Horizon Europe: UK Participation

Lord Patel Excerpts

Tuesday 31st January 2023 Lords Chamber

[Lord Callanan (Con)]

My noble friend gets the Opposition riled more than I do sometimes. Criticism of the EU is almost blasphemy in some parts of this House, but the reality is this is the fault of the EU. We stand ready to continue the negotiations and to associate as soon as the EU is prepared to talk to us about it.

[Lord Patel (CB)]

My Lords, not only are we not a member of Horizon Europe but we are not part of Euratom. I believe that has led to supply problems of radioisotopes imported for both treatment and measurements in medicine. What are the Government doing about that?

[Lord Callanan (Con)]

Indeed. The noble Lord is correct. We are working to overcome those difficulties as quickly as we can.

Manufacturing Post Brexit

Lord Patel Excerpts

Thursday 26th January 2023 Lords Chamber

[Lord Callanan (Con)]

I know that the noble Lord is passionate in his views on this, but I am afraid that I just do not agree with him that nationalising the car industry is the way forward. The noble Lord will have been around in the 1970s when we saw the decimation of the UK car industry under state control. The future is not state control; the future is what we are doing, which is incentivising manufacturers to move to the UK. The case of Britishvolt is very disappointing, but the money that we had available remains on the table. We very much hope that other companies will show interest in the excellent site in Cambois, near Blyth, and we continue to do all that we can to encourage investment in the UK.

[Lord Patel (CB)]

My Lords, the Minister mentioned the Government’s support for life sciences, and I applaud the Government for their strong support. But recent reports, particularly from big pharma in the United States, suggest that despite the £1 billion investment we had last year, it is now slowing down compared with investment in Europe and the USA. What other encouragement can the Government give to have inward investment from overseas?

[Lord Callanan (Con)]

I know that the noble Lord is very expert in this area, and we have discussed it before. We need to do all that we can to encourage life science investment; the UK has one of the most successful life science sectors in the world. We need to make sure that investment continues to flow into this country, and we want to use all the policy levers open to us to make sure that that success story continues.

Battery Strategy (Science and Technology Committee Report)

Lord Patel Excerpts

Wednesday 23rd November 2022 Grand Committee

Moved by

[Lord Patel]

That the Grand Committee takes note of the Report from the Science and Technology Committee Battery strategy goes flat: Net-zero target at risk (1st Report, Session 2021-22, HL Paper 53).

[Lord Patel (CB)]

My Lords, it is a pleasure to open this important debate on the Science and Technology Committee’s report, entitled Battery Strategy Goes Flat. Before I do so, I thank all those who gave evidence to the committee: our committee staff; the committee clerk, Dr Simon Cran-McGreehin; our analyst, Dr Amy Creese; Ellie Hassan, a POST fellow and the committee constant, without whom chaos would prevail; and Cerise Burnett-Stuart, the committee operations officer. I most sincerely thank them all.

My particular thanks go to our specialist adviser, Professor Clare Grey FRS—who has recently become Dame Clare Grey DBE FRS, and who I am pleased to say is listening to us—and Geoffrey Moorhouse Gibson, professor of chemistry at the University of Cambridge. Their advice, knowledge and expertise guided the committee. Last but not least, I thank all the committee members for their help and hard work; they were never controversial, and they never challenged me, at least.

I regret that, due to previous commitments, our current chair, my noble friend Lady Brown, is unable to take part today. I am grateful to the Minister for taking time to reply to the debate today; I have no doubt that he will do so in his much-appreciated customary manner of answering the questions raised by those speaking and not just sticking to the brief provided. I most sincerely thank all noble Lords, not just the members of the committee, for making time to take part in today’s debate.

The title of our report is Battery Strategy Goes Flat: Net-Zero Target at Risk, and it was published on 27 July 2021. At the time, it seemed a provocative title, but subsequent events and the recent news seem to have confirmed our scepticism. The report—which has four key chapters covering the applications of batteries and fuel cells, technological developments and, importantly, strategic issues facing the UK for decarbonising the transport system—makes several conclusions and suggests government action to make the UK a leader in batteries and fuel cells. The Government’s response, while not disagreeing with the conclusions or details in the report, was not convincing as a clear delivery plan. Most of the responses to our ask for government action used the phrase, “The Government are committed to”, but provided few details as to implementation. I hope that the Minister, in responding, can put that right today.

