The UK must do a better job of developing IT and management skills or risk losing out to offshore competitors, a cabinet minister has warned.
Speaking at the Internet World show, Trade and Industry secretary Patricia Hewitt advised that UK businesses need to accept that global competition is a reality, and do a better job of turning ideas into products and companies.
"India is creating quarter of a million new IT and science graduates every year and challenging us for call centre and back office jobs. We have to respond to that challenge, but not with protectionist barriers and pretending that technological change isn't going to happen," Hewitt said.
"We need to produce people with better skills, help businesses create better products and services that everyone around the world wants to buy, and develop people with the management skills to fight off these challenges."
Hewitt admitted that red tape was still a huge issue facing smaller companies but said it was something her department was keen to simplify.
"We know our prosperity depends on business success and increasingly the jobs and the new ideas come from small companies. Raising the rate of entrepreneurship is central to our policy," she said.
The Department of Trade and Industry has launched a consultation on directors' pay, which could lead to the curbing of the 'fat cat' pay culture that saw even directors responsible for disastrous judgements walking away with pay-outs worth millions.
Hewitt said that although the internet boom and bust had cost shareholders billions, it had also resulted in some "very good high-tech companies".
"We went through an extraordinary bubble with 'dot-connery' but I also think that we've been left with some very good high-tech companies and we've made it much easier for start-ups to bring in experienced people by offering them share options as part of the package," she said.
"Finding ways in which employees can share in equity is hugely important."
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