Select Committee on Science and Technology Minutes of Evidence

Memorandum submitted by the Office of Science and Technology


  1.1  The Government is grateful for the opportunity to submit evidence to this Inquiry on two important developments which have taken place since its first memorandum was prepared: the publication of the White Paper "Excellence and Opportunity—a science and innovation policy for the 21st century" and the announcement of the allocation of the Science Budget for the period 2001-02 to 2003-04.

  1.2  As the Government noted in its earlier memorandum,[1] the 1993 White Paper "Realising our Potential: A Strategy for Science, Engineering and Technology" was responsible for many of the mechanisms through which Government delivers its science policy and there are many encouraging signs that these mechanisms are working well. The Government believes, however, that further steps are necessary if the full potential of science is to be harnessed for the benefit of all. For that reason, "Excellence and Opportunity" and the anouncement of the Science Budget, following Spending Review 2000 (SR2000), introduced a comprehensive package of new measures to keep the UK in the vanguard of world science and will provide a solid foundation for building a dynamic knowledge economy.

  1.3  Section 2 of this memorandum describes the way in which the range of commitments given in "Excellence and Opportunity" are being taken forward and Section 3 explains the basis for the recent allocation of the Science Budget. Section 4 comments on a number of specific issues relating to both "Excellence and Opportunity" and the Science Budget which the Committee has raised directly with the Office of Science and Technology. These include the purpose of "Excellence and Opportunity", and the process leading to the allocation of the Science Budget, including SR2000 and "the Cross Cutting Study of Science Research and Funding".


  2.1  "Excellence and Opportunity" focuses on investment in scientific excellence, increasing opportunities for innovation and providing a basis for public trust in science, with 10 agendas for action:

    1.  Better Science in Schools.
    2.  Enhancing Scientific Excellence.
    3.  Acting on Foresight 2000.
    4.  People and Skills.
    5.  Universities in the Knowledge Driven Economy.
    6.  Innovation in Every Region.
    7.  Government Departments Encouraging Innovation.
    8.  Making the Most of Our Intellectual Property.
    9.  Linking in to Global Networks.
    10.  Creating Confidence.

  2.2  In keeping with the open approach taken in developing the White Paper, the Government has published an Implementation Plan which explains how the commitments are being taken forward. The Plan is available on the OST website at It provides a roadmap indicating the mechanisms, timescales and targets to which the people responsible for managing the delivery of each commitment are now working. The Plan shows the senior officials responsible for driving each agenda, as well as the details of the officials responsible for each commitment. Progress will be monitored and reviewed regularly by the Ministerial Science Group.


  3.1  As a result of SR2000, the Science Budget, administered by the Director General of the Research Councils in the Office of Science and Technology, will increase in cash terms by a total of £725 million over the three years 2001-02 to 2003-04 (the SR2000 period). In the final year, the Science Budget will be £2,155 million. These additions, taken together with an increase already planned between 2000-01 and 2001-02 mean that the Science Budget is set to grow by an average of 7 per cent per year in real terms over the next three years.

  3.2  Details of the outcome of the SR2000 for the Science Budget and of the allocations of the budget among the Research Councils, the Royal Society and the Royal Academy of Engineering are set out in "The Science Budget 2001-02 to 2003-04", published by the Department of Trade and Industry on 22 November. (See the Office of Science and Technology website at

Science Research

  3.3  A total of £252 million has been added to the Science Budget over the SR2000 period for investment in three cross-Council programmes in key areas of science:

    —  Genomics: following the publication in the summer of 2000 of the draft human genome, in which the UK played a prominent part, the Government is investing a further £110 million to build on earlier investments, increase the level of research in the UK and so ensure that the UK can remain at the leading edge of this crucial area of science. Genomics research will lead to the development of new diagnostics, drugs and materials and will open up new perspectives across biology and the study of the natural environment.

    —  E-science increasingly involves science done through distributed global collaborations enabled by the Internet, using very large data collections, high-power computing resources and high performance visualisation. In some areas, the size and complexity of the data generated by scientific investigation is stretching present computing capabilities to the limit and it will not be long before this starts to act as a constraint on the pursuit of science itself. This is a global problem to which the UK needs to contribute if it is to obtain maximum benefit from the solutions that are needed. To address this, the Government is investing £98 million to tackle key computing problems across a range of scientific disciplines, with additional investment to develop core generic technologies. This investment is very important for large scale, modern science, and is also likely to have high-profile industrial implications over the coming decade as the next generation of e-science enables the next generation of e-commerce;

    —  Basic technology: the Government is investing £44 million in a multidisciplinary research programme which is designed to create fundamental new capabilities which will form the basis of the industries of the future. Likely areas of investment include nanotechnology, quantum computing, photonics and sensors.