At the time of the report’s publication, the committee felt that the UK policy of battery manufacture was insufficient to meet the future needs of the automotive industry as it transits to the government policy of full electrification of cars and smaller commercial vehicles by 2030. The requirement of seven to eight gigafactories by 2030, as suggested by our witnesses, is not likely to be met; in turn, our net-zero commitments will not be met either. The committee felt that the pace and scale of the building of gigafactories in the UK will not meet the demands for batteries by the automotive industry, and the UK would risk losing much of its automotive industry to overseas. In our evidence sessions, many witnesses felt that the UK faced serious challenges from our competitors, and that we were behind them not only in the manufacture of batteries but in innovations, supply chains and skills.

I recognise that the UK now has a critical minerals strategy to fill the gap in supply chains—a positive step—but no clear implementation plan, without which the UK will again miss out to competition for securing much sought-after minerals.

We were astonished by the stark disconnect between the optimism of Ministers and officials and the evidence from our many witnesses that the UK will be unable to maintain its automotive industry. The two immediate deadlines, of 2027, when the rules of origin agreement will require batteries and 55% of components to be manufactured in the UK or the EU, and 2030, when production of all petrol and diesel cars and vans will cease, are unlikely to be met. Without scaling up the domestic manufacture of batteries and urgently focusing on improving the supply chain of materials, the UK will end up importing batteries and vehicles.

A recent report in the media summarised well the current state of battery manufacturing in the UK and the future of the automotive industry. Recent events have put an end to the UK’s ambition to be a global hub of the electrified automotive industry. BMW has announced the end of production of its electric Mini in Cowley, which it is moving to China. Johnson Matthey, a leader in the development of battery technology in Britain, has quit the sector, citing competition from China and South Korea as a reason. Arrival, once a promising enterprise for the manufacture of electric vans and buses in the UK, is rumoured to be moving to the USA.

When it comes to battery manufacture, Britishvolt, once highly trumpeted as the UK’s big gigafactory, is now reported to be in serious difficulty and is possibly facing insolvency. Another such enterprise at Coventry airport has hardly got off the ground. This leaves the UK with one gigafactory, so it seems we have lost out on the international race to manufacture lithium-ion batteries.

The UK still needs the capacity to supply its domestic market, so I ask the Minister: what plans do the Government have to attract investment in building gigafactories for the production of batteries in the UK? How many will there be, and what is the timescale for when such facilities will be up and running? Does he think the UK can still meet its commitment to phase out petrol and diesel cars by 2030?

Although we may have lost the race to be the global hub of lithium-ion batteries, the UK could be a leader in the development of the next generation of batteries, such as solid-state, lithium-sulphur and sodium-ion technologies. To exploit the competitive advantage that we currently hold, the Government need to show strong support for both research and manufacturing. As yet, there is no sign of the Government doing so. I ask the Minister: do the Government intend to provide a UK strategy for the manufacture of the next generation of electric batteries in the UK, and to increase support for the research and development of such technologies?

We need to grow our innovators, yet this is also threatened. For example, the Faraday Institution, which received flat funding until 2025, will not be able to recruit PhD students in 2023, as funding cannot be guaranteed beyond 2025. How are we to grow the next generation of innovators if we cannot recruit them because of lack of funding?

The Government can still meet their ambition to be a global hub of battery production by demonstrating a strong commitment to the research and manufacture of the next generation of batteries, and not risk losing our automotive industry.

I shall now move on. Our report also reported on the production of hydrogen. Soon after the publication of our report, which asked for a clear policy on hydrogen and fuel cells, the Government published their hydrogen strategy in August 2021. It stated the Government’s ambition to deliver blue hydrogen generation capacity of 5 gigawatts by 2030 and the first 1 gigawatt by 2024. More recently, the Government have increased this by committing to increase the capacity of hydrogen generation to 10 gigawatts by 2030. Will the Minister say how and where this is to be achieved, and in what timescale?

The UK’s current capacity for hydrogen production is way short of the Government’s ambition. None of the strategy refers to the development and production of fuel cells, a technology where UK excels, with several UK companies operating overseas but not in the UK.

There is a lack of clarity about the Government’s plans for the use of hydrogen for light and heavy goods vehicles, the development of infrastructure for the supply of hydrogen, and the use of hydrogen and fuel cells for domestic heating, and in the not too distant future there will be a need for a joined-up strategy on the use of hydrogen, ammonia and aviation fuels. When will the Government make these decisions and will there be a paper describing them?

The Government also need to address public concerns about the safety of batteries and hydrogen fuel cells and the regulatory changes needed to address this. What plans do the Government have to address these issues?

