(7 years, 1 month ago)
Lords ChamberMy Lords, I too congratulate the noble Lord, Lord Patel, on securing this debate and on his introduction, which was as excellent as always. He has of course highlighted both the opportunities that arise from the science and innovation and industrial strategies, and the challenge of realising their potential. Like many in your Lordships’ House, I suspect, I was somewhat impressed by the success of Stanford, where the synergy between research and innovation is seamless, focused, well-financed and taken as part of an innovation ecosystem that delivers commercial, health and societal benefits on a massive scale. However, while we can admire what is being achieved at Stanford, Caltech or MIT, trying to replicate their models may prove somewhat challenging, so perhaps we should look at how we can utilise the UK’s own unique strengths to power our own innovation revolution.
We can argue about whether the government strategies are right, but my question is: do we have the infrastructure and, more importantly, the people to power an innovation revolution in the UK? Arguably, the setting up of UKRI was a significant response to this challenge, bringing together under one roof both the traditional research councils and the relatively new Innovation UK. On his appointment to UKRI as chief executive, Sir Mark Walport wrote a letter to all partner organisations—including NERC; I declare an interest as a council member. In his letter he stated:
“Our research and innovation landscape and funding system is world-leading”.
I do not often question Sir Mark, but although he is absolutely right to declare our research base as world-leading—a claim evidenced by the fact that we have four HEIs in the top 20 universities in the world—the global league tables for innovation tell a different story. Despite having a concentration of seven research universities in London and the south-east, our top entry for innovation is at number 13, with few HEIs in the top 100. We are good at research; we are not as good at innovation.
On funding, while UKRI has a £6 billion a year budget for research and innovation and the Chancellor has found a further £2 billion a year to support the industrial challenge strategy, such sums pale in comparison with the United States or China, which spend a significantly higher percentage of GDP on innovation—as do Germany, France and Japan. Indeed, as the noble Lord, Lord Freeman, hinted at in his excellent contribution, this lack of access to capital helps to explain why it is notoriously difficult in the UK to grow our research ideas beyond proof of concept without seeking finance from nations with deeper pockets and less aversion to risk.
However, my principal concern is the gap between research and innovation, and in particular the divide between individuals working in those two communities—that is, scientists and entrepreneurs. It is as though they have a different DNA. What we expect from each group is different and that is a very real challenge for UKRI, which must not say that it is “business as usual” for the traditional seven research councils.
The vision of and for those scientists funded by our research councils must change, and it must change significantly. My own council, the NERC, is 50 years old this year and, although environmental science has grown exponentially in that time and our scientists have made huge discoveries—from the hole in the ozone layer to the disastrous effects on health of sulphur dioxide from coal-powered stations, climate prediction and so on—only relatively recently as a council did we develop an industrial strategy looking at how the NERC science can help find innovative solutions to environmental challenges.
However, as Professor Duncan Wingham, the executive chair elect of the NERC, said at a recent council meeting and in this House last week, for too long our scientists have brought to Ministers a detailed understanding of environmental problems but have not felt empowered to take their research further to offer solutions or to see whether they have commercial or societal benefits, or perhaps have not felt that this was wanted. That is not surprising. Our seven research councils, in addition to funding research in most of the UK’s research universities, support some 18 research institutes, 32 research centres and a plethora of more localised facilities and units. If there is a new discovery, we have a new centre.
Their emphasis is on either research to support national capability or discovery science; it is not on innovation. Perhaps Professor Wingham was not questioning the value of this research—he most certainly was not—but in fact offering a challenge to all the research councils in the new landscape of UKRI not to populate the innovation space with a separate cadre of scientists or entrepreneurs but to encourage existing scientists and research leaders to take their thinking to the next level, which inevitably means working with other disciplines, using the totality of our rich research base to lead innovation and to be part of the solution, not simply asking someone else to find the solution.
If the UK is to deliver on both the science and innovation strategy and the industrial strategy, an early drive by UKRI to redefine the mission for our research communities and the people who work in them is absolutely crucial.
(7 years, 9 months ago)
Lords ChamberMy Lords, I shall also speak to Amendments 478 and 479 in the names of my noble friend Lord Sharkey and the noble Lord, Lord Stevenson of Balmacara, and to Amendment 475, to which the noble Lord, Lord Mendelsohn, has added his name. I also strongly support Amendments 486A and 491 in the names of the noble Lord, Lord Mendelsohn, and my noble friend Lord Sharkey respectively.