Research Infrastructure

  3.4  The new £1 billion Science Research Investment Fund (SRIF) will be invested in further renewing and developing of the infrastructure of the science and engineering base. SRIF is a partnership comprising the Government and the Wellcome Trust, with the Wellcome Trust contributing £225 million over the two years of the Fund. SRIF will build on the Joint Infrastructure Fund (JIF) which ends in 2001-02 and will have provided £750 million for science infrastructure, also a partnership with the Wellcome Trust. JIF has been run as a competition. SRIF will have four streams:

    —  £675 million for universities to fund new building, refurbishment and equipment from the DTI Science Budget (for the UK) and DfEE (via the Higher Education Funding Council for England) (for England only). Decisions on allocation will be made early in 2001 on a formula basis linked to research excellence and the volume of research undertaken;

    —  a £150 million fund provided by the Wellcome Trust for investment in buildings for sciences within the Wellcome Trust remit drawn from top-rated but unmet bids submitted to JIF;

    —  a separate £75 million of Wellcome Trust funding for biomedical science project related equipment/refurbishment, run on the basis of competitive bidding from universities; and

    —  £100 million to be retained by the Office of Science and Technology to modernise research council institutes and to contribute to large national projects.

  3.5  The expectation is that universities should provide from own or third party resources funds for 25 per cent of the investment they undertake.

Knowledge transfer

  3.6  The Government has announced a £140 million Higher Education Innovation Fund (HEIF) for England jointly funded from the Science Budget and by DfEE, through the Higher Education Funding Council for England (HEFCE), to build on universities' potential as drivers of growth in the knowledge economy. This will form a permanent third stream of funding for universities, incorporating the existing Higher Education Reach-Out to Business and the Community fund (HEROBC). In addition to HEIF, one further round of University Challenge (with £15 million available) and one further round of Science Enterprise Challenge (also with £15 million available) will be held. The Government is also making £10 million available next year to encourage the commercialisation of research carried out in the public sector. The details of how these various programmes are to be run will be announced in due course.


  3.7  After three decades in which, on average, the PhD stipend has barely increased in real terms, the Government has signalled a decisive shift. Following increases in PhD student stipends announced in 1998, the Government has recently announced further increases of just under a quarter over the next three years. This will take the basic stipend from £6,800 this academic year to £9,000 in 2003-04. Separately, the Government has committed to provide, jointly with the Wolfson Foundation, some £4 million each year over five years to enable universities to recruit, reward, and develop researchers of outstanding achievement and potential. The scheme will be run by the Royal Society and awards made under it will be known as Wolfson-Royal Society Research Merit Awards.


Issue 1—What the Department sees as the purpose of the "Excellence and Opportunity" White Paper and in what way it represents a progression from Realising Our Potential.

  The White Paper "Excellence and Opportunity—a science and innovation policy for the 21st century" sets out the Government's strategy for science and innovation.

  It outlines the actions that Government is taking, and intends to take, to build upon the UK's record of scientific excellence, and to translate the fruits of our scientific research and invention into products and services that will improve the economic and social well-being of all the people of the UK. There are three main areas of action:

    —  maintaining and enhancing the excellence of the science base;

    —  opening up opportunities for innovation; and

    —  ensuring that people have a confident relationship with science (so that it is seen as an opportunity and not a threat).

  "Excellence and Opportunity" builds on what has already been achieved following the 1993 Science White Paper. It represents a significant development in several important respects including:

    —  funding for Higher Education Institutions (HEIs). The White Paper explicitly recognises that, while different higher education institutions have different missions which they should carry out in different ways, knowledge transfer is a core mission alongside teaching and research. As already noted in paragraph 3.6 of this memorandum, the Government is introducing a Higher Education Innovation Fund. This will build on the potential of universities and HE colleges as drivers of growth in the knowledge economy and will increase their capabilities to work with industry, particularly small firms;

    —  an explicit recognition that Government departments can play a role in encouraging innovation through the way they pursue their objectives, whether framing regulation, purchasing and delivering services, managing and controlling risks. The White Paper proposes measures to encourage this:

      —  Government Departments with an interest in science are being asked to publish science and innovation strategies, drawing on Foresight, which focus on how they can maximise the potential of science and technology activities and how they can drive innovation. The strategies will cover arrangements for improving connections with relevant science and technology overseas, as well as arrangements for commercial exploitation of research, following recommendations from the Council for Science and Technology. And they will say how departments are encouraging innovation, through their approach to regulation, to procurement, and to the services they offer. The Ministerial Science Group, involving representatives of the devolved assemblies and supported by the Chief Scientific Adviser, will oversee the strategies;

      —  a new programme, the new Small Business Research Initiative (SBRI), to encourage more high-tech small firms to start up, or to develop new research capacity, so stimulating innovation throughout the economy. This is inspired by the US Small Business Innovation Research Fund. Under SBRI, departments and Research Councils are opening up, to small firms, R&D procurement programmes worth up to £1 billion, with the target of procuring £50 million of research under these programmes from small firms. Each participating department will aim to procure at least 2.5 per cent of their relevant requirements from small firms. Research Councils will move to meet the target over time, drawing on new money;

    —  seeking to have public sector research establishments, as well as HEIs, embrace a more entrepreneurial role. They will be given an explicit knowledge transfer mission and the managerial responsibilities and freedoms to fulfil it. A culture of managed risk-taking is being promoted by, for example the publication of new guidelines on incentives for public sector research staff and the management of possible conflicts of interest. Financial support will be provided in the form of £10 million to commercialise research done in the public sector, including the National Health Service. A new source of advice will also be available from Partnerships UK, a new public-private partnership established to support the public sector in PPP transactions; and

    —  new Government guidelines will set out a clear presumption that departments should assign the IP arising from Government-funded research to research providers, which are generally better placed to undertake commercial exploitation of the results.

