Earlier today, chancellor Rachel Reeves revealed ambitions to deliver “Europe’s Silicon Valley” in the UK by investing in an Oxford-Cambridge growth corridor. But one Edinburgh-based VC says it could exacerbate regional funding disparities.

In a series of announcements, Reeves promised to go “further and faster” to supercharge UK growth by backing a range of infrastructure projects from a third runway at Heathrow Airport, relaxing planning constraints, to redeveloping Manchester United’s Old Trafford football ground.

While Reeves’ ambitions down south might be a “positive step” for UK tech more widely, investment analyst Oliver Johnson-Watt at Par Equity warns that “true innovation” cannot be confined to the ‘Golden Triangle’ of Oxford, London and Cambridge.

“The UK’s tech leadership extends far beyond London and the South East, and the AI Opportunities Action Plan rightly highlights regional strengths in cities like Edinburgh and Bristol. Now we must build on these existing talent clusters rather than reinforcing legacy hubs” he explains.

READ MORE: Revolution or rhetoric? What Keir Starmer’s £14bn AI action plan really means for the North – according to the experts

He continues: “Energy and infrastructure investment must align with where AI can scale. AI data centres require vast energy capacity, and regions like coastal Scotland and industrial towns already have the necessary infrastructure. Investment should follow these natural advantages.”

“We need to see a truly national approach”

In her speech to Siemens Healthineers in Oxfordshire, Reeves referenced the “potential” and “promise” of Northern cities Manchester and Leeds, and pledged commitments to boosting regional infrastructure and investment.

Connectivity and investment in talent is crucial for regional hubs, says Katie Gallagher, managing director at Manchester Digital and chair of UK Tech Cluster Group.

“It’s positive to see recognition of Manchester as the fastest-growing tech sector outside of London, alongside commitments to regional infrastructure and investment through initiatives like the National Wealth Fund and Office for Investment pilots. Transport investment is critical, and we welcome the Chancellor’s commitments, including funding for the redevelopment of Old Trafford and wider infrastructure projects.

“However, while the Oxford-Cambridge Growth Corridor is undoubtedly world-class in research and innovation, ensuring its benefits extend across the wider UK must be a priority. We need to see a truly national approach that supports growth in all regions and prevents deepening economic divides.

“With the Chancellor’s commitment to go ‘further and faster,’ we hope this means real urgency in delivering the changes businesses need — including expedited reform of the Apprenticeship Levy under Skills England, which would be a game-changer for tech skills development.

“We look forward to more detail in the Spending Review and call on the government to back regional tech clusters with direct investment that supports innovation, talent, and scale-up growth outside of the South East.”

In Reeves’ speech, she set out how The National Wealth Fund is establishing strategic partnerships to provide “deeper, more focused support” for city regions, starting in Glasgow, West Yorkshire, the West Midlands, and Greater Manchester in a pledge to “support key investment” opportunities across the UK.

But there are still regional disparities that need to be tackled, according to Oliver Johnson-Watt at Par Equity: “The North represents a $1 trillion economy, yet it attracts only around 10% of UK venture funding. If it were a country, it would be the eight-largest economy in Europe. This imbalance must be addressed if Britain is to fully capitalise on its innovation potential.

“The US dominates global tech not just through Silicon Valley, but also through thriving innovation hubs in Boston, Austin, and New York. The UK should take inspiration from this nationwide approach, ensuring investment and opportunities are distributed across the country.

“If Britain is to lead in AI and deep tech, we need a national tech strategy that harnesses the full diversity of our talent, research, and industrial strengths – not just a corridor in the South East.”

For Richard Thompson, CEO at digital transformation company ANS, while it’s “promising” that Manchester is recognised as a leading UK tech hub, the government needs to do more.

“To continue to unlock our region’s full potential, the government must commit to further investment to support businesses developing the latest technologies from AI to Cloud. We must also see a focus on investment in our region’s talent to overcome the digital skills gap and foster long-term growth.”