Having not had an opportunity to speak at Second Reading as I was attending NERC’s council meeting in Lancaster, I should for the record declare my interests. I am currently a council member for the Natural Environment Research Council, chairman of the NIHR Collaboration for Leadership in Applied Health Research and Care in Yorkshire and Humber, a member of the Court of Birmingham University, a council member of the Foundation for Science and Technology and a consultant for HEE. I am designing a new doctoral training centre for advanced nursing, and, until 2016, I was chair of the Association of Medical Research Charities—hence my interest in these amendments.
In proposing Amendment 474, I should say that I am strongly in favour of the Government’s direction of travel with regard to the establishment of UKRI. I believe that the current system certainly needs change. Frankly, the notion that royal charter status gives freedom and flexibility to the decision-making of the research councils is fanciful. In many cases, decisions are made not by the research councils but by BIS, as it was, and BEIS, as it now is, and more regularly by the Treasury. Even with the support of committed former Ministers such as the noble Lord, Lord Willetts, who is in his place, it has at times been painful for my research council to change the governance structure of our institutes to meet challenging demands or respond to commercial requirements. However, to realise the potential of UKRI and the new research councils to be one of the most innovative and exciting research organisations in the world requires a membership which is able to think and act entrepreneurially in the interests of science, the economy and society.
Few sectors have the pressure to succeed more than the charitable research sector, whose direct interface with its millions of contributors makes it a powerful ally in research but whose support is needed on a regular basis to stay in business. What is more, while much of discovery science requires taxpayers’ money, the charitable sector is a major net contributor. The Association of Medical Research Charities, which covers most of the investors in medical research, contributed an impressive £1.3 billion in 2013, the same amount in 2014 and, in 2015, £1.43 billion. Its contribution over the length of this Parliament will top £6.5 billion.
While the Wellcome Trust, CRUK and the British Heart Foundation are the principal contributors, this sector is unrivalled anywhere in the world in its contribution to medical research. That was emphasised in the Nurse review, when Sir Paul said:
“To facilitate such interactions and to ensure that proper knowledge and understanding of the entire UK research endeavour is maintained, I recommend particular care is paid to ensuring there are strong interactions between the charitable research sector and the Research Councils”.
These amendments simply attempt to put what Sir Paul said in his report into action. They try to deliver “strong interactions” exactly where they should be—not simply on the boards of the research councils but on the board of UKRI itself.
Amendment 474 seeks that experience of the charitable sector should be an equally desirable quantity as industrial, commercial or financial experience, so drawing from the rich experience of the community. Amendment 475 seeks as desirable experience of the,
“funding of research from the charitable sector”.
Given the enormous contributions made by this sector, that seems entirely appropriate. Amendment 478 goes one step further, stating that:
“The Secretary of State must”,
include one person with,
“relevant experience in the charitable research sector”.
Who knows, perhaps even Sir Mark Walport or Jeremy Farrar, the past and current chief executives of the Wellcome Trust, might be thought worthy, or perhaps Peter Gray, the joint managing partner of Wellcome investments, who successfully manages its £20 billion portfolio? Amendment 479 would insert,
“research involving the charitable sector”,
as relevant experience for contributing to UKRI. There will be no shortage of candidates to join UKRI, but the charitable research sector must not be ignored.
My Lords, I will speak to Amendments 475 and 491 in this group. I declare an interest as the current chair of the Association of Medical Research Charities. The first four amendments in this group, including Amendment 475, all deal with a rather striking omission from this Bill. As far as I can tell, there is no mention at all in the Bill of the contribution of the charitable sector to UK research and no provision made for the representation of the sector anywhere. My noble friend Lord Willis has made the case forcefully and clearly for rectifying that omission.
My direct experience is with medical research charities. As my noble friend Lord Willis has just pointed out, last year these charities spent over £1.4 billion on medical research, 93% of which was through UK universities. That was a greater amount than was spent by either the MRC or the NIHR. Medical charity funding is vital to our standing and success in medical research. The UK is a world leader in this area, in part because of charitable funding. Medical charities also provide an unrivalled point of contact with patients, and I know the Government will agree that the patient voice should be represented in discussions about research funding and direction.
