Examination of Witnesses (Questions 20-39)
LORD PUTTNAM OF QUEENSGATE, MR JEREMY NEWTON AND MR MIKE TOMLINSON
MONDAY 8 JULY 2002
Dr Brian Iddon
20. I represent a north-west constituency. Can you say something about the regional distribution of all your funds: are they concentrated in the City of London, or do they get out to all the extremities of the country?
(Lord Puttnam) There are two answers. One is a healthy and one is a worrying. The healthy one is that we have done well in many of the regions. We have also done spectacularly badly in one or two regions, and this is one of the reasons why we have approached the Department about using talent scouts, where, frankly, there is a serious problem. We have already trialed it. We have someone in the north-west, Ruth Turner, who has been working for us for a year now, literally seeking out on the ground the areas of low-cost intervention that we think could best help. She was originally the founder of the Big Issue in the north. She had done a wonderful job for us. One of the things we have asked the Department for is the ability to replicate what she is doing in other parts of the country.
(Mr Newton) We were disappointed by the East Midlands and early on we were disappointed about the north-west, but Ruth has made a major difference thereand there is no doubt about it. We are very pleased by the return in Scotland, but Wales and Northern Ireland have been less active in putting together good proposals. We are working particularly with Northern Ireland at the moment on developing some ideas for education projects.
(Lord Puttnam) This is a two-way issue. We have tried very hardand I have written twice to every single RDA chair to point out what we are trying to do and the kind of support and help we need to be able to engage with them. Some have been magnificent; some have not even bothered to reply.
21. Do you have a list of those people? Have you a blacklist that you are prepared to give us, because MPs are in a position to chase RDA chairs?
(Lord Puttnam) Chairman, I would much rather give you the "magnificent" list, but if you press me I will give you both.
22. We would like to see it. I think that we would find it quite valuable, in terms of being helpful.
(Lord Puttnam) It is an area in which we have been very proactive. As I say, in some cases the rewards have been significant and in some caseswere I living in those regions, I would think it lamentable.
23. My understanding is that your business plan for 2001/2002 committed £8 million to invention and innovation awards and fellowships. Did you spend that money?
(Mr Newton) Yes, we slightly over committed in that year and it ended up being £8.2 million, the total awards committed in that year.
24. It does give the impression that you have been quite slow in getting going because in your evidence you spent £9.5 million to the end of May 2002, but £8.2 million of that was in one financial year, so in the first year you only spent about £1 million. Is that right?
(Lord Puttnam) We spent a very small sum of money on what we termed at the time "experimental projects". We were really testing our systems. They were projects that were available to us, but it was a systems test. I make no apology for that. I have had very bad experiences of start-up organisations, and in fact I had one quite recently, which attempt to hit the ground running when they were just not ready to do so. I take all responsibility and blame for this. I was determined it would not happen in the case of NESTA.
25. You went live in November 1999 and between then and the middle of 2001 you spent £1 million. That just seems very, very slow, and overly cautious, rather than rash.
(Lord Puttnam) I do not think those figures are right. I do not have to hand the year-by-year figures. I would be happy to submit those.
26. This is based on the evidence you have given, both oral and written.
(Lord Puttnam) Let me be very clear that I take all responsibility for this. We live in an extremely difficult environment. It is the easiest thing in the world to discredit a young organisation in its early months. We only needed one story in the media that we were mis-spending the money, misusing the money, or spending it on something frivolous; and, frankly, it would have done immense damage from which NESTA might never have recovered. It seems to me that I made absolutely the right judgment, and I stand by it.
27. Notwithstanding the fact that this Committee in its second report, session 1998-1999, stated that NESTA should be prepared to take chances and risks. "It must dare to fail on specific projects." Are you now telling us that you dare not fail on specific projects?
(Lord Puttnam) No, I am saying that in the past two years we have absolutely spent up on the sums of money available to us and we have taken some significant chances; and I am quite sure that we will fall on our faces on one or two occasions; but I now think that we have enough of a track record now to be able to deal with that. I was less confident that was the case two years ago.
(Mr Newton) The £1 million figure was in 1999-2000. In 2000 and 2001 there was something like £5 million committed to awards and then £8 million in 2001-2002£14 million so far in terms of the three programmes.
28. We have some figures on this and you also need to reconcile back to the table on page 11 of your submission, which states that awards to April 2002 are 9.5 million, which is not quite correct.
