Examination of Witnesses (Questions 100-119)
WEDNESDAY 5 FEBRUARY 2003
PROFESSOR EBRAHIM
MAMDANI, PROFESSOR
IAN W. MARSHALL
AND PROFESSOR
MARTYN THOMAS
Chairman
100. You heard the previous questions and we
have to ask your view about dissipation and overheads being paid
and grants from the Government, what is your thinking about that?
What would you do to equalise it and make more people participate?
(Professor Mamdani) There was general agreement amongst
the Fellows that the overheads were low and I think there is unanimous
agreement from all our other colleagues that something needs to
be done about the overheads. I will give you the example of one
little exercise I did once at the university I was at. We tried
comparing additional funding costs with full funding costs, 100%
or 50%, 100% with 20% overheads and 50% with full funding and
it works out exactly the same. So there is not much advantage
in going for additional funding as opposed to going for full funding.
If you were to raise the 20% for the universities you will have
to also look at the 50% support in the other cases. Most industries
do not actually succeed in getting 50% returns.
101. I seem to remember there were ways of doing
that within the university structure without it costing them one
penny, getting the overhead money in there from another source.
(Professor Mamdani) I have no experience of that.
Most of the people I know about would go for 20% funded EU contracts
as an additional part of their total research portfolio. If you
put all your research effort into European funding it will become
marginal and it will become difficult to get all of the returns
you want and it will not cover your costs. You have to make it
as part of your total portfolio, a smaller part, so that you are
getting strategic value.
102. You overcharge the EU, do you?
(Professor Mamdani) No. I do not think anybody overcharges,
you are getting money from other funds which you are using to
compensate.
103. What check is there on that when they assess
your project? How do they assess you are not putting in some deadringers,
as it were, technicians who are already there?
(Professor Mamdani) They are allowed to come and audit
you.
104. I see heads nodding in the audience, I
have been through this and was shown quite clearly how to do it.
I feel absolutely guilty and I will have to declare it now in
the members' register of interests, it was a skill of creative
accountancy that you learned how to handle a way of getting this
extra money.
(Professor Mamdani) I was involved in a project that
was audited 5 years after.
105. Who audited it?
(Professor Mamdani) The European Commission sent British
auditors to audit all our costs, it was a 50% project so all of
the overheads we put in had to be calculated.
106. In your experience was anybody caught out?
(Professor Mamdani) Some universities had to pay the
money back. In my case it just happened that we were modest with
what we charged and we were given extra money by the Commission,
we had not charged enough!
107. I thought you were a devious man. What
about the United Kingdom grant system, research councils and others,
what do you feel about them participating in some way in making
up the ground, the leeway?
(Professor Mamdani) I do not know whether the rules
would allow that. That would be very useful. If will affect their
funds, which are short anyway. Their problem would be, if they
are required to make up a deficiency they will use up all of their
funds.
108. Okay. Do you have any advice as to how
we could change Framework 7, for example, would you like it to
be coming in?
(Professor Mamdani) We have not gained enough experience
of Framework 6 yet, it is going to be a difficult one. We can
only talk about Framework 7 after we have gained the experience
from Framework 6.
109. Will you have any input into what is funded
in Framework 7 in terms of subject areas? Who do you understand
makes those decisions?
(Professor Mamdani) The only part of the process which
is not so transparent is how the priority areas are decided, once
the priority areas are decided the whole process is very transparent,
people are invited to go and contribute to the details in the
priority areas.
Dr Iddon
110. Professor Marshall, in the Institute of
Physics memorandum on page 4 it states that the Commission has
been open to lobbying from powerful academic industries and the
governments of participating Member States, what impact do you
think this has had on the priorities selected from the Framework
programme and do those match the priorities that the United Kingdom
would have selected?
(Professor Marshall) I think it is quite clear that
the priorities do not match the priorities selected by the United
Kingdom. The process for selecting them is a long and torturous
and as with most European processes it is to some extent based
on consensus and to some extent based on things going on behind
closed doors that one does not see terribly clearly. The debate
amongst practitioners is how much of what goes on behind closed
door is heavily influenced by the great and the good or by people
who are extremely powerful and large industries. It is not obvious
from the material that is published that there is undue influence
on the part of large companies, like Phillips from Holland, or
there is undue influence in favour of France as opposed to Germany
or the United Kingdom. There is evidence that some United Kingdom
specific agendas or some agendas that are more important to the
United Kingdom than elsewhere do not get prioritised or the priority
gets scheduled late and that other areas which favour other people
get scheduled early, but there does not seem to be any consistent
pattern to that. It would be difficult to say that somebody is
going to have undue influence, the problem is that the process
is not completely transparent so you cannot say it is completely
fair, so people will say, maybe it was not fair.
