Delays in computer chip development plan ‘harmful’, British MPs warn

MPs warn that the government’s continued delay in unveiling the UK’s semiconductor strategy amounts to an “act of national prejudice”.

The criticism came because the government refused to tell MPs when the strategy, which had been in the works for two years, would be made public. Ministers could only say that the review, which was originally due last year, would be “published as soon as possible” but could not give a date.

There are growing fears that restructuring the production and supply of vital industrial components used in everything from computers and phones to automobiles will be too late to change anything.

Industry experts fear the review has been delayed by a combination of government disorganization and US demands that semiconductor makers not sell chips to China, including chip makers in countries with strong ties to the US have joined the UK’s effort to develop its own alignment plan.

While the UK hesitates over its strategy, Washington is offering more than $50 billion in grants and the European Union is planning its own billion-dollar grant program.

British tech leaders last week urged Prime Minister Rishi Sunak to develop a strategy to secure the future of the UK semiconductor sector or risk losing it altogether. In the letter, they said that the UK was once a world leader in this field and is still home to renowned chip design companies and other industry leaders.

One of Britain’s leading semiconductor companies, Arm, was sold to foreign buyers in 2016, and efforts to persuade the owners to bring the company to the UK have failed, despite the prime minister’s own efforts. The Japanese owners also laid off employees at the Arm base in Cambridge.

Darren Jones, chairman of the Business Select Committee, which produced a report before Christmas calling for urgent government action to support key industries, denounced continued delays in the release of the strategy.

The commission’s report clearly states that significant financial support will be needed to support chipmakers and supporting industries.

“Countries around the world have realized the importance of securing semiconductor supply chains for their future; Why not? While others get ahead of themselves and invest billions in building factories [fabrication plants] or industry support, we’re not even there yet.

“Two years of work, but no strategy yet. Any further delay will be an act of self-mutilation to the nation. With a 40-day budget, the strategy needs to be published urgently.”

The report warned that the UK government should work more closely with the US, the European Union and other allies to better protect both the security of the supply of the chips themselves and the materials used to make them.

Supplies to the UK have been severely disrupted during the pandemic and Chinese threats to Taiwan, a key source of chip production, will leave the UK vulnerable.

Growing awareness of the importance of semiconductors to the UK economy and the need for a national strategy escalated last November when the government used the National Security and Investment Act to void a deal to acquire Newport Wafer Fab by Nexperia’s Dutch subsidiary. in 2021 by the Chinese group Wingtech. The Newport plant is the largest chip manufacturing facility in the UK.

Mr. Jones criticized the government’s failure to fully respond to the parliamentary report, saying: “This is a poor excuse for the government to hide behind its failure to publish a semiconductor strategy because it does not fully meet our best practices.”

A government spokesman said: “We are committed to supporting the vital UK semiconductor industry. Our strategy will follow the recommendations of the committee, including ways to further develop the industry and ensure a sustainable supply chain. The strategy will be published as soon as possible.”