Higher Education and Research Bill (Third sitting)

Matt Warman Excerpts

Committee Debate: 3rd sitting: House of Commons
Thursday 8th September 2016 Public Bill Committees

[Mr Marsden]

Q What about the not-so-good parts?

Dr Ruth McKernan: I am getting to that. Another good part is maintaining the business focus. There are three areas in particular on which we need to be absolutely sure that the intent and what was in the White Paper is still there in the Bill. The first of those is the business experience of the board and the Innovate UK champion, which is very clear in the White Paper. As I understand it, that is possible and enabled through the Bill, but I think that the balance of business and research experience is very broad and could be tightened up a bit.

The second area is the financial tools. We are keen to be able to use things such as seed loans and equity, and other councils within UKRI have dipped a toe into that. Seed funding through Rainbow has been done through the Biotechnology and Biological Sciences Research Council and the Science and Technology Facilities Council, and the Medical Research Council has done a very forward-thinking thing by creating MRC Technology, which looks at royalty streams from work it has done.

We need to be absolutely clear, in how the Bill is finalised, that we ensure we have as much flexibility as the research councils have had and some of our enterprise partners have. We work very closely with Scottish Enterprise, which uses more financial tools than we currently have, and Enterprise Northern Ireland. We want to move at speed and to empower companies to grow in scale and be really competitive, but we must ensure we have the flexibility to do that and not slow down our clock speed. I think there is a bit of work to do looking at that in more detail.

The third point is about institutes and research. The Bill gives us the great opportunity to look across the whole spectrum, from very basic research institutes to catapults. They go from future-thinking research to business-focused, short-term delivery. At the moment, as I understand it, if Innovate UK wanted to create an institute and employ researchers to do the work that businesses need, we absolutely could. I am not sure, within the letter of the Bill, that we are still going to be able to do that. I think that probably needs to be looked at. These are all conversations that we are already having with the people who are putting the proper wording on the Bill, so it will not be a surprise that those are some of our concerns. They are the main three.

[Matt Warman (Boston and Skegness) (Con)]

Q The Science and Technology Committee has heard from all three of your organisations about the UKRI future. I think the consensus was that UKRI allows the research councils to be more than the sum of their parts. Can you talk a little about how we ensure that is actually the case, rather than just hoping it happens?

Professor Philip Nelson: That is the critical question. The objective is absolutely to make us more than the sum of our parts. I think it will take, in practical terms, a lot of good will and hard work on the part of the new executive chairs of the new research councils, when they come into being.

I think the principles are clear, and I believe they are accepted by the Government, that we still need those seven discipline-facing identities and that those disciplines have clearly delegated budgets, with authority over them. That is one of the core principles that we have expounded. Set against that, we absolutely need to enable the councils to work together better and incentivise that working through some means. Those details have to be thought about more and worked out, but I certainly detect a will on the part of the councils to do better collectively. We have had a programme across RCUK for about a year now which is aimed at achieving precisely that. I think that the move to a single accounting officer will probably enable that to happen more easily, so I do not have too many concerns about it happening. It should be set up to enable that.

I think we absolutely need to retain the good things that the councils already do. Paul Nurse acknowledged that we are highly effective organisations, and the key trick is to make sure we retain that while enabling better collaboration. I am confident that that can be done.

[Matt Warman]

Q Your view is that the Bill lays the foundations to do that?

Professor Philip Nelson: I believe so. Again, it goes back to technicalities, and we are talking to the Department for Business, Energy and Industrial Strategy about one or two of them. I think that the intent in the White Paper is absolutely clear. We are talking about the extent to which that gets reflected in the Bill, but I am sure we can resolve these minor issues.

Professor Ottoline Leyser: I would probably take it beyond the notion that the outcome should be that the research councils are more than the sum of their parts. To me, a key issue here is to provide a really effective interface between the UK research and innovation base, broadly defined, and the Government. That is more than just about the parts being the research councils; it is really about the whole research base and the way that is harnessed, in terms of how bottom-up opportunities arise, how knowledge about them feeds into the Government, and how Government priorities are fed into that research base. That interface is what we have to get right. It is the least effective part of our current wonderful system. We have a wonderful system, but that part is what we are trying to fix.

From the Royal Society’s point of view, what is currently in the Bill is fine, but there is a key missing part that was explicitly laid out in Nurse and that is the executive committee, which is not mentioned anywhere in the Bill. That is where the chief executives of the research councils would sit. That committee is a key layer in governance integration across those activities, and the board will not be able to do that. It is a much higher level, strategic-thinking organisation that must have an overall, big vision focus. The nitty gritty information about the community, understanding where things are going with the science—we must not forget the social science, arts and humanities people—the direction of travel and what opportunities there are come up through those chief executives so it is really important. Even though in principle that body could be established under the current wording of the Bill, the Royal Society’s view is that that should be enshrined in it as an explicit requirement because without that layer of governance I don’t think the operation will work effectively. As I say, it could be back-fitted, but that is always a danger because one never knows going forward what people will decide to do.

[The Chair]

Q Dr McKernan, do you have a view on Mr Warman’s question?

Dr Ruth McKernan: Yes, I have three points to make. On being more than the sum of its parts, with the cross-disciplinary approach we have worked very well with all research councils, but being part of one organisation will absolutely give us the opportunity to do that more efficiently and, furthermore, will help us to do the research that business needs to be successful. That is the element—the business view into research—that is not always easy to get. That is my first point.

The second big advantage is that from the business perspective, a company does not find it easy to know how to access the latest innovation in science that will work for its business. So simplifying and improving the transfer of skills into business is very important. In innovation indices our absorptive capacity, as it is described, is not world leading. I think UKRI will give us the opportunity to improve that.

Thirdly, on a much longer horizon, we want to know and understand how, when we spend money on research, it plays back into economic growth. It is very hard to do that. Many innovation agencies like mine are struggling with the data and the analysis. We are moving into the fourth industrial revolution. So much more will be driven by data and algorithms, and we can do much more sophisticated evaluation. As one organisation, we can ask questions of a common database of grant systems what works and what doesn’t work so we can spend money wisely.

--- Later in debate ---

[The Chair]

I am bound by the programme order to 12.45 pm. We have six Members and nine minutes. People need to bear that in mind so that we have short questions and short answers.

[Matt Warman]

Q I think this question is mainly for Mr Blackstock. The Bill moves towards a risk-based approach to regulation. Could you just talk us through your views on the advantages of that?

Douglas Blackstock: The advantage of a risk-based approach for an organisation such as us and the office for students is that you can direct resources where they are most needed. You can pay attention in a system like that, which is proportionate, to the track record and the ongoing performance of particular institutions. An example that I have used in many speeches over the past year is: why would we visit the University of Oxford as often as we would visit the college above the kebab shop on Oxford Street? They have different track records. It allows you to move to a system described in the White Paper, the Bill and the recent quality reforms—what I would call intelligent monitoring—which is where you actually look at the performance of institutions and then have an intervention that is proportionate to the risk that exists in that institution. That is the right way to go. It is what has happened in Australia, and the United States is probably a year or so behind where we are.

Sorana Vieru: With a move to a more risk-based approach, we really need to ensure that we capture the student voice throughout. With the current system, students really welcome the review opportunity to get changes and to get those from the students as well. A move that goes to student outcomes and annual reports is important to get a robust way of capturing student feedback and ensuring that it is acted on.

[Mr Marsden]

Q I have a couple of questions for Douglas Blackstock, if I may.