EU Report: Effectiveness of EU Research and Innovation Proposals

Lord Jenkin of Roding Excerpts

Thursday 21st November 2013 Lords Chamber

[Lord Jenkin of Roding (Con)]

My Lords, I am the first speaker in this debate who was not a member of the committee. Indeed, I have never served on any of the European committees, but I was persuaded to take part by the chair of the committee, my noble friend Lady O’Cathain. I very much share the regret of the noble Lord, Lord Kakkar, that she is unable to be here today.

To pick up a point made by the noble Lord, Lord Haskel, figures that I have seen recently about what is called, in the jargon of the business department, BERD—business enterprise research and development—show that it is a smaller proportion of the total because research and development in other fields has grown very rapidly, but BERD has continued to grow in recent years. This should not be ignored. Indeed, in 2011 it increased in real terms by 6%. As that normally happens only during periods of economic growth, this is quite encouraging and we should not be too pessimistic about it.

When I put my name down to speak, I was a bit apprehensive that I would very quickly find myself out of my depth and perhaps addressing issues that were outwith the main thrust of the report. I need not have worried. The noble Lords, Lord Kakkar and Lord Haskel, have both raised issues to which I will wish to return.

I am doing this because, when I read the committee’s report and the Government’s response, they threw some fresh light on how institutions within the European Union deal with this hugely important area of research and innovation. It led me to compare the way in which this is done in the Community with what happens in this country, always remembering, of course—as the noble Lord, Lord Haskel, reminded us—that much of the money spent in this country that counts as UK research and development or research and innovation is funded through the Community programme.

First, there is obviously common ground. The procedures for assessing the impact of any proposal for research have developed in recent years often in different ways and at different paces, but the purpose of impact assessments has become increasingly clear both to EU institutions and UK bodies such as universities and the research councils. Simply stated, it is this: they are to help those whose task it is to decide how to spend research and innovation money to make choices that will give the best value for money.

But immediately one comes to a question: what is meant by value? At this point, I should perhaps state my interest. I attended a recent seminar held by the Foundation for Science and Technology, of which I was chairman for nine years and am now the president. The subject of the seminar was:

“Maximising the value of the UK strengths in research, innovation and higher education”.

I thought that this might throw some light on the comparison between this country and the EU. Indeed, the words might have been paraphrased as “the effectiveness of research and innovation proposals”, which appears in the title of this report, but that case relates to the European activities.

Whether it is value that you are talking about or effectiveness, I am inclined to believe that they aim at the same thing. Here, the noble Lord, Lord Kakkar, gave us an interesting point on what he thought might be part of value or effectiveness. That was echoed by one of the speakers in our seminar, who asked the question, “What is the value?”. He answered it by asking more questions: “Is it employment, or productivity, or human capital and skills, or human contentment and health—or is it all these things?”. Some of the participants in the discussion started at the other end and suggested that the purpose of research is the advancement of knowledge and understanding, and that this should in turn lead to the innovation which we all seek.

One feature of our discussion on that occasion was that, although the UK stands very high in the world rankings for research or universities or whatever it is—I shall cite in a moment some figures on that which we were given—when it comes to innovation, we are not so successful, as the noble Lord, Lord Haskel, indicated. I shall come to one or two of the reasons.

However, I turn first to universities. Three or four of our top universities regularly figure in the top 10 of virtually every world ranking of universities. When one looks at a longer list of, let us say, the top 50 universities, one sees that there are very few, if any, in other parts of the European Union. In Europe, we absolutely dominate the university field. It has been suggested to me that this may be because far less research is done in EU universities than is done in universities this country and, therefore, they do not rank as high. I can understand that but it is interesting to note that almost none of them is in the top 50. That may to some extent colour the attitude of some of our partners in the European Union.