111. By implication you are suggesting that
the British Government, British scientists and the British industry
are not lobbying enough. Do you think they should do more and
in what way would you influence Framework Programme 7?
(Professor Marshall) I certainly think it is quite
possible that people could do more. The process, as I understand
it, is that practitioners contribute to the process through consultation,
something that the EU have, and governments contribute through
national bodies, and in the United Kingdom it is the DTI, those
national bodies take people from industry and universities, and
so on and so forth. I would hesitate to say that the DTI representation
is less strong than it should be, I have no evidence to say that
it is. What I would say is that the United Kingdom representation
in consultation meetings could be stronger, that is just a question
of more practitioners in the United Kingdom taking more of an
interest and being more prepared to go get the money. I think
one of the reasons that they do not highlight some of the weaknesses
of the Framework Programme—which perhaps I wanted to talk
about a little bit, if I could.
Chairman
112. Yes, please.
(Professor Marshall) the Framework programme is a
very good mechanism for funding certain kinds of research, it
is very good for funding standards based research that leads to
things like the GSM or ATM, it is very good for funding expensive
research and it is pretty good for developing the kind of broad
based collaboration that Mike Beveridge was talking about. It
is very poor for doing the focused, small-scale innovation that
British universities are good at because that is what the United
Kingdom research councils are good at funding. I think because
there is this big difference in the style of research of the two
mechanisms the people in the United Kingdom universities, who
are used to doing small focused innovation that go to a small
spin-off company, tend to focus on United Kingdom council funding
research and only go for the European research money, when they
have to. As a result they do not play as full a role in the European
process as perhaps they could.
Dr Iddon
113. We went from 15 to 27 in this country,
how is that going to impact on the priority chosen for Framework
programmes, do you think?
(Professor Marshall) I suspect it is going to make
the process more long-winded and more woolly and there are risks
in that. One of the problems with the priorities is they tend
to be determined well before the call for research is announced.
In the case of the first call for Framework 6 the priorities are
essentially things that were decided a year ago after a debate
that went on 18 months to two years ago, the things in the fourth
call will still be based on that same debate, so in on 3 years'
time you will still be working to the priorities that people were
coming up to 18 months ago, that in itself militates against the
research hitting the most topical issue in the most favourable
way. If one goes for enlargement it simply means that that process
will take longer and you will be doing research based on priorities
which are even further back in time. It would seem to me that
maybe one should think about having a less rigid schedule based
on the priorities and allowing the priorities in the programme
to evolve over time and that would ameliorate that risk.
Dr Iddon: A lack of topicality and a lack of
urgency.
Mr Key
114. Could I concentrate on the process in Brussels,
is the process of prioritising and the decision on grant making
sufficiently accountable and transparent for British scientists
to have full confidence in that process?
(Professor Marshall) Clearly not, since the response
we got suggested that the people felt there might be some strings
being pulled behind closed doors. There is a need for it to be
more transparent, whether what means there is a need for a change
in the way the process is run is a separate question. I have already
commented that I think it should be run in a more timely manner.
The second part of your question was really, is the process of
allocating grants sufficiently transparent for people to have
confidence in it? The answer to that on the response we got is
clearly no. There is a perception that the approval process and
the evaluation process is, to some extent, political and the decisions
are made on the basis of, have you got partners from a good deal
of European countries and are you addressing a European political
objective. Some of the evaluators are not necessarily the best
people to be doing the projects with, the quality of the some
of comments is the highly variable and in some cases highly suspect.
There are certainly improvements that could be made in the evaluation
process, although I have to say there are improvements that could
be made in the evaluation process in the United Kingdom too. It
is not clear that Europe is significantly worse at evaluation
that anywhere else, the biggest problem is it is less transparent
than the United Kingdom process.
115. Even if the evaluation process is satisfactorily
transparent and accountable the Commissioner has advisers and
even if a project meets all the criteria then I understand there
is some doubt about the role of the Commissioner. I have certainly
been told that the concern amongst United Kingdom scientists is
the apparent non-accountability of the Commissioner's actions
and he can make unilateral decisions without publicising any reasons
and indeed even if they do not follow the recommendations of the
advisory committee. Have you heard that?
