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First indication of Conservative priorities for science and engineering

14 Nov 2019

James Tooze digests the Prime Minister’s speech and accompanying press release

The election is well and truly in full swing as all political parties are set to confirm their Prospective Parliamentary Candidates by the end of today. While parties have yet to publish their manifestos ahead of the vote on the 12th of December, yesterday gave us an early insight into the thoughts of the Conservative party with regards to science, research and innovation. The Prime Minister gave a speech in the West Midlands yesterday, and amongst political jostling expected in the run up to an election, he stated that if a Conservative party Government was to be elected they would increase domestic public R&D investment to £18bn by 2024/25. Despite this increase, we have concerns over the party’s position on potential replacement of access to EU funding programmes by domestic alternatives. We have since received more details about this proposal and can break down what this pledge might mean for science and engineering.

The pledged increase to R&D funding is a welcome one, and effectively recommits to the Conservative Government target of increase research intensity to 2.4% of GDP by 2027. Expressed within the accompanying press notice is reference to “the 2.4 per cent target”, so it appears for the moment that the 2.4% target remains a Conservative priority. Johnson said that this increase would represent the doubling of public R&D spend in the next parliamentary term, but this increase would only represent a doubling in cash-terms, and not in real-terms when accounting for inflationary changes. If this domestic increase is also to account for a replacement of EU research funding, it is even further behind ‘doubling’ research funding in real terms.

In 2017, the UK’s public purse invested £9.1bn in R&D, so the pledge to increase public investment to £18bn is a large increase and, if it happens, would demonstrate a real step change in research funding. We have previously carried out work trying to project the uplift in funding required to reach the 2.4% target, and our projections show that public investment will need to reach £18.5bn in 2024/25 to be on track. This figure is fairly close to the pledge made yesterday, and steeper increases in public funding in the years after could see the Government achieve its target.

CaSE projection of what is required to meet 2.4% target by 2027, with our recommended public investment figure in 2024/25 highlighted

The accompanying press notice from Conservative HQ was able to provide more detail in to funding announcements and plans the Conservative party would adopt should they win a majority. The first proposal that had already been revealed in the Queen’s Speech was the creation of a new British Advanced Research Projects Agency, similar to the US ARPA model of funding high-risk, high-reward research. The establishment of this research agency would see £800m awarded over the next five years, pursuing research that may not been supported under current funding streams. Without giving too much more detail, there is an explicit mention of using some of this funding to support blue skies research investment too. It may appear that the fund will not strictly be used to support products close to market but help to fund high-risk research across disciplines and technology readiness. We will wait to hear more about the development of this agency, working to ensure it adds to the diversity of support available to UK research without complicating the landscape or being introduced at the expense of other domestic research funding.

Also referenced is the need for Government policies to incentivise private R&D investment, a key element of reaching the 2.4% target. We have written a lot over the past couple of years about the Government being an effective customer of research, and public procurement of innovation as a driver for technology adoption and advancement, including in our recent five point plan for science and engineering. The Conservative party note recognises this and says the party will establish a new Challenge Led Innovation Procurement Fund which will provide innovative firms with capital. Much like the US ARPA programme, US research has benefitted greatly from a strong market-pull with US Government acting as a key customer of innovative products. We are pleased to see the recognition of this from the Conservative party and hope others will recognise the importance of Government as a driver of innovation by procurement, but we will need to see the details of any such plan and work to ensure the programme can be effective in the UK. Included within this statement is the party’s intention to extend the innovative loans pilot, run by Innovate UK to support SMEs involved in late-stage innovation projects.

While all of these announcements are good news, something more concerning was published in the press notice. Quoting directly, the statement read: “This huge investment will replace EU funding”. While it is unclear what this may mean in the long-term, it appears that the Conservative party plans on replacing EU funding with domestic increases, casting doubt over the UK’s future relationship with Horizon 2020 and its successor, Horizon Europe. While the statement confirms that loss of EU funding will be replaced in full by domestic funding, CaSE’s position has always remained that participation in EU funding programmes means more than the direct financial benefit and the intangible benefits can often be considered more important that the monetary benefits. If there are to be domestic alternatives, it needs to be made clear how such programmes would foster international collaboration and enable the same kind of intangible benefits.

While domestic alternative arrangements may be made, being frozen out of EU research collaborations could pose a major risk to the quality, competitiveness and openness of UK science and engineering. It would take a number of years to establish the same prestige of alternative funds as are enjoyed by EU funding programmes, which could increase the chances of top researchers looking elsewhere. EU grants also play a key role in facilitating mobility between the UK and other European countries, allowing talented individuals and their ideas to enhance the UK’s research base. This also represents a change in direction from merely weeks ago, where Science Minister Chris Skidmore indicated the Government still preferred to align with EU funding programmes. This represents what could be a damaging step for UK research. We will continue to press all political parties to ensure that full association with Horizon 2020 and Horizon Europe are a top priority and are crucial for the success of UK science and engineering.