Examination of Witnesses (Questions 1
- 19)
WEDNESDAY 10 MAY 2000
PROFESSOR MICHAEL
WILSON, MR
PETER SIDDALL
AND MR
DAVID TEMPERLEY
Chairman
1. Gentlemen, welcome to the Committee. You
found your way to the Committee rooms. That is the first test.
You appear to have made it up the stairs, apparently with some
difficulty, which is the second test. Now you have the third test.
For the purposes of identification, would you please introduce
yourselves.
(Professor Wilson) My name is Professor Michael Wilson.
I am Chief Executive of Horticulture Research International. I
have been in that post for almost nine months. I joined HRI almost
one year ago. Would you like some background on me? I am happy
to give that.
2. I think we shall get that as we go. Just
names for now.
(Mr Siddall) I am Peter Siddall. I am the part-time
Chairman of HRI. I have been in the position just over two years.
(Mr Temperley) I am David Temperley. I am the Director
of Finance of HRI. I have been in the position since September
1997, about two and a half years.
3. Now then, Professor Wilson, you are in a
mess, are you not?
(Professor Wilson) I hope not. In terms of the Institute?
4. May I refer you, to begin with, to your memorandum
to us. Reading that memorandum I get the impression that you are
in a mess. You do not really know where you are going and you
are not quite sure how to get there. Disabuse me.
(Professor Wilson) I would certainly be happy to do
that, Chairman. The Institute is in a state of change and transition.
Obviously, with myself being appointed as Chief Executive, we
have changed the emphasis of the Institute. We do have a short-term
problem of financing but I think all the signs, from my senior
scientific staff and my staff in general, are very positive and
exciting. We are going through a period of refocusing, of consolidating
the achievements of the first decade, of work within HRI. What
I think we have achieved, with remarkably good efficiency, is
the integration of the organisation; joined together scientific
groups on all of our sites. One of the problems we have had with
HRI right since the beginning—and the first impression when
I joined the organisation a year ago—was that history and
geography were not on our side. There was an element of segregation.
It needed pulling together, integrating and streamlining some
of our management procedures. The changes which have been put
in place have quite rapidly assisted in that coming about.
5. So when you took up your appointment you
found it was a mess.
(Professor Wilson) It was not a mess in that sense
but it was not where I wanted it to be. Coming from my background,
working predominantly on single institute sites like the John
Innes Institute or Scottish Crop Research Institute, and universities
in America or the United Kingdom, I was familiar with more team
work and proximity and focus. Of course, I was joining an organisation
which had a very broad remit; worked in a very large number of
crops; a lot of people coming from very different backgrounds.
They all had different histories of employment. Funding streams
were very diverse; a very complex funding package. To be frank,
it was very tricky to get the hang of it all in short order when
I first walked through the doors.
6. But it was not just a question of getting
the hang of it. You actually found that it was not working very
well, as well, did you not? Once you had your feet under the desk,
and you had a look at the books, and you had the sense to get
the feel of the chemistry of the organisation, what were your
initial conclusions about what was not right and what needed to
be done to put it right?
(Professor Wilson) My first impression was very much
focused, of course, because of my own background, on the scientific
aspects of the organisation. The core business of HRI is doing
science. I was first appointed as Science Director. I had to make
a rapid judgment on how we would raise the profile and impact
of the science within HRI and disseminate that profile internationally,
as well as improve our contacts throughout the United Kingdom.
I used the science as the catalyst, as a vehicle, to draw together
the management of the sites and the teams. The first job I was
given by the previous Chief Executive, Chris Payne, was to establish
a number of functional teams. There had been talk about teams
before but they were not really functioning. When I talked to
my senior scientists, Heads of Departments, these had been planned
but nothing had been crystallised. So within the first two or
three months of my arrival, working with the Heads of Research
Departments, we pulled together these critical teams. They really
began to set the agenda for the organisation and they began to
help add value and new interactions between the various groups.
Then, in the summer, when Chris resigned and ultimately I was
appointed as Chief Executive, I took the next step, as it were,
and looked at this segregation of sites business. I was a Site
Director, and one of our other Site Directors was taking voluntary
premature retirement anyway; so it seemed like an opportunity
to remove that level of management and continue the integration
through science and bring in Site Managers to look after the infrastructure,
again to facilitate the push for science. That was phase two,
if you like. I must admit, just in the last few days, as we speak
now, there is a major scientific review going on at Wellesbourne.
I was delighted to listen on Monday afternoon to presentations
which are showing evidence of that communication: workshops, interactions
between the groups and the various players.
7. So you found it a rather disparate far-flung
organisation which needed pulling together? Is that a fair summary?
(Professor Wilson) I think the phrase I used was that
there is too much history and geography and a very complex funding
base; if I had to summarise in one sentence what my impressions
of HRI were when I walked in. I had very little prior knowledge
of it. I came in very cold to the organisation.
Mr Jack
8. Why did Chris Payne resign?
(Professor Wilson) Chris confided in me that there
was a job which came up at Reading University, which he was particularly
keen on. It was the job he had always wanted. It is the senior
horticultural job in the United Kingdom in the university sector.
He resigned prior to the end of his second full five-year term.
When he told me the news he said, "There is no easy way to
break this to you, Mike." I think he was ambivalent about
it.
9. So there was no pressure put on him internally
or externally? He just decided that a career change was in order?
(Professor Wilson) Absolutely.