(Professor Marshall) Yes. They are certainly able
to make decisions at the margins, for a thematic area there will
be an evaluation and it will evaluate the projects. The projects
that come highest in that evaluation have to be funded, but there
is horse trading about the projects that are on the boundary,
which ones to fund and which ones not to fund. Those decisions
are not purely made on the basis of is this one better than that
one, it would be unfair if they were because the levelling between
the areas is not exact. That greyness at the boundary does give
the project officers a certain freedom of movement to push their
own agenda, but actually knowing them I doubt it is very common
that they are really pushing their own agenda because they are
genuinely trying to do the best for Europe but they have rather
more freedom to move than the programme managers in the EPSRC,
purely because the programme is bigger.
Chairman: Yes.
Dr Turner
116. Your evidence suggests that the Joint Research
Council is an under-used resource rather than a fundamentally
inefficient body and that it is designed to be independent from
national commercial interests, is the United Kingdom making the
most of the JRC and if not, what can you do?
(Professor Marshall) That is slightly difficult for
me to answer, it is not very clear who is making use of the JRC
and whether the JRC is delivering value for money because it is
not quite clear what they are delivering and to whom.
Chairman
117. What does it do all day with itself?
(Professor Marshall) There are a whole bunch of people
in the JRC who are doing stuff, some of which from the outside
look rather boring, old hat, and some of which looks reasonable.
It is very difficult to judge given that one does not really know
what questions were being asked and what the answers are going
to be. The views that we got that went into the submission were
quite varied, there were people who really felt the JRC was really
rather a waste of time and there were people who thought, this
is a good idea but we are spending rather more on it than we are
getting value, maybe we should be asking them more questions and
ask them to deliver more for the budget they have. There were
people whose view was that the staff were too entrenched and it
was too hard to turn off old agendas and there was a lot of activity
not very well directed. There were people who said this is a good
thing and we want more of it. It is very difficult to put forward
a coherent recommendation based on such diverse views. The feeling
I got was there is clearly need for a review of the JRC and there
is scope for significant improvement.
Mr Dhanda
118. Professor Thomas, in your memorandum you
made a comparison between industry and the universities and the
industries inability to draw down European funding in comparison
to the universities, what would you say the reasons for that are?
(Professor Thomas) I do not know that it is inability,
it may be lack of desire. The universities go looking for money
where it is available and they fight very hard for it and they
are very good as playing the game. The RAE has trained the universities
extremely effectively to really seek out agendas, they are bright
people and they work hard at making sure they get a good amount
of money out of whatever money is available. The evidence shows
they are very successful at doing it. Over the period of the Framework
programme the major United Kingdom industry in our area, in the
electronics area, is closing down its main research labs in the
United Kingdom. We have had the establishment of other research
labs but overall the industrial research base in the United Kingdom
has probably declined in large industry, so it is not very surprising
that the big industry in the United Kingdom is not winning as
much as perhaps big industry elsewhere for that reason. Small
industry, SMEs in the United Kingdom is another picture again,
it is actually quite difficult for an SME to break into winning
European research funding for a variety of reasons that we can
go into, and much of which you heard in evidence already today,
again there is a big difference between whether an SME in a particular
area wants European money and whether it does not. Service based
SMEs like the software industry, the service side of the software
industry, software houses, are not interested in the main in winning
that kind of money because it is simply not an effective way of
using skilled staff. Your return is too low, so marginal that
the contribution of your overheads is too small and you will run
out of cash if you play too much of that game. If you are product
based, and you are intending to do substantial R&D on your
own anyway, then the contribution you get from a targeted European
research programme might be enough to compensate for the added
difficulties with IPRs and the collaboration meetings that you
have to go to and the slight adjustment to your research agenda
you have to make in order to get into the programme. Putting the
management effort into bidding for it on a one in ten chance of
winning a programme is enough to frighten any sensible SME away
from bidding. So you would not expect to be getting a high input
from the entrepreneurial SMEs in the United Kingdom that are perhaps
the people you would be hoping are in there. It is a complex picture
but the net of it is that the universities are likely to better
at it than industry and I think that is the way that you would
expect it to be.
119. If there is one thing the United Kingdom
Government could do or the European Commission could do to encourage
greater investment what would it be?
(Professor Thomas) From the SME side you have to de-risk
the process. The single thing that would probably encourage SMEs
to get in there is if there was funding for consultancy support
developing bids, that would take a lot of the risk out, particularly
for people who do not know the ropes; they would simply be able
to buy in somebody who really understood the European circuit,
who could go and talk to the people in the Commission on their
behalf and find out what the draft work programmes were, go and
establish some contact with a consortium they might get involved
with in order to take some of the management load off the SME's
own manager. For any SME, its most valuable resource is its management
time, you simply cannot afford to have your senior managers diverted
into work that is likely to waste time. That is the one thing
that I think would help SMEs enormously.
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