Industrial Strategy

Lord Patel Excerpts

Wednesday 31st October 2018 Lords Chamber

[Lord Henley]

My Lords, as I have made clear, I am not in a position to give the list of all those who will be on the council, but I can be clear that it will be as representative as it is possible to be with 20 members; of course, with 20 members it is difficult to ensure that one covers every last corner of the kingdom. I look forward to being able to send a copy of the letter to the noble Baroness and to others, listing all members. As I have said, I look forward to doing that very shortly.

[Lord Patel (CB)]

My Lords, in their response to the Science and Technology Committee report, Life Sciences Industrial Strategy, the Government said they would be publishing the timelines with clear matrices to allow for independent scrutiny. When will this be published and who will be the independent scrutiniser?

[Lord Henley]

My Lords, the noble Lord has been scrutinising the industrial strategy, and particularly the parts of it relating to life sciences, ever since we published it, and we debated this only last week. He knows all about what we are doing on the life sciences part of it, and he knows the full membership of the life sciences innovation board and the Life Sciences Council. I look forward to sharing with him the membership of the Industrial Strategy Council when it is published.

Life Sciences Industrial Strategy (Science and Technology Committee Report)

Lord Patel Excerpts

Tuesday 23rd October 2018 Lords Chamber

Moved by

[Lord Patel]

That this House takes note of the Report from the Science and Technology Committee Life Sciences Industrial Strategy: Who’s driving the bus? (1st Report, HL Paper 115).

[Lord Patel (CB)]

My Lords, it is a privilege and a pleasure to open this debate on the Science and Technology Committee report, Life Sciences Industrial Strategy: Who’s Driving the Bus? The strapline is not intended to cause offence and I will explain its origins later. I begin with a sincere thank you to all who helped with the report: our specialist adviser, Professor Graeme Reid, professor of science and research policy at University College London; our clerk, Anna Murphy; our policy analyst, Dr Daniel Rathbone; and the committee assistant, Cerise Burnett-Stuart. I also thank all the hard-working committee Members who constantly attended the meetings and contributed. I thank the Francis Crick Institute, particularly Sir Paul Nurse, for arranging a visit to the institute and allowing us to use the place for evidence sessions. I thank the 127 people who sent in written evidence, amounting to hundreds of pages, and the 66 who gave oral evidence. I thank the Minister of State for BEIS, the noble Lord, Lord Henley, and the noble Lord, Lord O’Shaughnessy, from the Department of Health, for giving oral evidence. We were disappointed that neither the Secretary of State for BEIS nor the Secretary of State for Health and Social Care was available to give evidence, particularly as their role in driving the delivery of the strategy will be crucial, and because we do not get opportunities in the Lords to hear from Secretaries of State—certainly not in the Chamber.

Our report is a distillation of the views and evidence that we received—a genuine attempt to help inform the delivery of the life sciences industrial strategy and to make it a success. The UK’s life sciences sector is high-tech, research-intensive, scientifically diverse and innovative. It is a global leader. It contributes more than £30 billion per year to the economy and employs more than 480,000 people. It is because of this that this and previous Governments have recognised its importance. In January 2017, as part of the industrial strategy, the Government announced that they had asked Sir John Bell to produce a report on a strategy for life sciences. With this as a background, we launched our inquiry in July 2017. Sir John Bell published his report for the Government in August 2017; it was widely welcomed, including by us. It is comprehensive and thorough, with a long-term vision. It identifies the strengths and weaknesses in the system if the strategy is to be successful.

The Government published their sector deal in December 2017. Our report was published in April 2018 and the Government responded in a timely fashion in June 2018. The Government response, almost 28 pages long, is comprehensive and detailed, but it is not much of an approval of our recommendations. In fact, much of it showed disapproval—there was not much that they liked. I am pleased, however, that since then some of our messages and recommendations have been, or are being, progressed; perhaps the Government were simply shy at the time of responding to our report. I have no doubt that the Minister will have more to say—maybe he will accept some of our recommendations.

Our report covered five main areas: the challenges of implementing the strategy; the role of the NHS; the availability of finance for innovative companies, particularly those commercialising innovations; access to a skilled, trained workforce; and, lastly, scientific excellence. I will now briefly cover some of the issues that came up in these areas, and I have no doubt that others will pick up the details later.

Lack of a clear plan for implementing the strategy was a theme that came across over and over again. Evidence also highlighted the need for independent monitoring and scrutiny of the strategy. Without a clear implementation plan, it is difficult to see how the strategy can succeed. In the light of this evidence, we made several recommendations, including the establishment of a statutory body—the office for industrial strategy—to scrutinise, monitor and report regularly on how well the strategy is being implemented.

The Government did not think that this was a good idea and did not accept the recommendation. However, in their response they said that the life sciences industrial strategy board will,

“review the detailed … plan … with milestones, key metrics”,

clear lines of accountability and,

“a report on progress”.