(Mr Newton) That is 9.5 across fellowships and invention and innovation, and then 4.5 on education. That is about 14 million across the three programmes.
29. My understanding is that your business plan 2002-2002you spent 8 million on invention and innovation awards and fellowships together.
(Mr Newton) And education. The figure definitely was spread across all three.
30. Have you published your business plan for 2002-2003?
(Mr Newton) It exists and can certainly be made available.
(Lord Puttnam) It is awaiting approval at the next trustees' meeting.
31. Do you monitor the proportion of your awards that goes to academics and non-academics?
(Lord Puttnam) In those terms, no.
32. How do you know you are looking beyond academia and universities and their confines, because they seem to get quite a lot of grants as it is? There are those people who do not have access to this funding stream that you need to be helping.
(Lord Puttnam) I would not know how to clearly define an academic from a non-academic. What is absolutely certain is that we stretch out and make every effort to give awards to people who would not normally get them under any of the existing award granting bodies, particularly the big ones. We try to stretch out in areas that they do not cover. There are a number of these bodies. I am on the A.H.R.B award-granting body, so I am very conscious of the decisions they make and the criteria they set. We certainly work well outside of those criteria.
(Mr Newton) It is certainly a small minority of fellowships and invention and innovation awards that find their way to institutional-based academics, university-based academics. Most are outside the university sector.
33. The Royal Academy of Engineering was clearly concerned that they know nothing about you. The Royal Academy of Engineering has strong links not just with universities but with industry of all sizes. It seems to me sensible that you should ask an organisation like the RAE where it thinks innovations might spring from, and that might broaden your base.
(Lord Puttnam) I think we have engaged with all the learned bodies and all the bodies that we believe we can engage with, to make absolutely sure our message gets across. There is no point in going into it because they all have different views, but the engineering world is particularly complicated. As I said earlier, I think that the Government has done exactly the right thing in knocking their heads and pulling them together. We found them in our early years extremely difficult to deal with.
34. Do you separate out what you spend on the arts, technology and sciences?
(Lord Puttnam) Budgetarily?
(Lord Puttnam) We try very hard not to; because we believe that could lead us into making a series of wrong decisions, so we try very, very hard not to make decisions on that basis, certainly quarter-to-quarter.
36. Presumably, you record the grants you have given in those categories.
(Lord Puttnam) Yes, we monitor very closely, but not in a category sense.
37. We will be asking you some specific questions about the financing of these years.
(Lord Puttnam) Mr Spink's question is a troubling one and it is one I am not wholly comfortable with, either our answer or where we are. Are we risking enough? It is a question we ask ourselves all the time, and we are trying to keep a balance betweendare I use the wordprudence on the one hand and risk on the other. There is a point at which you can be ridiculed for not being sufficiently prudent with public money; but equally there is a point, which is what I think Mr Spink is referring to, where you can be criticised for not taking enough chances. I am not entirely convinced we are taking enough chances, but I would like to think we are creating an environment in which we are increasingly prepared to.
38. Your business is to court risk; you have been set up to do that. There are other bodies that can play safe. I am sure that Parliament and other people would protect you from unfair criticism if you fairly chanced your arm and took risks. That is what you are about, is it not? We are rather surprised to hear your initial cautious stance. Which of the engineering bodies do you find "very difficult to deal with"?
(Lord Puttnam) We found the engineering bodies themselves, as a group of bodiesand bear in mind there are quite a number of themquite difficult to deal with because there is a lack of clarity between them as to who is responsible for what. We are hopingand Jeremy is trying very hard indeedto create a very good relationship with the new engineering body. I am very lucky: Sir Peter Williams, the new Chair, is an old colleague and a personal friend, so we start from a base that is workable. As we all know, candidly, there is a tremendous sense of "not invented here" that permeates all of these areas of our society. We found it
39. As an engineer, I can guarantee that that is the case.
(Lord Puttnam) Thank you.
Dr Murrison: Can I focus on some outcomes and also perhaps some opportunity costs. Richard Morrison in The Times on June 29, 2001, wrote a rather disobliging article, I think you would probably say. Remember that this is now a year ago. In his final paragraph he said: "For the moment, then, I have banned cynicism about NESTA from this column, if not from the world at large. But the organisation must start to deliver success stories soon. As the dismal recent history of the British film industry proves, it is all too easy to invest a sackful of Lottery money and good intentions in 'promising talents', sit back and wait for gloryand end up with a hundred duds, each one sinking with a more embarrassing gurgle than the one before."