Why should the aerospace industry be so concerned that the DTI may abolish the Civil Aviation Research and Technology Demonstration programme? After all, the sum involved is a paltry £24m, at a time when the industry has just been awarded £320m to develop the next generation of Airbus A340 and Rolls-Royce Trent engines. And some argue that the fund is an anomaly, a source of support enjoyed by no other sector.
As the prime minister and industry secretary Peter Mandelson have noted, however, the successful economy of the future will be knowledge based. The UK’s prime examples of world-class knowledge-based industries are pharmaceuticals and aerospace.
Carad has a distinct function separate from launch aid. It is to develop technology for future generations of aircraft not the latest A340 or Trent, not even the A3XX superjumbo, but the generation after that. The City, says the aerospace industry, is unsympathetic to £24m disappearing off the bottom line for such long-range research.
Pharmaceutical companies have similar long lead times and high investment costs, but have a captive market in the NHS; plus, when a drug hits the market, investment costs are recouped quickly. A civil airliner can take 10 15 years to show a profit for its makers. And while the MoD is also, arguably, a captive market, there is little spin off between military and civil aviation technology.
So: anomalous it may be, there are strong arguments for keeping Carad, if the Government really wants to support knowledge-based industries, as Lord Sainsbury reaffirmed this week. And yes, £24m is a paltry sum compared with what our competitors spend. Even better would be a joint industry/Government Foresight Action Programme worth 10 times as much.