As yet, there is no such implementation plan. Perhaps the Minister can answer my questions. When will this plan be published? How often will the board report? Will the report be published and will Parliament have an opportunity to discuss it?

While the Government did not find favour with our recommendation, I am pleased to note that they have appointed Mr Andy Haldane, chief economist at the Bank of England, to chair the Industrial Strategy Council, which will provide independent scrutiny and monitor performance. Will the Minister say how often it will report? Will these reports be published and in the public domain?

I am pleased too that there will be a representative from the Treasury on the board, which was one of the recommendations that we made.

Let me now briefly turn to the NHS and its role in the delivery of the life sciences industrial strategy. Much was said about the vital role the NHS will have to play if the strategy is to be successful, but many commented that it is currently unable to do this and questioned its ability to deliver. It is in this context that, when asked, Sir John Bell said:

“Whoever is driving the bus, the windscreen wipers do not work and the exhaust is falling off”.


That is why we included the strapline in the title: who is driving the bus?

In his evidence, the noble Lord, Lord O’Shaughnessy, said that,

“the NHS part is critical”,

to the strategy. One often-repeated comment was that the NHS is poor at adopting innovation and poor at being innovative. Acknowledging that, the noble Lord, Lord O’Shaughnessy, said that,

“one of the concerns is not that innovations cannot get a foothold but that they do not often get beyond that”.

I recognise that much progress has been made since our report, and in line with our proposals. Planning is going on, and the noble Lord, Lord O’Shaughnessy, is personally leading on that. That is good news. The NHS and Simon Stevens will now be represented on the implementation board, together with other senior managers. That is also something that we asked for and that we welcome. The government response says that a review is under way to simplify the innovation landscape under the NHS. My question to the Minister is: when will the outcome of the review be published, and will it be in the public domain? I understand that, as a BEIS Minister, he may not be able to answer that, but I hope that the question will be answered by the noble Lord, Lord O’Shaughnessy, in a written reply and be put in the Library.

Importantly, much was said about the NHS as the sole provider of healthcare in the UK. It has a huge amount of health-related data—data that is relevant for research and innovation. We as a country lead globally on that. However, while it is true that the NHS is data rich, much of the data is not collected in a standardised way, nor is it easy to access. That is a problem, but not a problem that cannot be solved. It can be solved by cleaning up the data. That will make the data enormously important for both research and innovation in the future. In their response, the Government made it clear that they have an important role in supporting the NHS to lay the foundations for maintaining a secure and trusted data environment that will support a flourishing data-driven health economy in the life sciences. The recent development of six or seven digital hubs based at the Wellcome Trust is welcome.

In the light of all that, the recent development whereby individual trusts are signing data-sharing arrangements with the private sector, with varying levels and terms of data access, has to be a concern. Individual trusts are making individual contracts which include terms of data exclusivity. I have experience of this and know that the same data can be used by several researchers for different reasons. If there is data exclusivity, other researchers will not be able to access it. My own feeling is that such a development has to be stopped now. It must be stopped until we are able to work out, after debate, who is the owner of NHS data, and who is the guardian of that data and decides who can use it. There is no suggestion that industry will not be able to use it, but the ownership is important. I hope the Minister will comment on that.

The recent Department of Health publication, The Future of Healthcare: Our Vision for Digital Data and Technology in Health and Care, is welcome. It is an extensive, well-rehearsed document. The NHS has a vital role to play in terms of data if we are going to develop the use of artificial intelligence for new drugs and diagnostics, in particular in the diagnosis of cancer. However, there is an important issue around who owns the data. By the way, we have in this House the chairman-designate of NHS England and the chairman of NHS Improvement, along with several board members of both of those institutions. It is a pity that we cannot hear what their views might be. However, I understand that they have difficult jobs to do and that they are busy people.

Let me touch briefly on the issue of a skilled and well-trained workforce. The UK’s strength in biomedical science has made us a destination of first choice for scientists at all grades and from all parts of the world. I could give the numbers, but rather than bore noble Lords with those, let me just say that, for instance, in the past some 50% of postdocs at the Wellcome Sanger Institute came from the EU. However, the percentage has now begun to decline. It is important that we maintain our ability to attract scientists from abroad for our strong science base. We heard how important it is to the science sector that it should be able to access talented and skilled people from around the world. It is good that the Government have acknowledged that in their response to our report. Whatever the outcome of Brexit, it is vital that universities, businesses and the NHS can recruit people with the necessary talent and skills both from within the EU and outside it. Without the ability to do this, the life sciences sector will suffer and the strategy will not succeed.

Given that, I am very concerned that the Migration Advisory Committee has recommended that after Brexit, the Government should extend the existing migration visa system for non-EEA nationals to EEA nationals. Sir Paul Nurse, director of the Francis Crick Institute, told us that the system is,

“expensive, tedious and it puts people off”.

