Science and Technology: Economy

Lord Willetts Excerpts

Thursday 31st October 2024 Lords Chamber

[Lord Willetts (Con)]

Quite right. My Lords, I congratulate the noble Baroness, Lady Freeman, on her excellent maiden speech; we look forward to many more of her interventions in the House. I also congratulate the noble Viscount, Lord Stansgate, for such an excellent opening to the debate, displaying his typical enthusiasm and making a subtle case for the hereditary principle.

I should declare my interests, particularly as chair of the UK Space Agency. I am also a member of this club of former Science Ministers, which has been referred to several times. It is great to see the noble Lord, Lord Drayson, in his place; we look forward to his speech. There is a very crude view of the role of the Science Minister: to extract money from the Treasury. I am sure that the noble Lord, Lord Vallance, has a much higher and more strategic view of his role than that, but he nevertheless did very well this week and I join those congratulating him on seeing off what looked like a significant threat.

I congratulate the noble Lord also on the speed with which the funding for science announced yesterday is already moving. There was an announcement of £520 million for the life sciences innovative manufacturing fund; it was up on the Government’s website by midnight, with the first round of applications for grants now open, with a deadline of 30 November. That is an excellent example of moving vigorously in an innovative environment. I hope, in that spirit, that the Minister will commit that the Government will indeed be implementing my proposals on improving the business case process so that it is similarly efficient and fast-moving, rather than cumbersome and bulky. We must not be complacent, however. There are of course challenges to face in the CSR, and we wish the Minister the best on that.

I would like very briefly to put three specific points to the Minister. First, cell and gene therapies are a great British scientific and technological success. However, they are suffering from the very uncertain VAT regime for cell and gene therapies sold to the NHS. HMRC defined these therapies as “work on goods”, apparently on the argument that the cells start from the human body and are eventually returned to the patient’s body and, in the meantime, they have just had a service, rather like a car going into a garage. In some cases, VAT is charged at 20%, which, in turn, affects the NICE calculations of the cost-benefit ratio in these treatments. Sometimes they are exempt. The best way forward would be for all these treatments to be clearly zero-rated and treated consistently.

My second point, if the Minister is able to comment, is that yesterday we also heard in the Statement from the Chancellor very good news on investment in the railway link between Oxford and Cambridge. Progress is gradually being made in the recreation of the old Varsity line, although it is a pity that there is a large housing estate somewhere between Bedford and Cambridge on the route of the original line.

Can the Minister confirm that, with this investment in transport, there will also be a recognition of the value of the Oxford-Cambridge supercluster and an attempt, alongside the claims of many other parts of the UK, to recognise and support that?

Finally, if he were here, I think the noble Lord, Lord Knight, would make an important point about investing in science teaching. The Government make a lot of the 6,500 new teachers. It is equally important and, in some ways, more cost-effective to invest in upskilling and retaining the teachers we have already have. Improving CPD for science teachers, so that they remain up to date, would be of great value.

King’s Speech

Lord Willetts Excerpts

Tuesday 14th November 2023 Lords Chamber

[Lord Willetts (Con)]

My Lords, I begin by congratulating the right reverend Prelate the Bishop of Newcastle on her excellent maiden speech. We look forward to her future contributions to our debates in this House, and I think her powerful speech today was part of a Newcastle theme that is already running through this debate. The right reverend Prelate spoke of her commitment to that city. We heard from the noble Lord, Lord Knight, about the great Sir Jony Ive, who of course studied design at what is now Northumbria University in Newcastle. At the University of Newcastle itself, the Centre for Life is an excellent example of both advances in medical research and applying it to healthcare locally. It was wonderful to have her intervention in this debate.

I begin by drawing the House’s attention to my entry in the register of interests, particularly my role, until last week, on the board of UKRI, my position as chair of the UK Space Agency, and serving on the board of Tekcapital and Darktrace.

I welcome the gracious Speech and the Government’s clear and strong commitment to science and tech. We saw it in the creation of DSIT and the very significant AI summit the other week, and we see it in some of the science and tech proposals in the gracious Speech. I will briefly comment on three or four aspects of that: first, regulation. In the very powerful intervention from my noble friend Lady Stowell, we were reminded that these are deep waters. There are tricky issues in regulation. First, if we get regulation right, we can use it to promote innovation and new technologies. I am aware, as chair of the UK Space Agency, that one of our key advantages in the race for launch from various sites in Europe is that we have space-launch regulations in place, carefully scrutinised in your Lordships’ House a few years ago. Having that regulatory regime gives us an advantage. The Human Fertilisation and Embryology Act provides a shared framework for life sciences innovation, and I very much hope that the Automated Vehicles Bill, for example, is another case where getting the regulatory regime right for a new technology can help to promote it.

Indeed, the Government did have an initiative, a pioneer fund, to help promote new regulation in areas which required it. It would be very good to hear from the Minister in the wind-up that there is a continuing commitment to that initiative. We must get the balance right; sometimes regulation can be overdone. I welcome the Data Protection and Digital Information Bill, which may protect the privacy of personal data without being as clunky as some other regimes, such as in the EU.

However, we do not need to regulate everything all the time. Sometimes, we get ourselves into a position where, every time there is a new technology, we feel we need to have a specific set of regulations for it because otherwise it will just operate in a lawless, anarchic world. National, general legislation already exists. It is already a crime to try to create a bioterror weapon, so we do not need to ask, “As people may use AI to create it, what shall we do to legislate against it?” There is a lot of law protecting copyright and privacy and stopping theft and people from developing instruments for the purposes of warlike acts or acts of terrorism. We should remind ourselves that, within that framework, new technologies are always and automatically covered. It would be dangerous if we got into the assumption that, every time there is a new technology, we need somehow to construct a legal regime, otherwise there will be anarchy out there—there will not be.

I was involved in a report from Onward, which the noble Lord, Lord Patel, referred to. He referred to its criticism of Treasury controls. I must warn him that, when he made that remark, I saw a shadow pass across the face of the noble Lord, Lord Macpherson, a former Permanent Secretary in the Treasury, who may have thought that Treasury controls are one of the few things standing between us and national bankruptcy.

I will expand a little on what that report meant by “Treasury controls”. Of course, there have to be decisions about the total amount of public expenditure and it has to be allocated to departments, including the new Department for Science, Innovation and Technology. Governments have to be able to decide their public expenditure totals and then be disciplined in sticking to them. However, a lot of controls around spending are designed, particularly with processes such as procurement and business case rules, for what one might regard as conventional procurement, such as building a bypass or constructing some national infrastructure. They can stand in the way of a proper use of an innovation budget.

When you talk about how the US promotes innovation, you find, for example, that it uses procurement. I have been at conferences in the US, where I have asked some new inventor how he is funding his project. He said, “I have already sold the first 10,000 to the Department of Defense”, even though he has only a prototype and not yet produced any. That is contrary to our procurement rules. Even when we try to promote innovation, we are not allowed to pay for anything until the service has been delivered. However, innovative use of procurement is a powerful means, if used carefully and within an overall spending commitment to make things happen.

Similarly, business cases are necessary if you are doing a standard project, but they can sometimes be extraordinarily time-consuming when the Government are deliberately bearing risk. The target is therefore not risk reduction, as it should be when you are building a bypass. In the Department for Science, Innovation and Technology, the Government are bearing risk. Indeed, in this case—speaking as a Conservative—the reason why the Government are involved is not because they have perfect knowledge of what will happen in every area of science and technology, but because it is the legitimate role of government to bear risk. So I believe that the proposals in our report from Onward were of merit, and I hope that they were consistent with the Treasury disciplines in which all of us on this side of the House believe.