The Engineer

UK risks losing advantage

News

The UK will face decades of slow economic decline unless it invests heavily in research - one of the country’s few genuine areas of economic competitive advantage, according to a report by the Royal Society.

The report warns that the UK’s current advantage is in danger of being wiped out by the US, China, India, France and Germany, who have ramped up spending in science to boost their economies.

’As France announces a new €35bn investment in the knowledge economy, the UK cuts university budgets by £600m, with the threat of more to come. History shows us that new technologies drive economic development - look at the industrial and digital revolutions. The UK has been in the top two of the scientific premier league for the last 350 years. It would seem obvious that politicians would recognise the need to invest in this competitive advantage rather than cutting funds,’ said Sir Martin Taylor, chair of the report’s advisory group.

The report highlights last year’s announcement of a $21bn (£14bn) boost for science in the US and recent claims from American scientists that they will steal our finest minds if UK investment slips. The report also draws attention to a recent €35bn (£31.7bn) investment in the ’knowledge economy’ by France, a commitment from the German government to increase its federal budget for education and research by €12bn by 2013 and the year-on-year increase of 20 per cent in China’s science spending over the last decade.

The report busts the familiar myth that the UK is good at science but bad at exploiting its results. It highlights the emergence of an innovation economy in the UK with universities becoming fledgling economic powerhouses. Patents granted to UK universities increased by 136 per cent between 2000 and 2008 and university spin outs employed 14,000 people in 2007/08 and had a turnover of £1.1bn.

While the report also cites examples of science driving successful sectors of the economy such as pharmaceuticals, business R&D is picked out as a weakness for the UK. In 2007 British companies spent 1.14 per cent of GDP on R&D, while in the US the figure was 1.9 per cent and in Germany 1.8 per cent.

To maximise the economic opportunities from science the Royal Society report recommends creating a 15-year framework for science and innovation, with increased spending, prioritising investment in scientific skills and infrastructure, such as laboratories and equipment, and expanding the R&D tax credit.

Speaking at the launch of the report, Lord Sainsbury - the former science minister and member of the advisory group - said: ’In the last 20 years our universities have risen to the challenge of commercialising their research and figures now show that the record of our world-class universities is close to that of top American universities, with high-tech clusters growing strongly at not only Cambridge and Oxford but also in Manchester, Southampton, Surrey and York.

’We cannot compete with countries such as China and India on the basis of low wages, and science and innovation must, therefore, be the basis of the strategy for growth that we need to have as we go into a tough period of fiscal consolidation.’

The report also contains recommendations on prioritising investment in excellent people, strengthening science within government, reinforcing the UK’s position as a hub for global science and innovation, better aligning science and innovation with global challenges and revitalising science and mathematics education.