I acknowledge that the Government are aware of the importance of the charity research sector and have taken important steps to rectify its omission from the Bill. For example, as the Minister said, they have listed “charity research experience” among the desiderata in the recently published recruitment ad for UKRI members. That is a good thing, but it is not a substitute for having charitable research in its proper place in the Bill. That is what Amendment 475 does. It adds a further category—
“funding of research from the charitable sector”—
to the list of experience that, between them, the members of UKRI must have.
Amendment 491 in my name and that of my noble friend Lord Willis and the noble Lord, Lord Stevenson, deals with the research councils, rather than with UKRI. As things stand, research councils can enter into joint funding partnerships with other bodies, and they very frequently do this. For example, I believe that around 40% of current MRC expenditure on research is in such partnerships. I am sure the Minister will agree that such partnerships are not only to be encouraged but are a well-established and vital way of doing business for the research councils. Amendment 491 is, essentially, a probing amendment. Its purpose is to seek reassurance from the Government, on the record, that after UKRI is established, the subsidiary research councils will still be as free as they are now to form such partnerships. I raised this issue in a recent meeting with the chair of UKRI, Sir John Kingman. He kindly wrote to me after the meeting, saying, “Let me also be clear that whilst legal agreements will be with UKRI, I fully recognise the importance, for example, of MRC being able to continue the rich partnerships they enjoy with medical research charities. The individual councils of UKRI will of course have delegated autonomy and authority to agree these arrangements, within their areas of expertise”. Could the Minister specifically endorse Sir John’s view?
I would also be grateful if the Minister could clarify a few further points about partnerships. What changes will research councils and their partners experience in practice as a result of the new UKRI/research council structure? What different experiences would new partners experience? Under what circumstances would a research council’s plans for research partnerships need explicit approval from UKRI before they could be activated? Finally, on a more general level, what spending decisions, if any, would be reserved to UKRI?
Could there not be a delegated authority to do this?
The Minister asked me to withdraw the amendment but I think we have started a whole new debate—this letter will be very interesting when it appears. I thank the Minister for his response, particularly for nuancing the whole issue of taking something back for Report for stiffening up, which is a very nice phrase and we look forward to this stiffening up on Report. I thank noble Lords for their contributions, particularly the noble Lord, Lord Turnberg. I assure him that he has not outlived his usefulness. There is a great deal of usefulness still to come.
This has been a hugely interesting debate. Two things have emerged from it. First, recognising the importance of the charitable sector for research, particularly medical research, by the councils themselves or indeed UKRI is something that has to be addressed. I hope the Minister will address it when it comes back on Report. Secondly, partnerships are now a fundamental issue. I agree totally with the noble Lord, Lord Patel. The understanding of most people in this Committee—other than the noble and learned Lord, Lord Mackay of Clashfern—was that the councils would be able, as they are now, to make their own arrangements for commercial and other partnerships, either with charities or bodies overseas. If that is not to be the case, a whole new bureaucracy has just emerged from this debate. But I thank the Minister and beg leave to withdraw the amendment.
My Lords, I must remind the Committee that, if this amendment is agreed to, I cannot call Amendments 480 and 481 by reason of pre-emption.
My Lords, I wish to speak to Amendments 480 and 481, which stand in my name and that of my noble friend Lord Sharkey. Before doing so, I offer support to the noble Baroness, Lady Brown of Cambridge, particularly for proposed new paragraph (a) in Amendment 479A, which would insert a requirement for a non-executive chair for each of the new research councils. I totally agree with the point she made. Having worked under two non-executive chairs at NERC, I know that the advantage they bring to the challenge facing the chief executive and to leading the board in terms of that challenge is of fundamental importance, and doing so would be difficult without it. I await the Minister’s response on why the Government have chosen the route of an executive rather than a non-executive chair. That is a huge departure from the way in which we have approached the research councils in the past.
I confess that I tabled Amendments 480 and 481 to try to tease out from the Minister why the councils should consist of between five and nine members rather than between nine and 13, eight and 14 or some other number. There does not seem to be a clear explanation as to why those numbers have been chosen. I admit that I generally prefer to have small boards—of one person, if possible—because they are likely to be far more effective, efficient and dynamic, but there is clearly an optimum size depending on the nature, the mission, the budget, the governance and the expectation of the organisation.
