Higher Education and Research Bill

Baroness Young of Old Scone Excerpts

2nd reading (Hansard): House of Lords
Tuesday 6th December 2016 Lords Chamber

[Baroness Young of Old Scone (Lab)]

My Lords, I declare an interest as chancellor of Cranfield University, a postgraduate university that as its stock in trade works very closely with business to bring practical benefits to society. I am also a member of the Science and Technology Committee of your Lordships’ House. It is quite late and it is getting later. I thought I might just try standing up and saying, “I agree with Lord Mair”, but then I thought perhaps no one would have remembered what the noble Lord said since this has been a very long speakers list, so I shall bore the House for a bit longer.

I shall focus on the provision for enfolding Innovate UK into UKRI. Innovate UK has done a good job of promoting innovation, so you could ask the question, “Why change?”. If pressed, the Government say they are implementing the recommendations of the Nurse review, but in his report Paul Nurse said:

“Innovate UK has a different customer base as well as differences in delivery mechanisms, which Government needs to bear in mind in considering such an approach, and which this review, according to its remit, has not looked at in depth”.

So I do not think the Government can really rely on that, since he seems to be saying, “There are pros and cons, and by the way I haven’t looked at it very much myself”.

My concerns are similar to those outlined in the Nurse report. Innovate UK has been a strong influence for good in the commercialisation of university research and has a great track record in working with the research councils. However, its pre-eminent effectiveness has been in its business-facing role, helping businesses, particularly SMEs, and indeed individuals to bring ideas to market. The most significant driver of innovation and R&D in business is the kind of ecosystems that Innovate UK plays an important role in developing, including the role of supply chains and customers in helping businesses to talk to other businesses.

In particular, Innovate UK plays a unique role in fostering very early-stage development. It is probably caricaturing a bit to say that it helps mad, scary inventors with a high passion for a bright idea at a stage when it is only a twinkle in their eye, but it certainly engages with the sort of ideas that have not reached proof-of-concept stage and therefore are not the sort of thing that the banks are going to support—higher risk but worth a punt, as it were. That is where Innovate UK plays a unique role that nobody else does. It is quite telling that the current split of Innovate UK activity is less than 20% on the commercialisation of university research and 80% on business-facing activities.

Although expanding support to the universities for the commercialisation of its research is important, this must not mean that Innovate UK within the UKRI simply just becomes the creature that is there to commercialise the work of the research councils. The research councils, of course, will be a very big factor in UKRI and Innovate UK will simply be a small part of it. It is interesting that, when these concerns were raised with the Government—I am delighted to see that the long-standing, temporarily sitting, and now again standing Minister is still with us tonight—the Minister kindly issued a fact sheet in October 2016 and gave assurances that,

“Innovate UK will retain its current business-facing focus. Innovate UK will not become just the commercialisation arm of the Research Councils. … Innovation is a complex, non-linear process with much innovation occurring business-to-business”.

After that stirring start, the fact sheet goes a bit flaky from its early promise and proceeds to list the extensive benefits of academic to business partnerships, and seems to lose the plot on the business-to-business innovation. In a number of subsequent briefings that we have been lucky enough to have with the Minister, his focus very rapidly shifts to university research when he talks about Innovate UK.

I should reassure the House that I am not against the principles of UKRI. There is a need for the promotion of cross-cutting research, for having a strategic capability to review research agenda in the UK, to have more weight for research in the industrial strategy, and indeed to have a united and strong voice for research in the face of Brexit. I make one simple request: the Government should honour the commitment to enshrine Innovate UK’s business-facing focus in the legislation. The current wording in Clause 90 is inadequate. We need a new clause that lists briefly all the terms of reference of Innovate UK, which is very much needed if we are to be reassured that the Government and UKRI will not tend to forget the business-facing role in the future.