Issue 2—By what process were the allocations arrived at?

  The Science Budget settlement reflected many of the main strands of a cross-Departmental review of science research funding (see "Cross Cutting Study of Science Research Funding—Analysis, Arguments and Proposals", at which concentrated in particular on the Science Budget and DfEE's Higher Education research budget. Review members spent time visiting universities to see for themselves research work in progress and to hold discussions with vice-chancellors. The consultations with academics and with business, led by the Minister for Science and Innovation, Lord Sainsbury, also contributed to the review and the development of the White Paper.

  In order to inform the cross-cutting review and to help in the process of identifying science research priorities, the Director-General of Research Councils (DGRC), undertook a series of consultative meetings with key players with an interest in the science and engineering base. These included the Research Councils, the higher education funding councils, the universities, medical charities which sponsor research. After the SR2000 outcome was announced by the Chancellor of the Exchequer in July 2000, DGRC began the process which led to the recommendation to the Secretary of State of how the new funds should be allocated among the Research Councils. This consisted of a further round of consultative meetings in the light of the settlement and, in particular, a series of meetings with all of the Research Council chief executives. The main objectives of these meetings were (i) to arrive at a suitable balance of funding for the three cross-Research Council programmes in genomics, e-science and basic technology and (ii) to identify those activities that individual councils should be giving priority to or moving away from.

Issue 3—What were the criteria by which the three priority areas were identified, and what are the objectives for these research areas?

  In deciding the main science research priorities for the SR2000 period, the following questions were considered:

    —  What are the leading-edge scientific activities which have potential to add most value to the UK economy and make most impact on quality of life in the medium to long-term?

    —  Which areas of science research build on existing strengths of the UK science and engineering base and of UK industry and so would reinforce areas where the UK already enjoys a comparative advantage?

    —  Where does the UK need to collaborate internationlly in order to ensure that our scientists get access to leading-edge research projects and world-class facilities?

  The objectives relating to the three cross-Council programmes are discussed above in section 3 of this memorandum. The objectives to which the Councils will each be working in respect of their own core programmes are set out in the Science Budget booklet on pages 17 to 30.

Issue 4—Where do the "Report on the North West Science Review" grants appear in the allocations?

  The review of North West Science led by Dr Bruce Smith, which the Government accepted, recommended that £26.2 million should be invested in nine projects. All of these projects fall under one or other of the three cross-Council programme headings described above. As a result, the funding required will be found by the Research Councils from within the allocations made to these programmes.

Issue 5—What is the £68 million unallocated capital for?

  As part of the £1 billion Science Research Investment Fund announced in July 2000, £100 million of capital was made available for investment in Research Council institutes and in large national science facilities. This money is intended to complement, in the Research Council sector, the investment which is taking place in analogous infrastructure in the universities through JIF and the remainder of SRIF.

  The allocations to the Research Councils announced on 22 November 2000 included £32 million of this £100 million, leaving £68 million unallocated. The allocation of £32 million at that stage reflected the need to make some quick decisions on the highest priority investments to allow planning to be started so that timely commitments could be entered into by the Research Councils (see also next section). The allocation of the remainder of this capital is at present being considered in the context of the development of a longer-term plan for large national science facilities and of a review of Research Council infrastructure priorities, both of which are being led by Dr John Taylor, DGRC with the full involvement of the Research Councils. It is expected that the remaining capital will be allocated during the first quarter of 2001. This capital becomes available in 2002-03 and 2003-04.

Issue 6—How do the figures in table 3 in the Science Budget publication relate to the figures in table 2?

  Table 2 shows the Science Budget (baseline plus allocations of SR2000 additions to the Science Budget) disaggregated by Councils and main activity. Table 3 sets out the Science Budget, HEFCE and Wellcome Trust contributions to the £1 billion Science Research Investment Fund (SRIF). The reference to the Science Research Infrastructure Fund in table 2 is a reference to the first of the four funding streams described in paragraph 3.4 above. It equates to the second line of figures in table 3.

  The third line in table 3 (total £100 million) is made up of contributions from several lines in table 2. The main component is the £68 million shown in the line entitled "Capital (not yet allocated)". This is the same £68 million as described in the previous section. The remaining £32 million is not split out in table 2. It was allocated to the Medical Research Council (MRC), the Biotechnology and Biological Sciences Research Council (BBSRC) and the Natural Environment Research Council (NERC) and is included in these Councils' individual allocations tables on pages 17 (MRC—£12 million), (BBSRC—£10 million) and 21 (NERC—£10 million).

February 2001

1   Memorandum submitted to the House of Commons Science and Technology Committee by the Office of Science and Technology in June 2000. Printed in HC466-iv, Session 1999-2000. Back

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