Select Committee on Science and Technology Third Report


3  Promoting knowledge transfer

Introduction

13. Publicly-funded support for innovation is managed through a number of organisations and bodies and via numerous different schemes. We sought to examine the Research Councils' role in supporting knowledge transfer and the effectiveness of their efforts to do so.

Government support for knowledge transfer

14. There is widespread support for Government activity to fund and promote knowledge transfer. For example, AstraZeneca told us that "the value of the total research investment made by the OST [Office of Science and Technology] will not be realised unless KT [knowledge transfer] is highly promoted, rigorously pursued and adequately funded".[25]

15. The Government told us that "Research Council activity needs to be seen in the wider context of a range of Government support for innovation".[26] Main support routes for Government funded knowledge transfer are shown in Figure 1 and include:

A  Investment through the Department for Education and Skills (DfES) and Higher Education Funding Council for England (HEFCE) to the Higher Education Innovation Fund (HEIF), which supports higher education institutions (HEIs) in knowledge exchange and productive interactions with business, public sector organisations and the wider community[27] The DfES HEIF contribution is approximately £20 million for 2005/06.[28]

B  Investment through the DTI and OSI to:

i.  Contribute toward the HEIF fund.[29]?DTI expenditure on HEIF is approximately £60 million for 2005/2006;[30]

ii.   Support Research Council knowledge transfer activities. The Government awarded over £7.5 million of the science budget knowledge transfer allocation for supporting Research Council's knowledge transfer activities;[31]

iii.  Support knowledge transfer from Public Sector Research Establishments (PSRE) through the PSRE fund.[32] ?The PSRE fund was worth approximately £10 million in 2005/2006;[33] Provide funding to the DTI technology programme (overseen by the Technology Strategy Board) to support business-relevant collaborative R&D programmes and knowledge transfer networks.[34] The? Technology Strategy Board has been allocated £320 million for three years (2005 - 2008);[35] and

iv.  Give support to Regional Development Agencies (RDAs) for promotion of business innovation as part of their Regional Economic Strategies. Investment in regional science and innovation by RDAs will reach £360 million in 2005-06.[36]


Figure 1

16. Other Government mechanisms to support innovation include: tax credits for large and small businesses (R&D contracted out to universities is eligible for tax credit, thus reducing the net cost to businesses); the Science Research Infrastructure Fund (SRIF3) which awards research capital funding on condition that HEIs develop greater access to facilities for business; innovation support schemes e.g. Knowledge Transfer Partnerships and Global Watch. Support is also given to "Science Cities", a concept designed to bring together Government, universities and industry at a local level and Government-supported venture capital measures e.g. Enterprise Capital Funds.[37] The UK also accesses funding in support of knowledge transfer and innovation from the European Union's Framework Programme.[38]

Role of the Research Councils

17. The Research Councils are the main public investors in fundamental research in the UK and manage a significant proportion of the knowledge transfer budget. Although their main role is to fund research on the basis of excellence and research training, they recognise that they have a "distinctive role to play in ensuring that research outcomes are fully exploited, to maximise the effect of successive increases in Science Budget funding for research activities".[39]

18. We found good consensus that the Research Councils have a role in promoting knowledge transfer. QinetiQ said that "the RCs [Research Councils] should be made fully accountable for generating and adding value to integrated portfolios of research that either advance the frontiers of purer science and knowledge or enhance national competitiveness through business".[40] We also heard from Professor Diana Green, representing Universities UK, that "it is entirely right and proper that the Research Councils should be concerned about the practical applications of the research that we are all being funded for".[41] However, we also heard from Dr Ian Ritchie who said that the "Research Councils ought to concentrate on what they do best, which is getting excellent research in the UK".[42]

19. Professor Sir Keith O'Nions approved of a fundamental role for the Research Councils in supporting knowledge transfer, telling us that although the "central role for Research Councils is the creation of new knowledge in universities and in research institutes", they also have an important role in supporting knowledge transfer.[43] Furthermore, Sir Keith told us that all major sources of knowledge transfer funding "have a very important role to play" since "if one does not play the game, the efforts of another may be somewhat reduced in its effectiveness".[ 44] The Research Councils have an important role to play in adding value to the research supported across the UK and we welcome the Research Councils' commitment to support knowledge transfer.

Co-ordination of UK support for knowledge transfer

20. Although there are many sources of funding for knowledge transfer across the UK, the co-ordination between them has been questioned. Professor Snowden, Vice Chancellor of the University of Surrey, told us of "a high degree of disconnect between the very many different groups involved [in knowledge transfer]"[45] and we heard from the Institute of Physics of the importance that "all publicly-funded research reflects a coherent national strategy, rather than the fragmented set of strategies that we have at present".[46] The Confederation for British Industry (CBI) also told us of "concerns over the nature of the UK's approach to public support for science, R&D and innovation, particularly the fact that it is characterised by this high number of small schemes each distributing a small portion of the pot".[47] It believes that the Government should "investigate opportunities for merging funding schemes operated by the major funders of the research base (including the Research Councils) around agreed national priorities".[48] Criticism of UK co-ordination in Research and Development is not new. The House of Lords Science and Technology Select Committee previously recommended that "the Government should establish a forum for the Office of Science and Technology (including the Research Councils), Regional Development Agencies (RDAs) and other key players, that meets regularly to address the impact of and synergy between national and regional SET [Science, Engineering and Technology] investments and, as far as possible, harmonise them".[49]

