Budget Resolutions

Greg Clark Excerpts

Wednesday 27th October 2021 Commons Chamber

[Greg Clark (Tunbridge Wells) (Con)]

It is a pleasure to follow my right hon. Friend the Member for Sutton Coldfield (Mr Mitchell). I do not know whether his offer to the Chancellor has advanced or impeded his prospects in the future, but I am sure that he will look forward to the dinner none the less.

No one can be in any doubt about the central importance of science, innovation and technology to the future wellbeing and prosperity not just of this country, but of every country around the world. Yesterday, my Committee —the Science and Technology Committee—was privileged to hear from Professor Sir Andrew Pollard who, with Dame Sarah Gilbert, was one of the scientists who developed the Oxford-AstraZeneca vaccine against covid. Their work is saving millions of lives in this country and around the world, and allowing life here and around the world to resume. The vaccine would not have been possible had it not been built on sustained research conducted by world-class scientists in Britain over many years. It is not just in vaccine development, but in almost every field of human endeavour that research and science are transforming the world, from battery technology and energy storage, as we move to net zero, to the role that satellites play in monitoring agricultural matters from space to get the best crop yields around the world.

At this most exciting and transformational time for science and technology since the first industrial revolution forged in Britain, it is obvious that our future must be even more science and innovation focused than ever.

In the industrial strategy that we launched in 2017, the then Prime Minister and I committed the UK to invest 2.4% of our GDP in research and development within a decade—the OECD average—and then to move on to 3% thereafter. We increased the public science budget from £9 billion to £12 billion a year by 2020—then the biggest ever increase. I mention this to underline the remarkable fact that this Budget will increase the national investment from public funds in research and development not from £9 billion to £12 billion, but to £20 billion a year by 2024-25.

However, the Government had previously committed in the manifesto to invest £22 billion by that year, so, clearly, it is a source of regret that the Chancellor has not been able to keep that commitment. Having said that, had the original commitment been to £20 billion by 2024-25, it would still have been regarded as a remarkable transformation in our science funding and warmly welcomed. None the less, there is a cost to commitments that are not met in terms of the confidence of investors, who are investing alongside the Government.

Having said that, the Committee and the science community were very concerned that there might be a stop-start approach to meeting this commitment because of the current fiscal difficulties, with future increases deferred until later in the Parliament and therefore more uncertain. Witnesses to my Committee talked about the importance of a sustained increase in funding rather than famine first and feast later. I welcome very strongly the fact that the increases are not just in the later years, but that there is steady progress throughout the spending review period that will give great confidence to the science community. In fact, the later increases to get to £22 billion are somewhat less than the early increases that are being made, so I hope that it might prove possible in future Budgets to find the £2 billion required to get to the target earlier than 2026-27.

[Alison Thewliss (Glasgow Central) (SNP)]

Last week, in my constituency, I met representatives from the Glasgow School of Art, who raised concerns that the creative industries were part of the original industrial strategy, but that that now seems to have been lost given where the Government are going now. Does the right hon. Gentleman share my concern that much economic activity can come from the creative industry—innovation as well as other things—and that perhaps it ought to form a larger part of the strategy?

[Greg Clark]

The creative industries play a crucial role right across the country. The creative industries cluster in Glasgow has given a great deal of boost to that city and that has been matched by a lot of private sector investment. I pay tribute to Sir Peter Bazalgette who led the creative industries review that resulted in that. The money is there now as a result of this settlement and I very much hope that the faith placed in successful programmes such as that will be maintained.

Let me say a brief word about the fact that the Budget and the spending review provide the necessary funding for our association with Horizon Europe, the European funding system. There are many advantages to that association, as science is inherently international, but we are facing difficulties with the Commission ratifying our application for association. I do worry that the delays are already leading to British research institutions not being included in bids that are being put together for some of the funding that will be available over the next seven years. As every month goes by, the attractiveness of association diminishes.

The Chancellor has confirmed to me personally that the Horizon subscription that is listed in the Red Book is guaranteed, available and set aside. It is £1.3 billion this year and rises to £2.3 billion in 2023-24, and more thereafter. We no longer get more out of Horizon than we put in, which was the case when we were a member of the European Union. We also have to pay an administration fee, which I understand to be about £200 million a year, which is about twice the administration cost of running our own domestic innovation programme. Given that and the delay, it seems to me that the science community will want to assure itself that it would not prefer the budget that the Chancellor has guaranteed to be in the hands of UK universities and research establishments so that they can deploy themselves in international collaborations.

Science is inherently international, so I share the welcome of my right hon. Friend the Member for Sutton Coldfield for the prospects of resuming the 0.7% target on official development assistance. I particularly welcome the increase in the Red Book for ODA funding of science, even within the spending review period. In fact, that will nearly double. The cuts to science programmes that were funded by ODA were a big blow to science, so it is good to see that funding increase.

A major theme of this Budget is levelling up. British universities and research institutions all across Britain are often the most important institution in their area for driving prosperity. I therefore hope that, with a substantially rising tide of funding, it will be possible to keep faith with the programmes of excellence that we have, while strengthening the contribution made by the regions and nations of the United Kingdom. As Professor Richard Jones of the University of Manchester said in evidence to my Committee, that is literally levelling up—advancing the prospects of the nations and regions without diminishing the investments that we already make.

The science and research community and my Committee will look in detail at what has been proposed, but we recognise this substantial commitment to science—the biggest ever increase in the science budget. Even if we regret that the £22 billion that was scheduled may be two years late in being delivered, we are relieved that there will be sustained and steady progress towards it. If the economy recovers even more strongly in future years, we hope that we will be able to get there as planned, as originally set out.