The Bill—wrongly, I think—assumes that each of the new research councils will be exactly the same, but they will not; they will have very different aspirations, albeit a general one in terms of promoting research. The current research councils have memberships ranging from 10 on the ESRC to 17 on the EPSRC, and that is entirely possible because the Science and Technology Act 1965 did not say anything about numbers. I suggest to the Minister that, rather than adopt an amendment of this sort, it may be better to remove this requirement altogether and to allow the newly formed research councils, with guidance from the Secretary of State—we are very keen on that—to decide what number of members would work well for each one.
Amendment 481, the second amendment in my name in this group, is perhaps more significant. The one thing I have learned while I have been on a council—sorry, I have learned a lot of things; that sounded awful. But one of the most important things I have learned is the value of the lay members who come along to challenge the executive, and indeed the council, in ways that I did not think were possible. That has been particularly important as our research council has tried to remove our research institutes into different governance arrangements. It has been hugely important to have people who actually understand the machinations of changing governance and financial structures and who are able to look at complex organisations working with each other. Therefore, Amendment 481 says that on every research council there should be a minimum number of lay members to allow that challenge. If you had a board of five, it would be very difficult to say what the minimum number should be. I accept that four is a purely arbitrary number, and I look forward to the Minister’s response.
My Lords, I support Amendments 479A and 481A, to which I have added my name. I declare my interests in higher education and research as a professor of engineering at Cambridge University and as indicated in the register. I speak from my experience both as an active leader of university research, collaborating very closely with industry, and as a practising engineer in industry for almost 30 years before becoming an academic.
As has been said by my noble friend Lady Brown of Cambridge, and reinforced by the noble Lord, Lord Willis, the aim of these amendments is to maximise the effectiveness of the councils, including Innovate UK, under the proposed new UKRI structure. They should each retain independent non-executive chairs, as well as having a chief executive. This generally works very well for the research councils and Innovate UK as they currently operate—each has a chief executive and a non-executive chair, the latter usually from a business background. This is surely good governance, facilitating the successful operation of each council, as well as ensuring that the council can provide effective challenge to its chief executive. The non-executive chair can also play a key role as an independent senior voice for each council. The Bill proposes to remove the non-executive chair, which many of us believe would reduce the effectiveness of each council. The aim of these amendments is to restore that important role.
In the case of Innovate UK, it is especially important that the non-executive chair that we are proposing should be from a science-related business background. Industry will want to see this. Close engagement with industry is vital for Innovate UK’s effectiveness. Innovate UK will be able to operate most effectively with its unique business-facing focus if the majority of the ordinary council members are from a science or engineering-related business background. There is a real danger that industry will perceive the UKRI structure currently proposed in the Bill as a downgrading of Innovate UK in terms of industry engagement. Amendments 479A and 481A seek to avoid this.
My Lords, I agree that the issue of research council autonomy is of the utmost importance and will take this opportunity to restate the Government’s commitment to the Haldane principle so well described by my noble friend Lord Willetts. I think we will be coming back to the Haldane principle later this evening. We sought to embed it throughout Part 3 of the Bill.
These reforms have been developed following Sir Paul Nurse’s independent review of the research councils, which involved significant consultation with the sector. It would not be for the benefit of research and innovation, or the UK, were we to delay bringing these reforms forward while conducting another review. In implementing Sir Paul Nurse’s recommendations it will be necessary to make changes to current structures—for example to better enable inter-disciplinary research. I am confident that we can undertake these reforms to build on the existing success of our funding bodies.
I reassure noble Lords that the research councils will continue to be vital components of the research and innovation landscape, and through Clause 103 we are protecting their symbolic property and goodwill, including their name, insignia and branding. Furthermore, they will retain their discipline responsibility, operating within a structure that enables greater interdisciplinarity.
Key among Sir Paul Nurse’s recommendations is the need for a single accounting officer. To implement his vision, the governance structure of research councils needs to change and the role of the chief executive will evolve accordingly. Council executive chairs will be powerful positions focused on key strategic planning, performance management and decision-making within their disciplines. The role will have sufficient powers and should be able to attract extremely high-quality candidates. To ensure that this is the case, the role will combine those of the current council chair and chief executive.