I have no doubt that other noble Lords will speak to many other issues that our report identified, including the need to expand vehicle charging points, address the skills gap and increase research funding for batteries and fuel cells.

If the Government are to deliver on their net-zero commitments, these issues need urgent attention. I will be surprised if someone does not ask about the implications of net-zero policies, given the current energy crisis and rising costs. The view of the committee was clear about the role that batteries and hydrogen fuel cells can play in delivering net-zero policies. The evidence presented to us was also clear that the Government need to do much more. All the evidence suggests that the Government have big ambitions and are doing something, but not enough. We need more action and commitment from government to give confidence to industry, investors and our research community. The Government’s ambition needs to be matched by their action. I beg to move.

--- Later in debate ---

[Lord Patel (CB)]

My Lords, I thank the Minister most sincerely for answering many of the questions raised, or at least for making an attempt to answer them. As he said, many remain unanswered, and I am glad that he has committed to writing to noble Lords.

When I listened to his answers, I came to the conclusion that everything the Government are doing is fantastic, and we should be world leaders in battery technology, battery science and so on. However, in reality it turns out that we are not. The question that I raised in the first place remains. The Government are doing something, but is it enough? I am glad that the Minister said he took note of the points raised and that the Government will think about it and see what action needs to be taken.

Having heard that response from the Minister, I hope the committee might in due course look at this again in a quick report to ask questions about how much is being done. For today, I thank all noble Lords who have taken part. It has been a very interesting and committed debate on the part of all noble Lords. I thank the Minister again in particular.

Motion agreed.

Newport Wafer Fab

Lord Patel Excerpts

Tuesday 22nd November 2022 Lords Chamber

[Lord Callanan (Con)]

The noble Lord will know that I cannot go into specific details of this case, but I am delighted to say that we have an extensive range of companies in the UK manufacturing and producing in this area. South Wales is one of the notable success stories with the catapult acceleration plans that we have there.

[Lord Patel (CB)]

My Lords, with the sale of a major semiconductor company of the United Kingdom and with no gigafactory for the manufacture of batteries, what effect will this have on our ability to manufacture electric vehicles?

Horizon Europe

Lord Patel Excerpts

Thursday 8th September 2022 Lords Chamber

[Lord Callanan (Con)]

I am not sure that it is second best; it is an alternative. We have many scientific co-operation programmes with many other parts of the world; the EU is not the be-all and end-all of scientific co-operation. However, we think that there is a lot of value in Horizon Europe, which is why we agreed that we should join up. Of course, we are prepared to pay all the associated costs. That was the agreement that we entered into and we want to try to join, but we have a plan B if that proves impossible.

[Lord Patel (CB)]

My Lords, for a change, I start by congratulating the Government for appointing one of the best candidates as CEO of ARIA—well done. One key issue of the Horizon Europe programme—apart from us becoming a full member, which should be our aim—is the collaborations we develop with other scientists worldwide. If we do not become part of Horizon Europe, there is no strategy in the plan B to increase collaboration internationally for our scientists.

[Lord Callanan (Con)]

I thank the noble Lord for his kind words about the CEO of ARIA and completely associate myself with them. He makes an important point: we have many collaborations with other scientists across the world. We think that this is very valuable and we want to build on it, but there are many scientific institutions in the EU with which we would also like to co-operate through association to Horizon. Of course, we will look at alternatives and will certainly work with alternatives in other parts of the world.

Horizon Europe

Lord Patel Excerpts

Thursday 7th July 2022 Lords Chamber

[Lord Callanan (Con)]

It is clearly a difficult political time at the moment but I have great faith in the institutions of this country. I am sure we will get through it and continue the excellent work that this Government have been doing on all those matters.

[Lord Patel (CB)]

My Lords, let us hope that we succeed with the remaining part of the Horizon Europe programme. I appreciate that the Government are committed to putting that same money back into research but can the noble Lord confirm that the money will go to research, which is where most of our Horizon Europe programme money goes, and not be earmarked for other purposes not regarded as research? While he is at it, can he update us on developments with ARIA?

[Lord Callanan (Con)]

I can indeed give the noble Lord that assurance. The money is a direct replacement and will go to research, but our preference remains to associate to Horizon Europe, if possible. With regard to ARIA, the noble Lord can expect some announcements on the chairman and chief executive fairly soon.

