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Anna Duggal
Anna Duggal
  • 1 Minute Read
  • 01st August 2014

Thriving Silicon Roundabout growth hits snag with £50m Government backing on hold

The last few years have been a great time for office space take-up in the Old Street and Clerkenwell area of London, most commonly known as the ‘Silicon Roundabout’. With 13,000 SME businesses moving into the Square Mile area alone, and the Mayor of London pitting himself as one of the ambassadors for its Tech City, it looked like the area was set to grow even more.

But, a project launched by Prime Minister, David Cameron, in 2012, to offer £50m of funding to dedicated state-of-the-art facilities for entrepreneurs and startups, has now been halted. After the Greater London Authority, overseen by Boris Johnson, failed to start the project in time, the money was returned to the government.

The Authority’s failure to start the project, though, points to the fact that an ‘electricity substation’ was under the roundabout, so they had been trying to find an alternate location.

According to business aid website Fresh Business Thinking, a spokesperson said: "Given that a permanent solution for the roundabout will be technically difficult and some way off, that money has gone back to general expenditure. It is normal practice for any money that hasn’t been spent to return to the Treasury to help reduce the deficit."

TechCrunch, a technology news site, said they understand that the Mayor’s team are now, “seeking alternative funding for a landmark proposal in Tech City and are collaborating on alternatives that might achieve the original objective over a shorter timeframe.”

Sadly, it seems the government and the Mayor are being a little hasty to speak and to promise positive business prospects to companies in the area, without actually being in the position to follow through on them.

This has been the case with the ‘Red Tape Challenge’ where the Prime Minister said in January, “first government in modern history to reduce overall domestic regulation for business while in office.” He claimed, “Supporting business is a crucial part of our long term economic plan, creating jobs and security for all. More than 1.3 million new jobs have been created since I came to office – many of them by small businesses.”

Between this, and Boris Johnson’s £1m start-up competition being deemed ‘a flop’, it seems the government is showing a front of support and initiatives to the growing business hubs of London, but then failing to implement them successfully.

Is this fair on the Tech City companies? The £50m project would have provided facilities to train 10,000 people – and that was just to start with. And, with the process of finding a project having taken so long in the first instance, will the area have to wait many more years to reap the benefits when the ideal location is eventually found and the building work completed? What’s your view? Get in touch now by commenting below or on our social channels.