APPG Meets UKSC: Strategy, Scale and Capability in the UK Semiconductor Sector

Last week, the All-Party Parliamentary Group (APPG) for Semiconductors convened in Westminster to examine the growing strategic importance of the UK semiconductor sector, with discussion focusing on its role in national defence capability, industrial strategy, and long-term economic growth. Against a backdrop of increasing geopolitical competition and greater attention on technological sovereignty, the discussion reflected on how semiconductor capability sits at the heart of modern defence systems and advanced industrial capacity. As warfare becomes increasingly technology-driven and supply chains more contested, the meeting reinforced the need for the UK to ensure that semiconductor technologies are more clearly integrated into both defence planning and wider economic strategy.

A central focus of the meeting was a presentation from Raj Gawera from the UK Semiconductor Centre (UKSC), who provided an overview of the work and evolving priorities of the Centre. His remarks offered a detailed perspective on how the UK’s semiconductor ecosystem can be strengthened in the years ahead and how the UKSC aims to support this process through industry coordination, strategic planning, and ecosystem development.

It was explained that the work of the Centre is structured around three overarching priorities: Growth, accelerating the scale-up of UK semiconductor companies; International Reach, strengthening global partnerships and inward investment; and Impact, ensuring the sector delivers tangible outcomes for the wider economy. Together, these priorities are designed to ensure that the UK semiconductor sector can expand its economic footprint, deepen its global partnerships and strengthen its role within the UK’s broader technology strategy.

To deliver this vision, the UKSC is working towards several key outcomes for the sector. These include Scale-Up, accelerating the growth and scaling of UK semiconductor companies; Skills and Workforce, developing the highly skilled talent pipeline the sector requires; International, building stronger global partnerships and attracting inward investment; Strategy and Roadmap, establishing an aligned national strategy supported by a long-term investment roadmap; and Ecosystem and Advocacy, strengthening the visibility and connectivity of the UK’s semiconductor innovation landscape.

The presentation also outlined a number of practical activities designed to support these objectives. These include Investor Convening, bringing together investors and industry to improve access to capital; Funding Pathways, developing clearer routes for companies to access the investment needed to scale; Pilot and Prototype Facilities, enabling companies to transition technologies from research into commercial deployment; Skills Foresighting and Skills Convening, anticipating workforce needs and strengthening the talent pipeline; and Ecosystem Mapping, improving visibility of UK semiconductor capabilities and identifying opportunities for collaboration.

Alongside ecosystem development, the UKSC is also focusing attention on a number of technology areas where the UK has the potential to play a leading global role. These include Future Compute, enabling next-generation computing architectures; Photonics and Photonic Integrated Circuits, advancing optical technologies for communications and sensing; Advanced Packaging, improving performance through innovative chip integration techniques; Compound Semiconductors, building on the UK’s established leadership in this field; and Power Electronics, supporting the electrification of transport and energy systems.

These technology priorities are closely linked to several emerging application areas expected to drive demand for semiconductor innovation in the years ahead. Among these are AI Data Centres, supporting the rapid growth of artificial intelligence infrastructure; Edge AI Devices, enabling intelligent processing at the device level; and Quantum Technologies, supporting the development of next-generation computing and sensing capabilities.

The presentation prompted a wider discussion about the challenge of scaling the UK semiconductor industry more effectively. Scaling occurs at multiple levels across the ecosystem. Large semiconductor companies require the right infrastructure, investment environment, and policy certainty to expand advanced manufacturing capability. At the same time, many of the UK’s most innovative semiconductor technologies originate within small and medium-sized enterprises, which often require targeted support to commercialise their innovations and integrate into global supply chains.

Supporting both parts of the ecosystem will be essential if the UK is to develop a resilient semiconductor industry. Policy frameworks must recognise the different needs of larger manufacturers and smaller technology innovators, ensuring that the sector can grow in a balanced and sustainable way.

The discussion also reflected on how the UK’s semiconductor conversation has evolved in recent years. When the APPG on Semiconductors was first established in 2023, much of the national focus centred on the UK’s strengths in semiconductor design. While these capabilities remain an important advantage, there is now increasing recognition that manufacturing capability and supply chain resilience must also be central to the UK’s long-term semiconductor strategy.

Strengthening domestic manufacturing capacity alongside the country’s established design expertise will be critical if the UK is to build a more robust semiconductor ecosystem and ensure that the sector can support both economic growth and national security objectives.

The meeting concluded with a recognition of the clear alignment between the work of the APPG and the UK Semiconductor Centre. The APPG is keen to develop a constructive working relationship with the UKSC, ensuring closer collaboration between Parliament, industry, and the Centre as the UK continues to develop its semiconductor strategy. Strengthening this alignment will help ensure the sector moves forward with a shared direction.