Catapults (Science and Technology Committee Report)

Lord Patel Excerpts

Thursday 19th May 2022 Lords Chamber

[Lord Patel (CB)]

My Lords, I am a minnow sandwiched between two competent and much more distinguished and knowledgeable speakers, the noble Lords, Lord Mair and Lord Willetts. Before I make my brief contribution, I thank the noble Lord, Lord Mair, for leading the debate and doing so comprehensively—in fact, so comprehensively that there is not much left to say. I will probably end up, as might happen to others too, emphasising what he has already said.

As the noble Lord was the key driver of the inquiry, it is appropriate for him to have led the debate and not me, just because I happened to be chairing the committee at the time. However, as the then chair, I thank all the committee members—many of whom are taking part today—for their contributions. As noble Lords know, much of the hard work of running the committee and producing the reports is done by the staff of the committee. I therefore join the noble Lord, Lord Mair, in thanking all our committee staff who he mentioned.

My brief comments are mostly related to chapter 4 of our report, which focused on the wider issues in relation to innovation, particularly those affecting the private sector, and the role that catapults can play in achieving the greater involvement of the private sector in the journey from research to innovation and commercialisation.

I would also like to link the evidence and references in our report to these issues to subsequent government policy in the innovation strategy, published in July 2021. The strategy, entitled UK Innovation Strategy: Leading the Future by Creating It, was the first report of its kind in 15 years, and it has high ambitions of making the UK a global hub for innovation by 2035. The report announces no new funding, but the hope is that government policies will lead to a greater involvement of businesses in investing in innovation. Certainly, the main focus of the report is on business. The report was widely welcomed even though there is more work to do, especially with regards to how the various components will be implemented. I think the report was widely accepted because the Government involved a wide range of institutions, including professional institutions, and businesses in developing it.

Our report called for developing greater involvement of business, academia and private investment in UK innovation and for simplifying the interface between UK research, innovation and business. Our report saw a major role for Innovate UK, and in particular the catapults, while the government report on innovation sees Innovate UK having greater powers and becoming the UK innovation agency—although it is not clear how—and is silent when it comes to the role of catapults, as the noble Lord, Lord Mair, briefly referred to.

Our report saw catapults as having a wider role, maybe even increasing their number in the area of government technology priorities. We saw an opportunity for the role of catapults to be expanded, perhaps even becoming the UK innovation agencies and bridging the interface between research, industry and business, rather like the Fraunhofer institutes in Germany. This is a model that would allow for academia to be part of the business community and for people in the institute and business to be part of academia, even to the point of innovation, and for agencies such as catapults to run their own research programmes in academic departments. So I ask the Minister: in the Government’s innovation strategy, what role do they see catapults having to implement the policy? With a change in their remit, catapults could also have an important role to play in the Government’s levelling-up agenda and ambitions, as the noble Lord, Lord Mair, already mentioned.

Our report emphasised the need to have a balanced view on competition as a driver of research and innovation. The representatives who gave evidence from the CBI commented that competition at all times is not a good idea for innovation. Our report asked that policies should make a co-operative model of innovation more possible. The Government’s innovation strategy gives the impression that a competition model is the one that they favour to encourage business to invest. It cannot be good, for example, for universities and catapults to compete for funds for innovation.

The inquiry’s report recommended longer-term funding for catapults and fewer reviews. The government response to both recommendations was, to put it generously, to pass the buck to UKRI and Innovate UK, and the subsequent government innovation strategy confirms that view. I am tempted to make the assumption that the Government are not clear what role catapults will have in the future, or maybe even that they see a different model to deliver their innovation strategy. I hope that the Minister will have some comments to make on that.

Finally, I make a plea. I feel that the innovation strategy is such an important part of the Government’s long-term R&D agenda and its implications for economic growth that the House should have an opportunity for a fuller debate on that strategy. I hope the Minister could be tempted to use his offices to persuade the business managers to facilitate this.

Horizon Europe

Lord Patel Excerpts

Wednesday 9th March 2022 Lords Chamber

[Lord Callanan (Con)]

The noble Lord makes a very good point. Of course, there is currently a dispute ongoing with Russia about the launch of the OneWeb satellite. My right honourable friend the Secretary of State is closely involved in this and is trying to unblock it as quickly as possible. But we will not be held to ransom.

[Lord Patel (CB)]

My Lords, accepting that the ideal scenario would be for the UK to be part of the Horizon Europe programme, we are, I understand, in a similar situation to Switzerland. In that respect, what plan or negotiation are the Government having with the Swiss research council to collaborate with it?

