The Science Budget
Debate between Matt Warman and Yvonne Fovargue
Yvonne Fovargue (Makerfield) (Lab)
I congratulate all members of the Science and Technology Committee on their excellent report. I especially congratulate the Chair of the Committee, the hon. Member for Oxford West and Abingdon (Nicola Blackwood), who has led us through it so eloquently. The report has hit the nail on the head. As the Chair of the Committee has said, science is vital to securing Britain’s future prosperity, research and development. It not only underpins our economic position, but helps to secure our wellbeing and health, by contributing to potential medical breakthroughs in the treatment of cancer and heart disease and even in the eradication of grey hair, as my hon. Friend the Member for Stoke-on-Trent Central (Tristram Hunt) has mentioned. I was reminded of that at the event I attended yesterday, “Voice of the Future 2016”, which the hon. Member for South Basildon and East Thurrock (Stephen Metcalfe) has mentioned. That event was an opportunity for young scientists and engineers to questions parliamentarians, and the Minister knows all about it because we were both there for the question and answer sessions towards the end of the day. It was gratifying and inspiring to hear that there is such support for science among our young people.
If only the Government were equally supportive. Unfortunately for us all, the Department for Business, Innovation and Skills, where the levers of growth in the Government are found, suffered a further 17% cut in the November spending review. Much was made of the protection of the £4.7 billion science budget until the end of the Parliament in 2020, and Ministers seemed to be especially proud of protecting the science capital budget of £1.1 billion until 2021. I was pleased to be reminded by my hon. Friend the Member for Hartlepool (Mr Wright) that some other Departments did better. For example, the Ministry of Defence, the Department for Transport and the Department for Communities and Local Government—as far as housing was concerned—secured a more favourable capital spend. However, I would be the first to concede that many in science and industry breathed a sigh of relief at that settlement; after all, I think they were expecting much worse.
The situation could have been so much better. As we have just been reminded by the hon. Member for Glasgow North West (Carol Monaghan), flat cash settlements eroded the ring-fenced, non-capital science budget by £1 billion in real terms in the previous Parliament. If we discount the introduction of the global challenges fund, which is geared to overseas development and has many strings attached, we are dealing with another flat cash settlement that will create a serious real-terms decline in funding.
The fact remains that £4.7 billion is only 0.49% of GDP, which pales in comparison with our competitor nations. The UK Government’s spending on R and D is the lowest among the G8 countries. As the Minister knows, the Royal Society has called for investment in R and D to be increased to 0.67% of GDP, to match the OECD average. The CBI has called for it to be doubled to around 1% of GDP. That is because, as the former director general of the CBI remarked last year, we are falling ever further behind our international competitors, and we must take action to ensure that we lead from the front.
Matt Warman (Boston and Skegness) (Con)
I am a member of the Science and Technology Committee. Does the hon. Lady acknowledge that although those numbers, as she presents them, may not sound good, the output that we get for that funding is better than ever?
Yvonne Fovargue
I agree that the output is good, but surely that makes the case for more investment in the science budget, not less.
As the Select Committee pointed out, the UK has fallen behind its competitors in total R and D investment. If that trend is not reversed, it will put UK competitiveness, productivity and high-value jobs at risk. The Committee recommended increasing public and private R and D investment to 3% of GDP. The current position is about 1.6% of GDP. We have heard about how much less we spend than our competitor nations, and we have a serious problem of underfunding.
My hon. Friend the Member for Hartlepool and the hon. Members for Oxford West and Abingdon and for Bolton West (Chris Green) have all cited compelling figures. As they have mentioned, there is much value in using public funding to leverage private money and increase productivity, so why not commit to more funding and lever more from private industry? We are not seeing the level of industry funding for R and D that we need. I welcome the comments by the hon. Member for Oxford West and Abingdon and my hon. Friend the Member for Hartlepool on scaling up investment, not just start-up investment.
In their response to the Committee’s report, the Government mention Innovate UK and the Catapult network, which aims to strengthen R and D capacity and encourage innovation. I commend them for that development. As we have heard, however, £165 million of UK grants to Innovate UK for turning scientific research into commercial applications have been axed and replaced by loans. That creates additional risks for researchers and is liable to damage innovation. Both the CBI and the Federation of Small Businesses have raised concerns. I repeat the call that has been made: on what evidence has this decision been based? Do the Government believe that turning grants into loans will benefit innovation and encourage companies to invest?
On the subject of the Catapult network, why does the north of England do so badly when it comes to Innovate UK funding? The north-west did not have a single Catapult project until late last year, while Yorkshire and the Humber gets about 5% of total funding. How can that be right when the south-east gets 52% of it? As several hon. Members have said, what we need from the Government is a proper road map to outline where are we are going with research and development. Let me add that any road needs to go to the north, not just stop at the M25. It is unclear what the Government are trying to achieve in the long run. What is their plan? Can they see the wisdom of increasing R and D funding as a proportion of GDP to something approaching that of our competitors? Nowhere in their response to the Committee’s report is that made clear.
As hon. Members have said, we have a lot to be proud of in this country. The UK is very good at research—we have heard many of the figures—and we in fact gain hugely in that regard from our membership of the EU, as my hon. Friend the Member for Stoke-on-Trent Central said so eloquently. Scientific development and innovation are critically dependent on collaborative ideas and contributions. The EU helps universities to pursue cutting-edge research. It also makes working across borders easier for UK and European researchers pooling their knowledge, infrastructure, data and resources. In fact, the UK does disproportionately well in securing EU funding. During the last period, we received €8.8 billion in direct EU funding.
We also need to ensure that the UK Government are fully behind the science research project. Flat cash settlements for R and D do not help; nor do Cabinet Office missives suggesting that scientists in receipt of Government grants should not try to influence policy. Whatever happened to the idea of evidence-based policy making? The muzzling of some of our finest minds will not help. Above all, we need a Government who have a sense of the future potential of science funding. That is why everyone has talked about the need for a road map, which is the most important missing element. Unless we have a sense of where we are going, we will fall further and further behind our competitors, instead of reaching for the stars like Major Tim Peake.