I do not believe that a distinct, non-executive chair position is necessary within this new arrangement. Councils will have collective responsibility for strategic, scientific or innovation decisions in their disciplines and they will, for example, continue to take decisions on the prioritisation of their hypothecated budgets within their delegated limits. The UKRI chief executive and board, which of course has a non-executive chairman, as well as the executive committee, will be able to provide challenge and support to inform these decisions. Each executive chair will also be supported by their council. Introducing a non-executive chair and chief executive for each council into this line of accountability would risk confusing accountabilities within UKRI and undermine its key strategic role.
The noble Lord, Lord Mendelsohn, referred to Confucius and the three ways of improvement: reflection, imitation and experience. All my experience—it is possibly bitter experience—is that confused lines of accountability lead to problems. To have chief executives of councils who are accountable to a non-executive chairman, with perhaps a dotted line there and a straight line to the chief executive at UKRI, would build accountability problems into the structure. I was interested by the suggestion of the noble Lord, Lord Broers, of an equivalent to a senior independent director or SID, in a sense imitating corporate governance on the board of a council. That is worthy of further consideration. Perhaps the chair of UKRI might like to discuss that with council members once they have been appointed.
On the proposal for an executive committee, I fully agree that such a committee would provide a valuable forum within UKRI. Yet an executive committee would simply be a matter of good organisational design and governance, and it does not need to be in the Bill. However, noble Lords made an interesting case warranting—I regret to say—further reflection.
Following on from this, I will also address the suggestion from the noble Lord, Lord Mendelsohn, that the executive chairs of councils should be consulted on the development of UKRI’s strategy. I agree wholeheartedly; it is a necessity to ensure the overall coherence of the UKRI strategy and each council’s strategic delivery plan. I fully expect the executive committee, on which all the executive chairs will sit, to play an integral role in this process.
On Amendment 480, we set an upper limit on the number of members on each council to facilitate their effective and efficient operation. I believe that this is appropriate, particularly given that the UKRI board will take on certain functions such as oversight of corporate functions. None the less, the noble Lord, Lord Willis, and others made a compelling case to increase this limit. My noble friend Lady Neville-Jones suggested that there should be no limit at all. Again, that is something that we would like to reflect on.
On Amendment 481, regarding lay representation on councils, I appreciate the intent with which the noble Lord tabled this amendment and reassure him that this legislation does not preclude the councils from appointing lay members, as many currently do. I hope that I have provided some reassurance—
If you imagine having a chief executive who is also an academic, the rest of the council could then be appointed as academics. Where does the challenge come there to address the issues mentioned earlier about, for instance, the north, Scotland and other organisations?
I think the challenge comes from two places. First, the executive chairman would be on the executive committee of UKRI so it will be challenged there. Secondly, there will also be challenge—or support, where required—from the UKRI board. I hope that I have provided reassurance on the proposed governance structures and powers regarding the councils, and ask the noble Baroness to withdraw the amendment.
My Lords, Amendment 485C is in my name. I want to follow the theme developed by my noble friend Lord Mendelsohn in the latter part of his remarks. This country needs strong industry and strong technology, which are vital to our future survival. The universities are indispensable in this respect. But the standing of our universities in the world, particularly universities with unrivalled reputations—I am proud to be involved in one, LSE—have those reputations because of the quality of their research. What has sometimes been most important in building up that reputation is exactly what my noble friend was talking about: the independence of that research. Within the vital indispensability of the applied research we do there is also a danger: that we lose perspective and the independent ability to judge what it all adds up to for the future well-being of our country.
It is no good trying to disguise the great concern that exists that in placing heavy emphasis on applied research and its vital needs, which we have debated this afternoon, the social sciences get weaker. It is absolutely indispensable for us to have firm guarantees from the Government that whatever arrangements are made, the social sciences will be guarded and protected, because within them are the people who see the consequences of developments as they take place. They see the wider social implications of what is happening. If we are talking about the well-being and viability of our society, their significance cannot be underrated. My amendment would simply add to this by saying that pure research matters, and we must emphasise it. In doing that, we must not become so mesmerised by the battle to survive in the immediate economic sense that we lose the perspective which is the guarantee of our future well-being as a nation.
