Are the mechanisms in place to support UK research and development efficient and sufficient for their purpose?
A report published by ONS in June states that government expenditure on R&D in science, engineering and technology grew by 6.4 per cent to £12.2bn in 2017.
According to ONS, UK research councils contributed the most to expenditure on SET in 2017 at £3.8bn.
The same report highlights the aim of the government’s Industrial Strategy to raise investment in R&D to 2.4 per cent of GDP by 2027.
But are current levels of state support focussed correctly, and are challenges around accessibility to funding stifling innovation and growth for smaller entities?
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Further reading
- Manufacturers are missing out on R&D tax relief
- UK’s top 1,000 companies invest £25.3bn in R&D
- Boom or bust? Brexit’s impact on innovation and R&D
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Should government funding be allocated to R&D that could be more properly funded by the company which hopes to profit from it, and is the balance between fundamental and industrially focused research weighted fairly?
We put this to Engineer readers in last week’s poll, with 52 per cent of respondents agreeing that not enough information is available about what support can be accessed.
A close split in remaining votes saw 14 per cent agreeing that state support for R&D is too focussed ‘near market’, and 13 per cent thinking that it is too concentrated on fundamental research. Only nine per cent think current levels of support are effective, and the remaining 12 per cent opted for ‘none of the above’.
In the comments that followed, Another Steve said: “Personally, I believe the best way to access state R&D funds is through a system of formal bids for funding with large commercial organisations being obliged to match the state funding 50:50. Also, we need a system that ensures that state funded R&D is suitably controlled such that big organisations are not able at some point in the future to buy up patents and IPR and hold the state to ransom when productising the research.”
Highlighting accessibility issues for individual inventors and smaller companies, John Patrick Ettridge said: “Most of all R&D funding goes to Universities or very large corporations, who can afford the costs associated in receiving these grants or funds. Innovative ideas are ignored or lost to the country due to lack of funding, as most private funds only want to invest in commercialised ideas.”
What do you think? Let us know in Comments below, but take a look at The Engineer’s Comment guidelines for readers before making a contribution.
Turning research ideas into profits! surely that is the key. I do believe that ‘we’ place so many obstacles in the way, that it is only luck that applies!
Some Research into that: now that’s a possibility?
The trouble with the R&D allocation of funding is that it is to difficult to access for individual inventors or small companies. Most of all R&D funding goes to Universities or very large corporations, who can afford the costs associated in receiving these grants or funds.
Innovative ideas are ignored or lost to the country due to lack of funding, as most private funds only want to invest in commercialised ideas.
Much research funding is too “near market” (or too IMPACT) focused; this leaves a gap in which innovative research is difficult to support.
Companies tend to look at incremental research (which is really more D than R&D) – because it is less risky.
So this leaves a gap where radical innovative R&D is difficult to fund and, too, is undesired.
I believe that it is proper for public funds to be used for (such) innovative R&D; it is proper because it is not funded and the country needs it.
Innovative R&D should not necessarily produce an innovative product (which business innovation requires) but an ensemble of such research could so do – with likelihood of being disruptive.
History doe show us some examples of well focused and innovative R&D. Wedgwood, when inventing his (disruptively) innovative ceramic, developed several manufacturing and design innovations; such innovation being fully developed and ready for use (application and market access); or a similar situation could be pointed out for Paxton’s Crystal Palace.
Advanced manufacturing is a way of doing what one cannot do – and, quite likely, doing it cheaper and better too; this requires the development of machinery – before any final products can be made (or even designed).
So R&D support might well be most cost-effective at establishing new companies (startup) and especially in advance manufacturing.
And as radical (manufacturing) innovation is often cheaper and produces previously unavailable materials and parts it would be more efficient use of R&D funding.
This does not solve all problems as sectors, such as aerospace (for example) are shy of radical lighweighting or the nuclear industry shy of structured materials for pressure vessels and fuel cladding or the construction industry and thermal energy management
My experience is limited …. but…although I think that the UK is beginning to get the message very slowly with things like catapults etc, the conditions for research in companies are not that great. Lots of people in my industry talk about what they spend on “R&D” which is ridiculous because it’s entirely “D” and without it they would loose immediately to their competition. “D” usually always has a payoff but Research strikes me as being the kind of risk that will often not pay off but pushes industry forward by leaps when it does. If you look at how much money gets thrown around in the US at space technology or any of a number of other highly risky things I feel their system is working in its own way. In another way the Germans perhaps make existence easier for SMEs so they can do quite a lot of development and adopt research and take limited risks. I admit this is based on impressions which I would be glad for someone to correct.
Based upon my experiences, I’m not sure that tax credits are the best way to go. In the past I’ve witnessed the unseemly rush at the end of the tax year by Managers and Accountants to ‘find’ projects that could be labelled as R&D so that tax liabilities could be minimised. This type of behavior will always occur where the ‘bottom line’ is involved and it doesn’t help true R&D one bit.