We were also told that without a simple system for talented individuals to come to the UK, we will lose out to other countries and make it easier for people to move to them. Today’s report of a letter signed by 29 Nobel Prize winners from the UK and the EU to the Prime Minister and the President of the EU Commission suggests exactly that—that the EU-UK relationship in science must be maintained. The key reason is that in science, Europe is currently the only credible challenger to developments being made, particularly in biomedical science, in the USA and China. Europe alone or the UK alone may not be as strong. I hope that the Government will not agree with the report of the Migration Advisory Committee.

In the time I have to speak, I have not been able to cover the issues related to the need for finance, in particular for the development of innovations on to commercialisation. We have made some important recommendations and I know that in their response, the Government are in favour of some of them. However, it will be the Treasury that ultimately decides, particularly on the proposal for whether pension funds could be used for risk investment. I hope that other contributors to the debate will pick up on that point. Equally, I have not been able to cover the need for science excellence, which is an important issue, and I hope that some colleagues will deal with it.

Some of my questions clearly relate to the Department of Health and therefore a different Minister. I hope that I can receive a written response if the noble Lord, Lord Henley, is not able to answer all my points. In conclusion, I thank all those who have put their names down to speak in the debate and I look forward to hearing their contributions. I beg to move.

--- Later in debate ---

[Lord Patel]

My Lords, the time is late and this has been a long, but very useful, debate. I thank all noble Lords who have so enthusiastically taken part. There have been some excellent speeches. Debate on any report of a House of Lords committee should not be confined only to members of the committee. The rest of the Members the House should be able to take part, and the speeches we have heard show that other Members have been able to take part.

I do not want to be ungenerous to the Minister. I well understand that, in a long debate with lots of questions, he did not have time to absorb them and produce a response that we might find satisfactory. I am glad that he has committed himself and the noble Lord, Lord O’Shaughnessy, to take on board all the comments that were made and all the questions that were raised, and we look forward to a full response.

As we all want to support this strategy to be a success, we will no doubt come back to this. It may even be that the Science and Technology Committee may look at this again in a year’s time to see how the strategy is progressing. I thank all noble Lords.

Motion agreed.

Science and Innovation Strategy

Lord Patel Excerpts

Monday 23rd October 2017 Lords Chamber

Asked by

[Lord Patel]

To ask Her Majesty’s Government what plans they have for making their science and innovation strategy an effective part of their industrial strategy.

[Lord Patel (CB)]

My Lords, I assure you that the next debate is as interesting.

It is with great pleasure that I open this debate and thank all noble Lords, including the Minister, for taking part. On the speakers list are the names of extremely talented noble Lords with a great deal of experience in the area which we are to debate, and I look forward to their contribution. The subject of the debate is science, innovation and industrial strategy, reflecting on the Green Paper published in January 2017 entitled Building our Industrial Strategy, which identified 10 pillars of industrial strategy that will drive economic growth in the United Kingdom. I will touch briefly on each of the issues and make a few remarks about the latest publication on life sciences and industrial strategy.

The basis of the industrial strategy is, of course, the UK’s strength in science research. This is undoubtedly so. Our universities rank highly in the global league of top 100 universities. For the first time in 13 years, Oxford and Cambridge top the table, with four universities in the top 20 and 12 in the top 100. The Universities of Cambridge and Oxford score highly on research funding as a matrix, but they also rely heavily on—or rather, I should say, gain from—the research funding that comes on a competitive basis from the EU: in Cambridge’s case, it is about a quarter; in Oxford’s case, it is about a fifth.

In the life sciences sector, we have four universities in the top 20—and, similarly, the engineering and technology sector also has the top four universities in the UK. So, yes, we should be proud of our science lead. By the way, in the top 100 globally, we have 12 universities. Seven of them are in the south-east of England, two are in Scotland and only three are in the rest of England—the north of England. That might have implications for where the science funding goes.

When it comes to taking science to innovation, we do not have such a good story to tell. In world rankings for innovation, 51 of the top 100 universities are in the United States, 26 are in Europe and 20 are now in Asia. That is where the current threat of innovation is coming from: Korea, China, Japan and other developing countries. They are the new threats.

I am tempted to consider what a top innovative university looks like. In 1940, Stanford University was regarded as no more than a third-rate school of engineering. Currently, its alumni deliver $3 trillion a year to the economy and employ 5.4 million people. Of the 100 top innovative universities in Europe, the UK has 17, the same as France, while Germany has 23. Of the UK’s 17 universities, four are in Scotland. I am pleased to say that number five in the United Kingdom is the university of which I was Chancellor for 11 years—not any more—the University of Dundee.