My Lords, while I strongly support the amendments in the name of the noble Lord, Lord Mendelsohn—the points he made were absolutely right and I hope the Minister will be able to address some of them—I would like to concentrate my remarks on Amendments 493, 494 and 495, which are in the names of my noble friend Lord Sharkey and I and the noble Lords, Lord Cameron of Dillington and Lord Stevenson of Balmacara.
In outlining the desirable functions of the research councils, Clause 89 is far too narrowly defined, particularly subsection (4)(a). Amendment 493 recognises the importance of resilience as a fundamental requirement for the UKRI landscape. While a significant amount of the research funded by research councils should rightly contribute to growth—and most certainly does—a significant amount of research council investment directly benefits the economy by avoiding cost, rather than increasing income. Both these funding objectives are important and contribute to the UK’s resilience. Equally, by retaining a broad scientific capability across the research councils, the UK retains the ability to be resilient when under threat or pressure.
In his earlier remarks on his amendments the noble Lord, Lord Mendelsohn, stressed the importance of the arts and social science in this respect but the impact of other areas of science is equally important. Successive Governments have cut back on our national capability to generate scientific advice, and thereby resilience, by privatising government laboratories such as the government chemist, which is within LGC, the National Physical Laboratory and the Forensic Science Service, which was the last to go into 2012. I am not making a negative comment about privatisation, but once the Government could no longer rely on them for advice, an element of national resilience went at the same time.
Particularly since the mid-1990s, right across government, departmental resource for in-house science research has dropped dramatically. Since 2010 it has virtually disappeared from some departments, so it is a rather academic exercise to say whether it should be included within UKRI or elsewhere, because most of it has gone. The only way the Government can get a great deal of that hard scientific advice is, yes, through their own advisory services, but from the research councils. The need for the research councils to maintain capacity to train a body of scientists to carry out research on all manner of possible events—from avian flu to erupting volcanoes, from BSE to the El Niño effect—and to support the efforts of organisations such as the Met Office, the Antarctic service, Rothamsted and the Diamond accelerator has never been greater. It is the research councils which generally develop the skills at PhD and postgraduate level to supply those cadres.
Amendment 494 follows in a similar vein. Clause 89(4)(b) clearly recognises that research councils should have regard to the desirability of “improving quality of life”. It would be odd if they did not want that, which is clearly an essential element of government. This amendment would go much further by adding that research councils should support research activity that seeks to improve quality of life by seeking to enhance,
“social inclusion and community cohesion”.
When I wrote these amendments, I did not know how appropriate they would become as the threats to social inclusion and community cohesion, both here and abroad, become even greater. Using scientific research to make our lives simply better, rather than wealthier, seems an objective well worth pursuing.
However, Amendment 495 is in many ways the most significant in this small group. I hope that when he responds, the Minister will either accept this in its entirety or, if not, find a suitable set of words to convey the same meaning. A huge, although I believe unintended, consequence of the Bill, along with the emergence of UKRI as a new accounting body for UK science, is that the future success of UK science will be judged by its economic rather than its societal impact. Each should have parity of esteem. The principal role of fundamental or discovery science is to improve the nation’s science and knowledge base. Everything else flows from that, which should be an objective in its own right. While research councils must guard against their presumed inability to draw to an end certain funding lines of inquiry, we should never be so risk-averse that we do not try to fund risky ventures but always try to fund winners. Some of the greatest fundamental science had absolutely no outcome at the time it was developed, yet has proved incredibly powerful across the world.
My Lords, I support Amendments 493, 494 and 495, to which I have added my name. I must declare interests as chair of the advisory board of CEH, a trustee at Rothamsted and chair of the strategic advisory board of the Government’s Global Food Security programme. As has been explained, these amendments are designed to broaden the vision of the purposes of the research to take place under the councils within UKRI. It is wrong for the primary focus of Clause 89(4)(a) to be pinpointed solely on economic growth. To my mind, that is a throwback to the bad old days of the 1980s, when competing in the marketplace at all costs was considered the primary purpose of life. We soon realised that that was not sustainable. I say that as a past member of the Round Table on Sustainable Development, so I use “sustainable” in that context advisedly.