on the Idylla™ platform; MSI is a form of genetic instability predominantly found in colorectal, gastric and endometrial cancer and serves as a prognostic, diagnostic and predictive marker in the clinic.

Biocartis paraded the full power of the technology with the publication of eight Idylla™ performance study abstracts at the Association for Molecular Pathology (‘AMP’) conference in San Antonio, starting today.

Scene of The Alamo, San Antonio is battle hardened and no fight is surely more decisive than the intensifying war against killer cancers.

Biocarta’s studies are being performed by renowned US oncology key opinion leaders from the Memorial Sloan Kettering Cancer Center (New York), Dartmouth–Hitchcock Medical Center (New Hampshire), Cambridge’s own AstraZeneca and the University of Alabama. 

All abstracts again highlight excellent Idylla™ performance, showing high concordance with current testing methods in combination with the unique features of the Idylla™ platform, being its ease of use, fully automated workflow and short turnaround times.

Horizon Discovery developed a set of precisely defined cell line-derived reference standards to support the Idylla™ MSI assay.

The Idylla™ MSI Assay (RUO) allows for qualitative detection of a novel panel of seven monomorphic homopolymer biomarkers to identify human cancers with microsatellite instability (MSI), in a fully automated manner. 

The assay uses formalin-fixed, paraffin-embedded (FFPE) tissue sections from human cancer tissue, from which nucleic acids are extracted, amplified and then analysed. Horizon’s newly developed MSI FFPE reference standards enable validation and routine monitoring of MSI testing on the Idylla™ platform.

Dr Chris Lowe, head of Research Operations, Horizon Discovery, said: “Horizon pioneered the development of genetically defined, well-characterised cell line derived reference standards, and this collaboration with Biocartis further validates our position as the leader in the field. 

“Our teams are continually innovating to expand this range and we are proud to offer a sustainable source of reference material to support accurate assay results when examining MSI on the Idylla™ platform.”

Erwin Sablon, VP Alliance Management & Partnerships of Biocartis, added: “The collaboration between Biocartis and Horizon has contributed greatly to the successful market launch of the Idylla™ MSI Assay in July. We continue to be impressed with the quality of Horizon’s reference standards.”

Microsoft and Cambridge University have joined forces in a multimillion pound initiative to address the problem of ‘brain drain’ in AI and machine learning research.

As part of the Microsoft Research-Cambridge University Machine Learning Initiative, Microsoft will help increase AI and machine learning research capacity and capability at Cambridge by supporting visiting researchers, postdoctoral researchers, PhD students and interns from the UK, EU and beyond.

The new Initiative builds on more than two decades of collaboration between the University and Microsoft Research Cambridge and will be based in the University’s Department of Engineering. It will be formally announced today at the Microsoft Future Decoded Conference in London.

AI and machine learning have the potential to revolutionise how we interact with the world, but before these technologies can be widespread and used in industries such as healthcare, education and transportation, there are complex problems that need to be solved.

A shortage of skills in AI and machine-learning, particularly at PhD level and above, has led to many large tech companies recruiting from academia, leaving behind a shortage in research and teaching capacity at universities.

“By focusing on a two-way collaborative initiative for long-term growth, not short-term gain, we are taking a different approach to this problem. We are working with universities to build up AI and machine learning talent and research in the UK,” said Chris Bishop, Lab Director, Microsoft Research Cambridge.

“Our researchers regularly work together on projects with global impact, and this initiative will help to build on the already strong links between the University of Cambridge and Microsoft.”

Professor Andy Neely, Pro-Vice-Chancellor for Enterprise and Business Relations at Cambridge, added: “Cambridge has a culture of ideas going back and forth between industry and academia, and this agreement with Microsoft is a prime example.

“By working together with industry on issues such as how best to use AI and machine learning, we can not only help solve complex issues for industry, but continue to support world-leading research and train the next generation of leaders in the field.”

Earlier this year the Government and the AI sector agreed a Sector Deal to further boost the UK’s global reputation as a leader in developing AI technologies, ensuring the UK remains a go-to destination for AI innovation and investment.

