Skills study ‘just an excuse to stall’

A government study into the engineering skills crisis will be used to justify abandoning the idea of R&D tax credits, suspect critics.

A government review into the supply of engineers and scientists in the UK has been branded a delaying tactic to stall the wider introduction of tax credits for research and development, by a senior member of the main standards-setting body for engineering, the Engineering Council.

The review was first announced in this year’s budget, alongside a consultation exercise on the introduction of R&D tax credits, and was followed two weeks ago by a consultation paper.

The two studies form part of the government’s efforts to improve the UK’s productivity levels. Ostensibly the idea of the latest review is to ‘ensure that businesses are not constrained in increasing their R&D and innovation through inability to find suitably skilled engineers and scientists’.

But Andrew Ramsay, director for engineers’ regulation at the Engineering Council, said linking the two studies in this way, under the overall banner of boosting UK productivity, was simply an attempt by the chancellor to avoid rolling out R&D tax credits to larger firms because of fears they may be used as a tax dodge.

Pressing ahead?

‘Brown is saying tax credits are a good idea in principle, but they won’t work because we don’t have enough scientists and engineers. It’s a pretty poor excuse for launching an inquiry that was long overdue in any case,’ said Ramsay.

‘The chancellor should have pressed ahead with the tax reform anyway, and didn’t need this inquiry to delay it,’ he added.

The final report of the review’s findings will be submitted to the chancellor, the trade and industry secretary and the education and skills secretary by next February, in time for the government’s 2002 Spending Review.

A Treasury spokeswoman denied accusations of delaying tactics. ‘We have pushed forward with the issue of R&D tax credits. Alongside that, we are looking at how we can improve the worlds of science and engineering, and encourage more young people to go into these areas.’

When it eventually publishes its findings, the review looks set to fuel a continuing debate about how to boost the calibre of young people going into industry. The research will examine the quality of engineers produced by the UK’s universities, as well as just the quantity.

Physicist Sir Gareth Roberts, president of Wolfson College, Oxford, who is conducting the skills study, is seeking the views of both employers and academics.The paper identifies several key issues. One is the skills gained by engineers at degree level and how these correspond to industry’s needs – a point which the Engineering Council itself has been trying to tackle with the promotion of Incorporated Engineer status and a re-think on the ideal length and content of engineering qualifications.

It will also look at how industry communicates its needs to universities, how well universities are able to respond, and how attractive jobs in R&D are compared to those in other sectors, such as the City.

‘It’s the sort of paper a lot of employers will want to respond to,’ said Ann Bailey, head of education and training at the Engineering Employers’ Federation, which is in the middle of its own review of the skills needed by industry over the next two decades. Bailey will be meeting Roberts to discuss the issues.

The reviews come as industry puts pressure on the government to tackle engineering skills shortages in the UK. Car industry leaders last week warned the government that skills shortages were deterring global firms from investing in the UK.

A group of executives, including Vauxhall chairman Nick Reilly, Ford of Britain chairman Ian McAllister and John Neill, chief executive of component supplier Unipart, made the comments while attending a seminar on the UK car industry, held by the prime minister’s policy adviser, Geoff Norris.

Timely review

A spokeswoman for Unipart said the government review was timely, as the company is having to recruit skilled engineers for its manufacturing sites in the midlands and south of England from a very small pool. ‘Anything that can further the skills of the employee base in the UK would be beneficial to the UK’s competitiveness,’ she said.

Nissan also warned recently it is facing a skills crisis. Managing director John Cushnaghan said the UK’s shortage of graduate engineers was causing alarm at its Sunderland plant.

The site was chosen by Nissan in January to build the next-generation Micra, boosting output and increasing the number of engineers needed by the company to carry out the work.

If manufacturing picks up, there will not be enough engineers to feed the growth, Cushnaghan warned.

Deadline for responses to the skills consultation paper is 31 July. To download the full document, use the following link:

www.hm-treasury.gov.uk/docs/2001/scientists-2006.html