All these figures show that we are good at turning money into ideas, but not so good at turning ideas into money. That is what we need to address. Therefore, does the Minister agree that we need to look at ways to support universities that are good at research to become innovative universities? Mr Jo Johnson, the Universities Minister, has suggested developing a knowledge exchange framework rather like the TEP and REF for teaching and research. Can the Minister say more: do the Government plan to do so?

I turn to the document, Building our Industrial Strategy. In 1960, we had the “white heat of technology”, which ended in the demise of the automotive industry and many others. Then we had market competition, in which government spent money on science and left the private sector to innovate. It was successful for a while, but when the financial crisis hit the economy in 2007 and 2008 we had another strategy: rename the department. We got the Department for Business, Innovation and Skills and a new slogan: “New Industry, New Jobs”. Intervention was then followed not by strategy but by an “industrial approach”. The financial crisis, economic stagnation and Brexit has now resulted in this document, Building our Industrial Strategy. It has been well received, shows government commitment and is visionary, with innovation at the heart of it—and succeed it must, because we have nothing else.

But there remain challenges, such as Brexit, with its impact on the economy and the skilled workforce and, of course, the effect of immigration policy. Then there are other challenges, including how to turn science into innovation, which I have already mentioned. The strategy is based on innovation but I see no goals in it for specific innovation, except in sector terms. Why should not there be specific goals of tech-based innovation linked to each of the 10 pillars?

The Government have committed to raise the spending on R&D from 1.7% of GDP to 3% of GDP, comparable to our competitors. Of course, our competitors also have strategies to raise their GDP and, by the time we meet the goal of 2027, if we do, of 3% of GDP, our competitors, particularly in the east, will have moved further along.

The Government have promised £4.7 billion of investment in science and innovation over the next four years and the Industrial Strategy Challenge Fund may act as a catalyst to leverage more R&D from the private sector. However, what evaluation have the Government made of previous policies to be confident that policies to leverage more R&D funding will be successful?

Another suggestion in the document is that the Government will start an institute for battery research, to add to the National Graphene Institute, the Francis Crick Institute, the Rosalind Franklin Institute, the Alan Turing Institute and the Henry Royce Institute. What will be the governance mechanism, how much of the institute will be committed to research as against innovation, and how will it be monitored?

I turn briefly to the report of the Government on the life sciences sector—the life sciences industrial strategy, recently published by Sir John Bell. I add that I am chairman of the Lords Science and Technology Committee, which is conducting the inquiry into the strategy and which will report in due course—no doubt constructively.

The report has been well received and widely welcomed. It is ambitious and identifies the need to increase the science offer; for a growth in infrastructure and an increasing skills base; for regulation to promote innovation; for immigration policies that align with the needs of the life sciences sector; and for the NHS to be both more adaptive to innovations and more innovative. I shall pick out two of those points, because they are connected. One key recommendation is the creation of the Health Advanced Research Programme, or HARP, to create two or three new global industries in the next 10 years, analogous to DARPA, an organisation linked to US defence, which has been highly successful. However, in that case, US defence was its key customer, which wanted to be assured that it could lead the world in defence globally. Is our NHS similarly placed? HARP needs the NHS and the social care system in the UK to be effective, affordable and appropriate to the changing demographic needs of the UK population, and to be recognised as a leader in the world. Do we have an NHS that can be quick to adapt and be innovative? Current evidence does not suggest that that is so.

The report also recommends greater government support for the charity research sector. That sector in biomedical science is extremely strong, but universities need the support of the Government. Do the Government agree with that? When will they respond to the sector report on life sciences, and when will it be implemented?

Life Sciences Industrial Strategy

Lord Patel Excerpts

Monday 23rd October 2017 Lords Chamber

[Lord Patel (CB)]

My Lords, one of the key proposals in John Bell’s report on the life sciences industrial strategy is the use of NHS data. What is the Government’s view of business, particularly global business, using NHS data?

[Lord Prior of Brampton]

NHS data is potentially a hugely valuable resource, with the huge proviso that we must always respect patient confidentiality and privacy. On that basis, the data that we have in the NHS from primary and secondary care, given that it is the biggest universal healthcare service in the world, could be of huge benefit in developing new drugs.

Industrial Strategy

Lord Patel Excerpts

Wednesday 19th July 2017 Lords Chamber

[Lord Prior of Brampton]

I thank the noble Lord. The shipbuilding strategy will be an important part of our overall industrial strategy, and of course it is not just about naval shipbuilding, it is about civil shipbuilding as well.

[Lord Patel (CB)]

My Lords, when do the Government intend to publish the life sciences industrial strategy? When it is published, will it be a definitive document with timelines over the next two, four, six and 10 years, or will it just be a wish list?

[Lord Prior of Brampton]

A strategy for life sciences is a critical part of our industrial strategy. It will be published imminently and certainly well before the industrial strategy is published in the autumn. It will not only set out a strategy for one year but look forward for at least 10 years.