Personally, I believe the best way to access state R&D funds is through a system of formal bids for funding with large commercial organisations being obliged to match the state funding 50:50.
Also, we need a system that ensures that state funded R&D is suitably controlled such that big organisations are not able at some point in the future to buy up patents and IPR and hold the state to ransom when productising the research, ie. I’m primarily thinking of the NHS and ‘Big Pharma’ but this also applies to other sectors like Defence (eg. the current sell off of Cobham).
‘Another Steve’ is prescient in that he mirrors some of the comments made by Mr. J Corbyn on Radio 4 this mornings. I found myself in agreement with all above contributors and again Mr Blamey makes the killer point – all the R&D effort in the world is not sustainable if at the end one cannot capitalize on it or is leapfrogged by others to so do (ex penicillin, jets, computers…). In support of Mr. Ettridge, the other issue is that universities cannot well defend any IPR as their function is to teach ( vis nanotechnology research to Chinese military students – maybe that’s not a good example?) and most large corporations seem now to be foreign owned so any UK gov funded IPR generated no longer benefits the UK long term ( remember DERA -> Qinetiq ?) . My understanding is that in some other countries, the state seems to invest and take a stake in their indigenous companies so that any benefit to the company also benefits the state ( ex Finmeccanica, Airbus). In the UK, government seems to (sometimes) offer inducements for inward foreign investment but without a profit sharing and IPR protection stake but is then still called on to rescue failing ventures. Then again without a coherent long term ( ie trans- generational), persistent ( ie trans-political) strategy, which successive UK governments have not , to my mind, demonstrated, then such parsnips will remain un-buttered.
Better information would be a start. Trying to find anything via the http://www.gov.uk website is a pain and every time a government department is merged, renamed or abolished they create a new sub-domain breaking all the links that used the old name & resulting in “page not found”
As Trevor mentions the lack of information in government web-sites is a pain; I believe it reflects a disorganisation and reflects a lack of coherent think on the subject of innovation and R&D.
Perhaps that is the most important thing; to get the economists to appreciate the scientific view of innovation and develop a structure of information and networks to support this (I am not sanguine of this happening and suspect that a “cargo cult” view of innovation/science & R&D is common)
In the USA (unlike the UK)
Small Business Innovation Research (SBIR) is a way of getting innovative research done by small companies; it has been successful and efforts are required, I believe, to stop large companies getting access to it.
I believe it allows small companies (AND startups) to do research and is well funded (I believe that it can effectively be a 100%). The research can be proposed by a collaborative group but they perform it as an agent of the government department; this does allow for problem solving but it also allows for freedom for the research & development of new (innovative) technologies.
Thus a proposal can be prepared the includes the manufacturing and design technologies – and allows for, for example, follow on R&D in applications.
An example of such is cellular materials (with company of same name) – an SBIR formed startup. (based around ideas developed by Prof Mike Ashby, at Cambridge)
It is true that academic institutions have the range of skills/people and equipment for such startups – which is significantly different from trying to spin-off a research idea – as startups need to address ideas and make them well formed and posed for success – which usually require a range of research fields (often including manufacturing).
So SBIR allows for research to prepare for development and success (eg a super-insulation is no good if it cannot be evacuated quickly and cheaply at reasonable size – i.e. the technology needs to scale-up for manufacture; and the design needs to be able to support the manufacture – and in the case of vacuum insulation, for example, survive rough handling and installation on the construction site.
The idea that VCs or big companies buy up the startups is a threat (as they may not appreciate the technology) but small groups are better posed to resist and strike deals that are better for their research interests. (Though I suspect that follow on grant funding might be required to support patents and growth strategies – the sort of “innovation” of products that fits with the New Product Development/marketing ideas of economists.
I must admit I was torn between the two “too targeted” options – I suspect that it is possible to do both at once! (Who would have thought ?-/)
And I believe it is difficult to find out what is available (at least I had found it so) – though what there is is most likely not very effective – at least in getting innovative Research.
I agree with Mr Ettridge that funding goes to the big institutions – with the proviso that the Mathew effect is in full swing! (i.e. if your institution has a grant then it is is easier to get more funding – not matter how limited the proposals are in the innovative side !)
During a brief period of being a staff member at what purported to be a university. I was required to attend a Course: to learn the key-words that should appear in any application for funds.
Cross-fertilisation, inter- and multi- discipline, EC connected (presumably that one is soon to be out!) offering quality in initiatives and scope are some I recall. I did have occasion to suggest that in my experience, most successful projects are completed in spite of the support of the State, not because of it! [I was not popular: as I was striking at the very reason for far too many projects: foreign liaison and travel.