UK Science Budget

Kit Malthouse Excerpts

Wednesday 21st October 2015 Westminster Hall

[Stuart Andrew]

I have no choice—of course, I agree with the hon. Gentleman. He is right: this is about supporting the whole United Kingdom.

Evidence has shown that public sector investment in research encourages the private sector to invest too. Analysis has shown that an extra £1 of public funding would give rise to an increase in private funding of between £1.13 and £1.60.

The Government’s decision to protect science in 2010, at a time of significant savings, has been appreciated by the sector. It has enabled researchers to continue to push the boundaries of research and to transform exciting scientific discoveries into tangible benefits for patients and the economy. However, there are concerns that, with the true value of the science budget eroding, and with more savings in the pipeline, research could be at risk. Almost 200 life science organisations recently raised those concerns in a letter to the Chancellor.

Why should the Government invest in research? First, research saves lives. Across a number of different conditions, we have seen huge improvements in the range of treatments available, with people surviving conditions that would have been death sentences in the past. According to statistics from the British Heart Foundation, seven out 10 people now survive a heart attack.

The UK punches above its weight in terms of the outcomes its research sector achieves relative to the amount of money invested overall. On many measures, the sector is the most efficient in the world, and strikingly better than many of its competitors. The excellence of the UK science and research base results from universities’ autonomy and responsiveness; the competitive, dynamic funding system; the dual-support funding mechanism; an effective governance and research infrastructure; and the critical role played by universities in the science, research and innovation ecosystem.

[Kit Malthouse (North West Hampshire) (Con)]

Does my hon. Friend agree that, given the changing nature of the research model in the life sciences industry generally, it is even more vital that the Government maintain their investment in universities? Such is the burden of regulation and the investment model required by the private sector that molecules drugs therapies, often co-researched by the private sector, have to spend much more time in academia. If we withdraw funding at that stage, the research will simply not happen and will not transfer elsewhere.

[Stuart Andrew]

My hon. Friend raises an incredibly important and valid point, which emphasises the points I am making about Government investment in this important area.

An investment in research is an investment in our economy. The UK life sciences industry generates an estimated annual turnover of £56 billion and employs 183,000 people across the UK. Investment encourages innovation, attracts business to the UK and leads to treatments and technologies that allow us all to lead healthier, more productive lives.

--- Later in debate ---

[Joseph Johnson]

We have set out a road map taking us all the way to 2021, and it provides considerable certainty on capital. Of course, a spending review is coming up 25 November, so it would be rash of me to embark on commitments here and now.

[Kit Malthouse]

Be bold!

[Joseph Johnson]

I would not want to do that for obvious reasons. I do not agree with the generally pessimistic tone of my hon. Friend the Member for Oxford West and Abingdon, because investment in science is increasing. The Government play their part, but we should not forget the important part played by the business community in R and D, nor the part that R and D tax credits play in enabling business to make that supporting investment.

I told the Select Committee the other day that the value of our R and D tax credits has now increased to £1.8 billion a year, enabling more than 11,000 businesses to do innovative research. That is significantly up on the previous year, when the figure was only about £1.4 billion. The taxpayer is making a substantial contribution to enabling R and D in this country; business R and D expenditure is also up. In 2013, UK businesses spent a total of £18.4 billion on R and D, an increase of 8% in cash terms on 2012, so it is wrong to focus only on the Government’s share, which we protected in the last Parliament and for which we have outlined a trajectory to 2021 on the capital side. There will be a real-terms increase in capital spend. We are putting in place an ecosystem to make it possible for business and others to continue their investment.