To ‘kickstart economic growth’, a Labour Government must work with our industry

Jul 2nd '24

Christie Dennehy-Neil, IAB UK’s Head of Policy & Regulatory Affairs, sets out how a Labour government will approach digital ad regulation.


The manifestos are out, TV debates are raging and – more than ever before – the political parties are turning to social video to capture all-important Gen Z votes. As it stands, Labour is well ahead in the polls and it looks very likely that a Starmer-led government will be in power come this Friday, ending 14 years of Conservative leadership.


But what does Labour’s manifesto tell us about how the front-runner for No.10 will approach digital ad regulation? And – with 81% of all UK ad spend now invested in digital media – what does it mean for the ad industry?


What we know from the manifesto

While ensuring online safety and regulating emerging technology – primarily AI – are both included within Labour’s manifesto, there isn’t an overriding focus on digital technology or media. We know that the HFSS ad ban will continue to be implemented and that the Online Safety Act will be built on, potentially with further online safety measures specifically for social media.


Combatting fraud is also singled out as a priority, with a new expanded fraud strategy intended to tackle the issue both online and offline. As part of this, Labour will work with technology companies to stop their platforms being exploited by fraudsters. It will also create a ‘Regulatory Innovation Office’ aimed at speeding up tech regulators’ decision-making, improving accountability and promoting innovation.


In short, none of this is particularly unexpected and largely signals a continuation of the priorities established by the Conservative Government when it comes to ensuring consumers’ online safety.


Chiefly, Labour’s focus is on delivering economic stability. From positioning itself as “the party of wealth creation” to its plan to “kickstart the economy”, supporting investment and business growth and raising living standards are fundamental to the party’s vision for the future.


That’s significant because a thriving digital ad industry is essential to the health of the UK economy – it generated £129bn for the country’s coffers in 2022 and supported 2 million jobs across the nation, according to IAB UK’s Digital Dividend study. Meanwhile, businesses that invested in digital advertising saw a combined sales uplift of £73bn, with £26bn of that among SMEs.


It’s also easy to forget that the ad-funded web allows all of us to have free access to a huge array of content and services online. The average UK household saves over £600 a year as a result of the ad-supported digital model, with people’s lives enriched by the wealth of information and entertainment that’s just a swipe away.


If that value exchange is undermined by overzealous or poorly designed regulation, it threatens our current digital democracy – where anyone can access the internet for free – and risks harming business growth, setting the UK back on the world stage. It’s vital that this is front of mind for the incoming government.


A chance to take stock

If Labour is elected, there is a valuable moment to take stock and reassess how to address challenges within the online ecosystem. The Conservative Government’s Online Advertising Programme identified two specific areas of focus – protecting children online and addressing illegal advertising. Both are hugely important, but a lot more work is needed to properly define the issues, assess the evidence available and build on it to create lasting solutions.


To deliver that, Labour would need to take a step back and not automatically pick up where the Tories left off, entrenching a problematic approach. The new government should take time to understand, define and prioritise the challenges it wants to address and arrive at evidence-based conclusions.


However unintentionally, blunt policies that focus on headlines rather than outcomes risk having a very real impact on the millions of small businesses in the UK that rely on digital marketing to reach their consumers. To avoid that, Labour must work with our industry and draw on the wealth of expertise we can offer to implement effective solutions that support a thriving and trusted online ecosystem.


The case for collaboration

There is cause for cautious optimism in Labour’s commitments to take a pro-business approach to regulatory frameworks and provide a stable policy environment that delivers certainty to support investment and growth.


The party talks about ‘working with’ industries and sectors to achieve outcomes. The digital ad industry will be looking closely at how this translates into practice and how willing a Labour Government is to work with us to implement effective, proportionate and future-facing solutions that utilise technology to combat challenges.


For this reason, and if the polls are right, we’re calling on Labour to take a considered and collaborative approach when it comes to digital advertising. We need policies that both manage the risk of consumer harm and support the UK’s digital advertising industry – and the wider digital economy – to thrive. This includes maximising the effectiveness of existing legislation and regulation, including industry-led initiatives such as the IAB UK Gold Standard.


That’s how we ensure the ad-supported model remains viable so that the internet remains free and open, for the benefit of everyone.


Source: Internet Advertising Bureau (IAB UK)


About the IAB

IAB UK unites the digital advertising industry to champion innovation, set shared standards and make the complex simple by bringing together over 1,200 members from publishers, ad tech providers, agencies and brands. Learn more, here.


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