[Lord Callanan (Con)]

The noble Lord asks a very good question. I know that the Minister for Science has had productive discussions with the Swiss on that. They have an extremely good, advanced and able scientific programme, and we will be looking to step up our co-operation with Switzerland.

Net-zero Test for New Policies

Lord Patel Excerpts

Tuesday 11th January 2022 Lords Chamber

[Lord Patel (CB)]

My Lords, in respect of developing strategies for nature-based solutions, what advice are the Government developing to help farmers meet their responsibilities?

[Lord Callanan (Con)]

The noble Lord makes a good point. Emissions from agriculture and farm animals, et cetera, are a considerable component. These matters are of course addressed in the Environment Act, and there is no question that we are taking a whole-economy approach. Every sector needs to do its bit; food and farming production certainly need also to do their bit towards net zero.

Advanced Research and Invention Agency Bill

Lord Patel Excerpts

2nd reading
Tuesday 2nd November 2021 Lords Chamber

[Lord Patel (CB)]

My Lords, I start on a positive note: I am supportive of the establishment of ARIA. I wish its budget was bigger than it is. ARIA is modelled on the US agency DARPA, which has its focus on research and technology related to the military. DARPA’s success has built confidence among venture capitalists and angel investors, leveraging more funds above its core funding.

The strength of the UK’s research sector is its diversity of funding. Despite the belief of some, research councils in the UK have been very successful at funding discovery science. A good example is the MRC Laboratory of Molecular Biology in Cambridge, which has conducted high-risk, high-reward discovery research from its beginnings. What has been lacking is the freedom that research councils need to explore new ideas and take some risks. The governance structure of government R&D funding, with strong BEIS involvement, ties the research councils, Innovate UK and UKRI in bureaucratic knots, stifling research and innovation.

Having got that off my chest, I think the introduction of a new funding stream presents new opportunities. In being able to support projects that are high risk, it could help broaden and strengthen the UK’s research capabilities, allowing new sectors to emerge. The “I” in ARIA—invention—is good, because it offers an interesting and original creative opportunity. Grants for invention of technologies tend to do very badly in peer review in comparison with grants that aim to discover something. ARIA money explicitly to fund invention of technologies could be very powerful.

I now come to some of my concerns, which I hope the Minister might help allay. The Government have done a good job of framing the structure of ARIA, presented just now by the Minister, taking the best of the learning from DARPA and other US ARP agencies while accepting that some aspects need to be different in the United Kingdom. However, there is a need to better define and articulate the scope and objectives of ARIA, knowing that the agency’s impact will depend on its ability to do things differently. I hope the Minister will comment on this, too.

ARIA will fail if it is not allowed to do things differently. To this end, there is a need for a strong, non-traditional CEO, empowered to shape the operating model of ARIA and given the freedom to do so. Further, the agency’s autonomy and speed to action will require a governance model that protects it from day-to-day politics, encourages and allows it to be driven by greed for learning and progress and not be judged by failure, and ensures an appropriate level of funding over a reasonable length of time. For this and more, the agency needs a strong, respected, politically powerful chair who strongly backs the CEO and is single-minded with an objective of making ARIA a success. ARIA also needs a strong senior political figure who is prepared to bat for it and defend its autonomy and is willing to take the flack when there is bad news. Without this, ARIA will fail. Much of DARPA’s and other ARPAs’ success in the USA is down to the strong backing they get from the Secretaries of State in the relevant government departments. I ask the Minister to comment on the model of governance and on who the senior Minister responsible for ARIA will be. Will it be the Secretary of State for BEIS?

Researchers in the UK are keen to embrace new models of support that allow them to explore high-risk ideas. The opportunity to unlock latent potential in translational research in the UK is enormous. Currently, this is biased towards big industry, while individual scientists are increasingly interested in entrepreneurial models of translation. Such a model could rival US innovation models. To achieve this, more is needed than what is already proposed in the Bill. ARIA grants should waive the 20% cost sharing, which will be a barrier to high-risk research and translation. Can the Minister confirm that it is the intention to do so?

Current requirements for spin-out companies in the UK compared to those in the US are cumbersome, bureaucratic and costly. They stifle innovation and need to change. ARIA should be able to explore funding private and hybrid institutions for research, a highly successful model that DARPA has followed. DARPA’s and other ARPAs’ success in the United States is related also to US Government procurement policies that favour innovations developed by agencies. It is hard to envision ARIA’s success without a comprehensive public procurement strategy alongside. I hope the Minister can comment on that.

I end by wishing that ARIA is a success. If it is, it could be a model for more UK R&D funding.