Higher Education and Research Bill

Lord Patel Excerpts

Committee: 7th sitting (Hansard - continued): House of Lords
Monday 30th January 2017 Lords Chamber

Moved by

[Lord Patel]

489: Clause 87, page 55, line 38, at end insert—
“( ) In carrying out its functions under subsection (1), UKRI must recognise the autonomy of the Research Councils, their institutions and their partnerships and relationships, and the principle of subsidiarity in decision-making.”

[Lord Patel (CB)]

My Lords, the aim of Amendment 489 is to investigate and ask what autonomy the research councils will have when UKRI is the single voice for research. Although I accept that UKRI has a very important purpose in being that voice, it must allow the individual research councils to flourish in order to identify the most promising science and, through their institutes, deliver ground-breaking insight and understanding. My amendment seeks to ensure that UKRI can co-ordinate but does not in any way crush the expertise, independence and autonomy that created organisations such as the Laboratory of Molecular Biology in Cambridge, an institute of the MRC often referred to as the UK’s Nobel prize factory—I think at the last count for 15 scientists.

The executive chairs and management of the councils should be allowed to decide on scientific priorities and have the authority to run their organisations in an effective way, working within the strategic framework set by UKRI, but without having to defer to the UKRI board for operational or scientific issues. Research councils need a distinct identity, and the independence and agility that goes with it, to enable them to undertake procurement and form partnerships, joint ventures and collaborations without continuous recourse to the UKRI supervisory board. In mentioning the example of the Medical Research Council, I should have declared an interest in that I have been associated with the council for a long time and until recently was a council member.

The Medical Research Council has collaborated with AstraZeneca on drug development and Marks & Spencer on food security, as well as collaborating internationally in several cases. Research councils should have the right to retain returns from the exploitation of publicly generated IPR. Such IPR will continue to be both an important source of revenue and a valuable incentive to translate scientific developments into new products and devices. Individual research councils could be encouraged to develop IPR and be able to share in the economic benefits of exploiting them, recycling them back into science and research for the good of the nation.

Furthermore, internationally renowned brand identities, such as that of the MRC, should be retained. There is clear evidence that brand identities such as the Medical Research Council’s attract some of the very best scientists to the UK. Its reputation for rigour and excellence also leverages co-funding from other research funders, often in a ratio of 10:1 or more.

The current wording in the Bill that UKRI will arrange for councils to,

“exercise such functions … as UKRI may determine”,

does not seem to sit easily with the principles of subsidiarity, autonomy and independence of research council disciplines. There is a need for greater clarity as to how the autonomy of the research councils will be maintained. I beg to move.

[Lord Mendelsohn]

I shall speak to a couple of amendments that are worth addressing, but I associate myself with the proposals by the noble Lord, Lord Patel, which have a great deal of merit.

In Amendments 495J and 500ZA, we believe we are dealing with a drafting error that currently makes ineligible independent research organisations for financial support as well as a higher education provider. We think that that excludes museums and is probably a drafting mistake, so we would be very grateful to get some clarification from the Minister about whether museums would be incorporated.

One of my sons is a big fan of a TV programme called “The Big Bang Theory”, which is the story of some young people in America who in the main, as is the vogue of the time, are what you would consider to be “geeks”. The episodes start with the name of a scientific principle, theory or experiment, so prior to this debate my son believed that my interest in the Haldane principle was about “The Big Bang Theory” as opposed to the autonomy of research councils.

The Haldane principle is one that everyone holds dear. There has been a great deal of debate about whether a more explicit reference to it should be in the Bill, and I think there is a broad consensus towards that view. I hope the Minister considers the two amendments on that issue. I am not particularly prissy about the drafting but I am sure everyone in the research and science community would be very interested to have it confirmed by the Minister if that were something the Government were keen to do.

--- Later in debate ---

[Lord Prior of Brampton]

My Lords, I thank the noble Lord, Lord Patel, for a very thoughtful speech at the beginning of the debate. On Amendment 489, I want to make it clear that the Government agree that councils must be able to operate with autonomy and authority over decisions within their fields of activity. For that decision to be made, we must ensure that experts in their fields are involved in allocating grants. I can reassure the noble Lord, Lord Patel, that the objectives of his amendment are already achieved in the Bill.

The Bill ensures that UKRI cannot prevent any of the research councils carrying out their duties in their specialist areas by requiring UKRI to devolve its functions to the councils for these activities. This will give the councils the independence they need to pursue their research agendas while also being able to interact as part of UKRI. Furthermore, by bringing the councils together within UKRI, we introduce the opportunity for a strategic centre, but with responsibility to consider broader issues than any council can alone. This strategic focus is a feature that many noble Lords raised at Second Reading.

