Last week, the House of Lords Science and Technology Committee held an oral evidence hearing to look at funding and investment for science and technology within the Government’s Industrial Strategy.
Sir Mark Walport, the newly appointed CEO of UK Research and Innovation (UKRI), was the first to be questioned. UKRI will, subject to legislation currently in Parliament, incorporate seven Research Councils, Innovate UK and the Higher Education Funding Council for England (HEFCE) and be formed in April 2018. UKRI has been described by Innovate UK as “an unprecedented opportunity to fuse together world leading UK science with cutting edge innovation from British businesses”.
Sir Mark Walport speaking at the Committee evidence hearing (photo taken from the Parliament TV recording of the hearing).
Walport welcomed the strong vision for research and innovation that the Government set out in its Green Paper on the Industrial Strategy. He stated that the UK is “building on strength”, while emphasising that we must “continue to raise our game” in support for science and research.
UKRI will strive to become a strong voice for research and innovation, both nationally and internationally, said Walport. He explained that this will involve UKRI “getting out there” to visit areas not just within the golden triangle, and to understand the different industrial landscapes with the aim to support science and innovation across the country. A key part of this will include getting to know the areas where niche expertise already exists and engaging with academia and businesses to develop new expertise. UKRI will also engage widely with external and internal stakeholders. This feeds into the Government’s aim to drive growth across the whole country with the Industrial Strategy and is welcomed by the BIA.
Jackie Hunter, CEO of BenevolentBIO, and Neil Woodford, founding partner of Woodford Patient Capital Trust, were questioned in the second session. They both spoke about a missing link between the UK’s excellent science base and start-up culture and the successful commercial scale-up of companies in the life sciences. Woodford suggested that the Government could stimulate investment in innovative companies by creating fiscal incentives, such as tax cuts, for investors committing to long-term investment. He stated that while biotech is poorly understood among investors, the financial sector is fast and dynamic to learn new areas where the right incentives exist. Following the session, Woodford expanded on this by advocating for “tech ISAs”, a concept that the BIA has promoted as Citizens’ Innovation Funds.
Hunter argued for the need to “innovate in the middle”. This could be done by copying an Australian model, where pension funds invest in R&D. A similar model in the UK, along with fiscal incentives for investors, could provide biotech companies with the large capital and long-term view required to scale-up and become global success stories.
The House of Commons’ Department for Business, Energy and Industrial Strategy (BEIS) Committee recently launched an inquiry on how to help small business to scale-up, so there is some clear indication that these ideas are being considered in the Industrial Strategy. In addition, the effectiveness of primary markets for science and tech companies is being reviewed by the Financial Conduct Authority. The Patient Capital Review, led by the Treasury, is also ongoing. The BIA is currently working on our industry responses to these consultations.
You can watch the full Committee evidence session here.