21. There were specific complaints with regard to co-ordination between RDAs and Research Councils. The Lambert review emphasised that regional links between business and academia were important for promoting innovation".[50] RDAs are therefore increasing their support of business innovation as part of their Regional Economic Strategies, and have received significant levels of funding toward their science and technology activities (£360 million over 2005-06).[51] Within the Research Councils there is good understanding of UK research strengths, whilst RDAs have expertise in regional business strengths and requirements. We agree with Professor Diana Green, Vice Chancellor of Sheffield Hallam University, that "there is a great opportunity for some joined up thinking".[52]

22. Professor Murphy, from BAe Systems and Chair of the External Challenge Panel, claimed that there is a general lack of expertise in knowledge transfer within RDAs. He told us that "for historical reasons, the Research Councils have evolved a very strong knowledge base, which the RDAs do not have".[53] The Campaign for Science and Engineering (CaSE) agreed, telling us that "some of the Regional Development Agencies […] have clearly not yet fully understood their role in supporting the process of generating wealth from research"[54] GlaxoSmithKline (GSK) took this view a step further, saying that "current arrangements for the promotion of knowledge transfer by the Regional Development Agencies (RDAs) are not satisfactory" and that "there are real opportunities for the Research Councils to take a lead here".[55] Criticism of RDA expertise is not new to this inquiry. Indeed, we also have previously commented upon the "patchy nature of scientific expertise in RDAs".[56]

23. The Research Councils were not concerned about their levels of engagement with RDAs, displaying a general acceptance of the situation. During his evidence, Professor O'Nions told us that "RDAs come in different shapes and sizes [and that] they have different amounts of money to invest".[57] Professor Ian Diamond, Chief Executive of ESRC and current chair of the RCUK executive group, told us that because there is "a rich diversity amongst the RDAs"[58] one might "expect the degree of interaction with RDAs to be quite variable".[59] Professor Diamond did, however, acknowledge the "enormous scope for a lot more to be done in the regions"[60] and that the Research Councils "really have to identify improved ways of working with the RDAs in this area".[61]

24. We agree that there is variation in RDA capacity and expertise. However, we were disappointed not to obtain a clear view of how the Research Councils intend to enhance co-ordination with the RDAs or how they might benefit from each others knowledge or experience. Momenta, a division of the innovation business AEA Technology plc, told us of "the very low awareness in industry […] of what knowledge is being generated by the research base and how it might be exploited to competitive advantage of companies".[62]. Since the Research Councils possess good understanding of the research base and of the knowledge created, they could consider sharing this information to help RDAs to build a knowledge base of the expertise within their regions. For example, this could follow a similar line to Yorkshire Forward who, in attempts to increase knowledge transfer within the Yorkshire and Humber region, recently launched KnowledgeRICH, an online and telephone service designed to bring businesses requiring input into products or problems and academia together.

25. We are not convinced that measures put in place to facilitate national co-ordination of knowledge transfer are sufficient and we believe that there is a need for co-ordination between all UK funders of knowledge transfer to be enhanced. We recommend that the Government takes the necessary steps to ensure a co-ordinated knowledge transfer strategy. We recommend that the Research Councils lead the development of a strategy through which engagement between all organisations currently involved in support of knowledge transfer can be enhanced. We consider that there is a particular need for increased engagement between RDAs and the Research Councils. We call on the Research Councils to develop effective working relationships with all RDAs, strengthening links where necessary, disseminating good practice and supporting RDAs in building up their expertise.


25   Ev 100 Back

26   Ev 49 Back

27   HEFCE, Higher Education Innovation Fund, www.hefce.ac.uk/reachout/heif/ Back

28   OST, OST: Knowledge transfer/exploitation funding, 2006 Back

29   DTI, Science Budget Allocations2005-06 to 2007-08 Back

30   DTI, Departmental Report, 2005, Annex B, Table B1: Request for Resources 2, p 195. Back

31   DTI, Science Budget Allocations2005-06 to 2007-08 Back

32   As above Back

33   DTI, Departmental Report, 2005, Annex B, Table B1: Request for Resources 2, p 195 Back

34   DTI, DTI Technology Programme, www.dti.gov.uk/innovation/tech-priorities-uk/about_the_programme/index.html Back

35   DTI, Succeeding through innovation, November 2005 Back

36   HM Treasury, Department of Trade and Industry and Department for Education and Skills, The ten-year Science & Innovation Investment Framework Annual Report 2005, chapter 2, para 2.7 Back

37   Ev 51 Back

38   Ev 52 Back

39   HM Treasury, Department of Trade and Industry and Department for Education and Skills, Science and Innovation Investment Framework 2004-2014, chapter 5, para 5.32 Back

40   Ev 134 Back

41   Q 67 Back

42   Q 153 Back

43   Q 3 Back

44   Q 5 Back

45   Q 69 Back

46   Ev 125 Back

47   Q 175 Back

48   Ev 134 Back

49   House of Lords, Science and the RDAs SETting the regional agenda, Fifth Report of the Select Committee on Science and Technology, Session 2002-03, HL Paper 140-I Back

50   Richard Lambert, Lambert Review of Business-University collaboration, Introduction Back

51   Ev 51 Back

52   Q 69 Back

53   Q 122 Back

54   Ev 121 Back

55   Ev 117 Back

56   Fifth Report from the Science and Technology Select Committee, Session 2003-04,Too little too late? Government Investment in Nanotechnology, HC 56-I, p 71 Back

57   Q 25 Back

58   Q 221 Back

59   Q 25 Back

60   As above Back

61   Q 221 Back

62   Ev 123 Back


 
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Prepared 15 June 2006