Amendment 503ZA examines the Secretary of State’s power of direction. Let me reassure noble Lords that powers of direction are rarely used, but given the very large sums of public money that UKRI will be accountable for—some £6 billion—it is proportionate. The Secretary of State currently has an equivalent power of direction over research councils, and our proposals are intended to mirror that. I can reassure noble Lords that the power will not be used day to day to steer UKRI’s operations, nor as an override to the Government’s long-term commitment to the Haldane principle. However, the Secretary of State must be able to deal swiftly with any financial issues arising, for example, from financial mismanagement.

Turning to Amendments 503A and 505C, I welcome the opportunity to restate the Government’s commitment to the Written Ministerial Statement on the Haldane principle made by my noble friend Lord Willetts in 2010 which will apply to all research funding allocated to UKRI. This Statement is carefully balanced and considers important, interrelated and sometimes conflicting factors. It is, however, a policy statement, not a legal document. Obtaining such a balance in legislation through a legal definition of Haldane is not a simple task. However I will reflect on the helpful comments made here today. I hope that noble Lords will accept that if we could write Haldane into the Bill in a non-equivocal and legal way, we would do so.

On dual support, the Bill sets out in legislation for the first time the dual support system for research referred to here as balanced funding. I hope this clarifies any potential misunderstandings about the relationship between the two. Some noble Lords have asked, not unreasonably, why a different description is used. It is because the protection of the two funding streams and the balance between them are both important, and both must be carefully considered by the Secretary of State when making grants to UKRI. I agree with noble Lords that the nature of dual support is anchored in the complementary allocation and evaluation mechanisms of the two funding streams. Amendment 505ZA would replace the need for the Secretary of State to consider both halves of the dual support with a need to consider only one part—the block grant.

Let me reassure noble Lords that Clauses 95 and 96 already put considerable conditions on the Secretary of State’s powers which protect the unhypothecated nature of quality-related funding and ensure that this will continue through Research England. These restrictions are consistent with Section 68 of the Further and Higher Education Act 1992. They protect academic freedom by ensuring that terms and conditions of grants cannot be framed in terms of particular courses of study, programmes of research, appointment of academic staff or admission of students.

The system of dual support sustains a dynamic balance between research that is strategically relevant and internationally peer reviewed, and research that is directed from within institutions. However, the precise modes of operation of the two streams have changed over time, for example through the evolution of the RAE into the REF. Similarly, we should not try to permanently fix what the balance should be between the two parts of dual support. Funding flows are dynamic, and there is no formula or set proportion for the balance of funding across the two parts of dual support. When considering what the balance of funding should be, as now, the Secretary of State will take advice from UKRI and consider issues such as the strategic priorities of the research base and the sustainability of higher education, research capability, and other research facilities supported through the UKRI budget.

I turn to the proposal in Amendment 495J, tabled by the noble Lord, Lord Mendelsohn, that the remit of Research England be extended to cover independent research organisations. At present, research councils accredit organisations to compete for funding if they possess the capacity to carry out research that enhances the national research base. These organisations include hospitals, museums and other public sector research establishments. Those organisations currently receive their underpinning capability funding, similar to the QR block grant from other parts of Government, and there are no plans to change this arrangement.

This debate has covered some of the most fundamental matters about how we undertake research in the UK. I have listened very carefully, seeking to draw on the experience here in this House. With the hope of further constructive dialogue, I ask the noble Lord, Lord Patel, to withdraw his amendment.

[Lord Patel]

My Lords, I thank the Minister for his comments. I was encouraged by his reassurances about maintaining the autonomy of research councils. Putting that on record is satisfactory to me. I am grateful to other noble Lords, and I hope that they have found that their amendments were responded to. On that basis, I beg leave to withdraw the amendment.

Amendment 489 withdrawn.

Higher Education and Research Bill

Lord Patel Excerpts

Committee: 7th sitting (Hansard): House of Lords
Monday 30th January 2017 Lords Chamber

[The Earl of Selborne]

My Lords, I support the thrust of these amendments and I am sure that everyone would wish to acknowledge the enormous contribution made by organisations such as the Wellcome Trust and Cancer Research UK, to name two of the largest. The noble Lord, Lord Willis, gave us the figures of just how big their contribution is at £1.2 billion from those two alone, while the sector as a whole contributes something like £1.6 billion, which is an enormous sum.

UKRI is to be the very much desired champion of research and to attract not only the interest of the Treasury but of the business and wider community, and it must therefore be totally conversant with all aspects of our research portfolio. That will include not only the large charities to which I have just referred but the smaller ones working in different fields such as the environment and nutrition. Also, we should not be too hard on the business community. Let us remember that it spends more on research than academia, something like 70%. Where we are failing at the moment is in the application of research.

