Select Committee on Science and Technology Appendices to the Minutes of Evidence


Letter from John Connolly, Policy and Public Affairs Officer, NESTA, to the Clerk of the Committee

  I am writing in response to your request for some further information from NESTA, relating to our investment in IT resources and agency staff.

  In the year to the end of March 2001—the most recent period for which we have audited accounts—NESTA was still at an early stage of its development. We were still setting up as an organisation, moving into new offices and establishing systems. As such, there were a large number of one-off set up costs incurred by the organisation. These are reflected in a number of areas in the accounts for that year, including the two which you have asked for further information on.

  In the year to March 2001, NESTA invested substantial resources in setting up a high-quality IT system. This has enabled us, for example, to deliver a completely electronic applications procedure for our Invention and Innovation programme, and has saved substantial sums in the long term by reducing the amount of time needed to deal with applications. This approach has been cost-effective, and has also gained us plaudits: we have won a Vision 100 award, sponsored by BT, Management Today, Sunday Business, and the Cranfield School of Management. These awards celebrate visionary companies, and we won an award for pioneering electronic business methods. Our electronic applications process has also been cited as an example of best practice in the recent DCMS consultation exercise on the future of Lottery Distribution policy. These achievements would not have been possible without substantial up-front investment.

  As much of the set-up work for our IT system was of a one-off nature, it was more effective to have it carried out by agency staff. This was also true of a number of other set-up activities, resuting in relatively high expenditure on agency staff in this financial year. In adition, as a small organisation, we find it more cost-effective on an ongoing basis to deal with short-term increases in workload by taking on a small number of agency staff, rather than employing permanent members of staff to deal with a short-term need.

  We do not yet have audited accounts for the financial year to 31 March 2002. However, we expect that they will show a substantial reduction in the sum spent by NESTA on these areas.

26 September 2002


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