Turning to research, the UK has 1% of the world population and produces nearly 8% of research papers, almost 12% of world citations and 14.5% of the world’s most highly cited papers. This is a remarkable record of which this country can be very proud. However, as I said a few moments ago, we are not as good at innovating—not nearly as good as this volume and quality of research would suggest that we ought to be. We discussed the trends that may be giving rise to this. The noble Lords, Lord Haskel and Lord Kakkar, have already mentioned one or two of them, but it comes down to knowledge transfer—that is the key phrase—and the difficulty of transferring knowledge from the research field to the industrial field. The noble Lord, Lord Haskel, was absolutely right to put his finger—as does the report—on the fact that this is even more difficult as regards SMEs. Why should this be? Several reasons have been given. One is the inherent institutional, cultural and financial barriers between universities and business. Another is the great reluctance of businesses in this country, but perhaps also in Europe, to take risks and to realise that introducing the products of new research does involve taking risks. There is a reluctance to do that. I was told that if a firm announces that it is going to undertake a major research programme, its shares immediately fall on the market, whereas one might think that this would be a plus. However, in the eyes of the market it is not; it is a minus. The other tendency, of which we are all very well aware, is that of thinking short term rather than long term. However, some of the results of research and innovation may be a long time coming.

I come to my main point. Many of the speakers at the seminar emphasised the huge importance of impact assessments. These have grown over the years in many different ways. In this country it is virtually universal practice to require researchers to make the best assessment they can of the impact which they believe their research could have. The Pro-Vice-Chancellor for Research at Brunel University said that in the experience of that university the very process of having to support a research application for funding with a carefully composed impact assessment was making applicants look at how their research might be transferred to other fields. He went on:

“If the ‘impact agenda’ was to be effective in ensuring that researchers embedded knowledge transfer at the start of projects, they must understand how business might be able to use their research”.

Those seem to me wise words which should apply universally. However, when I turned to the report—here I pick up the points made by the noble Lord, Lord Kakkar—I noted that paragraph 133 states:

“We … urge the Commission to ensure that analysis of R&I policy and proposals is based on scientific evidence, rather than political considerations”.

I find it quite astonishing that that has to be said. Then we had the Government’s response:

“Funding based on excellence is fundamental to the Government’s national research strategy and we also encourage this approach at EU level, as it is the most cost-effective use of public money”.

Can my noble friend on the Front Bench say what the Government are doing within the institutions of the EU to make that happen, if this still has to be said? After all, this is the second report that the committee has produced; there was a 2010 report where it made these selfsame points. Yet here they are three years later, having to repeat them yet again.

[Lord Hunt of Chesterton (Lab)]

This is now the second or third time that this point has been made about peer review. Nature has shown that the whole process of peer review and so-called excellence of research tends to be highly biased towards the English language and the American literature. Some of the most important discoveries were hardly referenced at all in the English language. The EU takes a very broad view of science across Europe, while the rather mechanical view of some of our British colleagues about the nature of choosing by excellence is too narrow. The EC, quite rightly, takes a political and social view of the breadth of science across Europe.

[Lord Jenkin of Roding]

I do not know enough about that aspect of the European attitude on this but I totally support what the committee and the Government have said about the huge importance of basing their decisions on, as they put it in their response, “scientific evidence”. It went on:

“Moreover, it is important to stress that this evidence must be robust, peer-reviewed and replicated. Policy decisions should not be made on the basis of a single report which happens to support a political objective”.

I have no doubt that we will hear from the noble Lord, Lord Hunt, a little later, but I would be interested to know whether my noble friend on the Front Bench supports completely what was said in the Government’s response to this report.

I will not go on quoting; I have taken enough time. Again, I come back to my reaction to this. I found it surprising and depressing that these things still have to be said and are not accepted as part of the overall process of assessing research and development projects. We have been brought up against the background of the Haldane principle. Why do we not have something like the Haldane principle operating within the European Union? We may have our problems in this country—I have outlined the problems of knowledge transfer—but I shall finish on this note. I am left with an uncomfortable feeling that the EU’s approach to the effective use of impact assessments in helping decision makers to secure the best value for money appears to leave a great deal to be desired.