We know that our science base is absolutely excellent and business will always depend on it. It should be nurtured and if anything we must increase its funding, and we therefore warmly welcome the fact that £2 billion will have been secured by the end of this Parliament. But it will not all go to academia because it has to be spread around the entire research portfolio in the country, which means that Innovate UK will be able to help bring the science base and industry together in a more purposeful way to the advantage of jobs, regional employment and much else. If we are to have a successful knowledge economy, as the industrial strategy White Paper pointed out, it will be through the successful implementation of large parts of this Bill. So I welcome the reminder that the charitable sector is an extremely important component. I am sure that when the composition of the UKRI membership is undertaken, difficult task though that may be, the charitable sector will have to be represented.

[Lord Patel (CB)]

My Lords, I rise briefly to support the amendment moved by the noble Lord, Lord Willis of Knaresborough, and spoken to by the noble and learned Lord, Lord Mackay of Clashfern, who covered extensively the reason why it is necessary for the charity sector to be represented on the board of UKRI. My experience during my time serving on the Medical Research Council showed that collaborations between the three major medical research charities, the Wellcome Trust, Cancer Research UK and the British Heart Foundation, made an enormous contribution. It would be rather odd if the medical research charities are not represented on a body whose job is going to be that of co-ordinating research in the entire sector across the United Kingdom. It is imperative that they should be represented, and I think that UKRI will gain from that. Again, I support the amendment.

[Baroness Morgan of Drefelin (CB)]

My Lords, I start by declaring my interests as the chief executive of a medical research charity and as chair of the National Cancer Research Institute. I support the thrust of the amendments in this group because I feel strongly that the contribution made by the charitable sector to medical research should not be thought of as being merely a business or entrepreneurial approach or that of the “charity sector”. It is a great source of innovation and partnership. The National Cancer Research Institute is an excellent example of that kind of partnership because it brings together not only all the leading funders of cancer research in the UK including the Department of Health, the devolved Administrations, industry representatives and the leading charities which have already been referred to such as the Wellcome Trust and Cancer Research UK, but also patients. The institute brings patients into the partnership, and of course the research councils are active partners to the institute. So I would echo the questions put by the noble Lord, Lord Sharkey, about the ability of the research councils to continue to form these productive partnerships in the interests of patients.

It is absolutely essential that the expertise of the charity sector is integrated with UKRI at the highest level and that we enable the funding councils to continue to work in these successful partnerships as they have been doing so far.

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[Lord Mackay of Clashfern]

I think it is reasonably clear that the research councils will cease to exist as bodies. They will become committees of UKRI. Therefore, it will be impossible for them to form any kind of partnership. What will happen, I assume, is that UKRI will form partnerships, perhaps resembling the partnerships that were there before, but there will be no question of the research councils having any right to form partnerships of any sort whatever. UKRI will have to do all of that.

[Lord Patel]

Perhaps I might expand on that. I had always assumed that the research councils will be able to form partnerships. If what the noble and learned Lord, Lord Mackay of Clashfern, just said is true, the Minister needs to emphasise that because it changes the whole working relationship between the research councils and UKRI.

[Baroness Neville-Jones]

Could there not be a delegated authority to do this?

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Moved by

[Lord Patel]

476: Schedule 9, page 100, line 39, at end insert—
“the higher education sector of England, Scotland, Wales and Northern Ireland.”

[Lord Patel]

My Lords, before I speak to the amendments listed under my name, I declare some interests. I am currently the chancellor of and a professor at the University of Dundee. Because of what I am about to say about my amendments, I make it clear that I am a graduate of the University of St Andrews—as is, I know, the noble Viscount, Lord Younger of Leckie. I am also associated with higher educational institutes in England and have previously been associated with the Medical Research Council and other research charities. In speaking to my amendments, I express my gratitude to those who have added their names to them; I look forward to hearing from them. I also hope that somebody on the government Bench will join in the discussion, but we will see. In speaking to my Amendment 476, I will also speak to Amendments 482, 486, 501, 502, 504 and 507.

It would be wrong to assume that my amendments are special pleading for Scotland’s higher education institutions and their research arrangements. They are not; they are intended to fill a gap in the Bill, which does not recognise that while the business of UKRI and Innovate UK will be UK-wide, other areas of its business, such as Research England, do not pertain to Scotland. Some form of arrangement needs to be put in the Bill to make sure that this is dealt with. Scotland’s universities are a core part of the United Kingdom’s strength as a world force in research and innovation. Their contribution will be essential to the success of UKRI; likewise, UKRI needs to be set up in a way that fully supports the success of Scotland’s universities. The Bill as drafted does not do this.

My concerns are in common with those of other devolved jurisdictions and their universities. Importantly, the amendments are also supported on a cross-party basis by the Scottish Parliament. This was expressed in a letter written in December from the convener of the Scottish Parliament’s Education and Skills Committee to the Speaker of the House of Commons, and subsequently to the Speaker of your Lordships’ House. It should of course have been sent to the noble Viscount, Lord Younger of Leckie. I hope this House will give appropriate weight to the views of the Scottish Parliament.