(Mr Siddall) I think it is important to recognise
that Chris Payne was the Chief Executive who, in fact, took on
HRI when it was first formed. He was the person who shaped it.
He did an incredibly good job—there is no question in my
mind at all—in setting it up and putting it on the right
road.
Chairman
10. The reason why we have adopted this line
of questioning is because from the memo you have sent us, and
I am quoting paragraph 12, which is about the profile of your
income since 1990: "HRI have been unable to increase their
commercial income to cover the recent reductions in public sector
funding. As a result HRI are moving into a loss-making situation.
HRI is now examining, in discussion with MAFF, the options for
turning this situation around without access to significantly
increased public funding, including a realistic targeted increase
in commercial receipts..." How is that coming along?
(Mr Siddall) It is coming along very well. I think
that you have perhaps to recognise that the turn-down in public
funding is a one-way street. It has been going on since the organisation
was formed. The chart that we have given you demonstrates that.
It is accelerating currently. I think if you refer to our corporate
plan of last year, we made it very clear that we were not going
to be able necessarily to guarantee to replace the public funding,
which was declining, with commercial income at the same rate,
with any certainty. This represents a major change in an organisation
of the sort which you correctly described a few minutes ago. So
it needed time. There is a very significant phrase we have used
quite often in these papers, which talks about the uncertainty
associated with building up sufficient commercial income. It is
that which is the challenge for management. It is there where
we can give you some confidence that we are on the right track.
11. If I look at paragraph 14, you say: "The
key to achieving this must be proactive and ongoing recruitment,
support and empowerment of the brightest, most able and productive
scientists..." etcetera. You need money to do that. You have
to get up revenue because scientists are expensive commodities.
(Professor Wilson) They are, but hopefully these types
of scientists can bring a lot of money and earning capacity with
them. If you build them into these critical teams, which have
both a national and international reputation, then that will act
as a focal point for significant funding. I just want to go back
to the point about Chris Payne. I just want to say that Chris
had a very remarkable role to play in the development of HRI.
I was very sorry to see him go. I also realised that I had a very
tough act to follow.
12. I do not want Mr Payne to become the Banquo's
Ghost of the inquiry, if you see what I mean.
(Professor Wilson) I am trying to avoid that.
13. One final point, in paragraph 18 you talk
about: "... the current group of 16 Research Area Strategy
Teams referred to in 5.3(iii) above." I have looked vainly
for this but it does not seem to exist.
(Professor Wilson) It has become 17. There is an editorial
problem there.
14. A scientific mutation.
(Professor Wilson) A secretarial mutation anyway.
It is 17(iii) and those are the multidisciplinary teams just referred
to.
Mr Jack
15. Before we get into the detail, I wonder
if our three witnesses could tell us what they believe are presently
the challenges for the United Kingdom horticulture industry in
its various sectors. What are the key challenges it faces?
(Professor Wilson) The key challenges are clearly
to become more efficient, reduce inputs, be more effective, and
to deliver products that the consumers wish and demand.
Mr Todd
16. I think you said that recruiting good quality
scientists brings income with them. If I take you to paragraph
13, you say: "HRI provides the world's largest single integrated
team of horticultural scientists and is the leading source of..."
etcetera, etcetera. Yet you have a difficulty in attracting income
now. Your income from non-public sector sources appears to be
falling. You have certainly got a lot of scientists, because you
make something of it in this statement, but they do not appear
to be attracting revenue. You then go on in that paragraph to
say: "Our aim is be the first choice supplier..." the
implication that you are not currently. In spite of the scale
of your scientific expertise, you are currently not the first
choice supplier in your niche of the market place. Could you expand
on that.
(Professor Wilson) Let us go back to the first point.
First, science and the imperatives of research are a dynamic.
They are changing all the time. We do have the largest team of
horticultural scientists in the United Kingdom. Some areas are
sun-setting and some are opening up. It is keeping that dynamic
alive and keeping our ability to attract new funding from new
sources—
17. Where is the sun rising and where is it
setting?
(Professor Wilson) The sun rising without doubt will
be in some of the more ecological holistic areas, particularly
underpinning the new initiatives in organics; and also in biotechnology.
Unashamedly, my own background is in academic research in biotechnology.
We have new contacts, and I have brought new contacts to the organisation
which, I believe, will bring in substantial sums of money. The
scientists who are already at HRI have been developing some intellectual
property over the last five to ten years, which is now beginning
to deliver. I cannot go into this in any detail because of commercial
confidentiality—but there are some very large and significant
contracts being signed, using intellectual property, which has
been captured within HRI. This has benefits for the horticultural
sector.
18. Okay, so that is where the sun is rising.
Where is it setting? If you can tell us without giving too grim
a message to your largest single integrated team, who might listen
with concern to references to some of the areas they are presumably
toiling in.
(Professor Wilson) It is difficult to be precise as
to where the sun is setting. It is sort of self-selecting, where
funding ceases to come in. That is obviously, by definition, where
there is a lack of interest from the industry, from sponsors.
19. From where is it failing to come in?
(Professor Wilson) I do not want to specify particular
areas because there is always hope that we can rejuvenate some
areas by retraining and reskilling and putting in new technologies.
We know that the focus of funding for top fruit is moving away
from MAFF. There are some areas of work, in some areas of seed
biology, which need to be revitalised. Doubtless there are others.
My scientific committee has done a very thorough analysis of all
of the programmes, which all of the scientists identified, where
these sorts of choices have to be made.
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