Secretary of State for Digital, Culture, Media and Sport, Jeremy Wright, said: “The UK is a beacon for international talent and at the forefront of emerging technologies because of the ideas developed in our world-leading universities.

“This new collaboration between Microsoft and Cambridge University will help us continue to develop home-grown AI talent and supports the government’s modern Industrial Strategy and £1 billion AI sector deal. It is crucial that we do all we can to capitalise on our global advantage in this technology.”

Business Secretary Greg Clark added: “The UK has an unmatched heritage in AI and its application in emerging sectors and technologies. This partnership between one of the world’s leading universities and technology developer and Microsoft is a great example of collaboration between business and academia.

“The UK’s leading research and innovation base are driving parts of our modern Industrial Strategy supported with the biggest increase in public research and development investment in the UK’s history.”

Those expecting an uneventful Budget were disappointed as the Chancellor announced some interesting changes to the taxation of businesses, writes Tim Shaw, partner at Ensors Chartered Accountants.

The principal changes announced are as follows though, as always, there are likely to be many changes announced in the small print which will need to be digested over the next few days. 

A temporary increase, for the two years ended 31 December 2020 in the level of the annual investment allowance to £1 million per annum has been announced.

Businesses will be able to spend up to this much each year on qualifying fixed asset additions and receive full tax relief in the year of acquisition. This is partly paid for by a reduction in the rate that capital allowances may be claimed on the special rate pool of six per cent per annum. 

Thankfully, the Chancellor put the immediate future of entrepreneur’s relief beyond question though he did double the qualifying investment period to 24 months. 

In addition, for disposals made on or after 29 October 2018, two new tests are added to the definition of a ‘personal company’. These require the claimant to have a minimum five per cent interest in both the distributable profits and the net assets of the company at issue in order for relief to be due. 

These changes are unexpected and could impact on ongoing transactions. With effect from April 2020, off-payroll working rules will be extended to the private sector, though the changes will not impact upon smaller businesses. 

The changes are likely to require companies to assess the relationship with contractors who provide services to them through personal service companies and operate payroll withholdings on payments made to the companies if the relationship is considered to represent that of employment. 

This could add a considerable compliance burden to businesses. Turning to R & D tax relief, whilst the repayable credit system is retained for small and medium sized companies, under the guise of an anti-avoidance measure, the Chancellor has announced that with effect from April 2020 the amount that a loss-making company can receive in R & D  tax credits in any one year will be capped at three times its total PAYE and National Insurance contributions liability for that year. 

As previously hinted, the Chancellor announced plans to introduce a UK Digital Services Tax. This will not be an online sales tax on goods bought online and will only be paid by profitable companies that have at least £500 million a year in global revenues.

The actual legislation will be subject to consultation first before the tax comes into effect in April 2020. It is expected to raise more than £400m a year, however it remains to be seen whether the companies will look to recover the tax from consumers.

The VAT registration and deregistration thresholds will not change for two years from 1 April 2020 and the registration threshold will remain at £85,000. In addition, motor fuel duties are frozen for the ninth year in a row.

Oxford2Cambridge Arc

The measures announced in support of the Cambridge-Milton Keynes-Oxford Growth Corridor are a further step towards making the region the UK’s next economic powerhouse, according to  property consultancy Bidwells. 

Recent Bidwells research found the Corridor’s economy would grow to £400 billion by 2050 if it continues expanding at four per cent – which Bidwells calculated is the average for the Corridor region since 1998 – as long as major investment is made in all types of infrastructure.

Today’s announcement of £20m of funding for the central section of East West Rail between Cambridge and Oxford via Milton Keynes is another step towards supporting this high level of growth. 

Patrick McMahon, Bidwells senior partner, said: “These measures are another step towards making the Growth Corridor the UK’s next Economic Powerhouse.

“The Government’s further support for its science and technology-focussed Industrial Strategy – coupled with this new infrastructure investment – puts this region at the heart of the UK economy. We called for clear government leadership on the Corridor project ahead of this year’s Budget and these announcements begin to provide it.”  

Bidwells recent research also found that an estimated 15-20m sq ft of further office and lab space, across approximately 540 hectares of land, will be needed to accommodate this £400bllion projected growth.