As the incoming chair of the UKRI, Sir John Kingman has offered personal assurances that it will operate for the benefit of the whole UK. Such assurances have also been given by the Minister of State for Universities and Science. Good as that is, the Government still need to go further and recognise in the Bill certain arrangements, which I will come to. My amendments are intended to achieve this. They would require UKRI to work in the interests of the whole UK and to give proper attention to the interests of the devolved jurisdictions. They would create an in my view necessary financial firewall between UKRI’s UK-wide functions and its England-only functions, in a way that is consistent with the Bill’s overall policy.

Amendment 476 would therefore require the Secretary of State to have regard to the desirability of appointing UKRI members with experience across the devolved jurisdictions. Of course, I welcome the Government’s Commons amendment requiring the Secretary of State, in appointing UKRI members, to have regard to the desirability of including at least one person with relevant experience in relation to Wales, Scotland or Northern Ireland. I believe that the importance of UKRI to the devolved jurisdictions is such that the Secretary of State should have regard to the appointment of members with experience of all the devolved jurisdictions. The increasing divergence of policy between the UK Government and the various devolved jurisdictions makes it important that the people appointed to UKRI have diverse insights and experience across the constituent jurisdictions of the United Kingdom, to enable UKRI to maintain a cross-border research ecosystem that is responsive to that divergence.

Amendment 482 would apply the same principles as Amendment 476 in seeking the appointment of experts from across the UK to individual research councils. This is important so that priorities set at the research council level and individual research project decisions are informed by knowledge of the capacities that exist across the UK. This is no different from what happens now: the research councils take cognisance of institutions in Scotland, Northern Ireland and Wales in their research.

Amendment 486 requires UKRI to exercise its functions for the benefit of each part of the United Kingdom. The research councils have a strong record of support for Scottish research, and on the basis of competitive excellence, Scottish universities win around 14% of funding. In 2014-15, some £260 million in research grants was won by Scottish higher education institutions. Scotland fares much less well, however, in the research councils’ decisions about where to locate national facilities. For instance, the Science and Technology Facilities Council’s only national centre in Scotland is the UK Astronomy Technology Centre in Edinburgh. Scotland receives only 6.8% of research councils’ investment in national facilities. So Scotland punches way above its weight in research grants, but not when it comes to the placing of research councils’ facilities.

There are risks that the Bill as introduced will create a UKRI which is responsive principally to a Secretary of State whose role’s principal focus is England. There are perceived risks arising from the integration of Research England into UKRI. That is the important point: UKRI has duties regarding research and also regarding Research England. UKRI will work most closely with institutions in England, the drawback being that it will naturally focus on institutions in England alone.

There is also the structural risk that UK-wide funding for research councils may be diverted into the England-only activities of Research England. Amendment 501 requires the Secretary of State to consult the devolved Administrations before approving UKRI’s research and innovation strategy. Currently, the Bill does not ask that that be done. This amendment protects the integrity of the UK-wide research and innovation ecosystem by ensuring that the UK Government consult the devolved Administrations before deciding whether to approve or modify a research and innovation strategy proposed by UKRI. This is important because the devolved Administrations are major players in the research and innovation ecosystem, so any UK-wide strategy must be the subject of co-development with the devolved Administrations. For instance, in Scotland, research endeavour is supported by the Scottish Government in several areas to the tune of hundreds of millions of pounds as part of the dual-support model.

On innovation, the devolved jurisdictions have their own economic policies and economic development agencies, and it is important that any innovation strategy developed by UKRI take full account of these policies. For these reasons, it is essential that a UKRI research and innovation strategy be considered by the devolved Administrations and that the UK Government have regard to their views before deciding whether to approve or modify such a proposed strategy. I believe that the Government need to make an explicit and binding commitment that the devolved Administrations will be consulted about UKRI’s research and innovation strategy.

Amendment 502 would create a strong mechanism to protect the separateness of UK-wide and England-only resources within UKRI. It would also ensure that Innovate UK has a separate budget that it can rely on for its own distinctive mission. A key value of the research councils as constituted is that they provide UK-wide research project funding, currently worth around £2.6 billion per year, to institutions across the UK simply on the basis of the excellence of their proposals. This is at the heart of what makes the UK a disproportionately successful nation in research, second only to the United States, which has far greater resources.

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[Lord Patel]

My Lords, I thank the noble Lords who supported my amendments, or at least discussed them. I will borrow the Minister’s words and say that I will reflect on his answers to see how much of a reassurance he has given. As for the application invitation that the noble and learned Lord, Lord Mackay, was handed by the department, an invitation is not the same as a requirement, and it can be interpreted in different ways. None the less, I was interested to hear about that. On that basis, for the time being, I beg leave to withdraw the amendment.

Amendment 476 withdrawn.