House of Commons - Science and Technology

Select Committee on Science and Technology Written Evidence

APPENDIX 2

Memorandum from Research Councils UK (RCUK)

CONSULTATION BY HOUSE OF COMMONS SCIENCE AND TECHNOLOGY COMMITTEE ON RESEARCH COUNCIL SUPPORT FOR KNOWLEDGE TRANSFER

Research Councils UK (RCUK) is a strategic partnership that champions the research supported by the eight UK Research Councils. Through RCUK the Research Councils are creating a common framework for research, training and knowledge transfer. Further details are available at www.rcuk.ac.uk.

RCUK welcomes the opportunity to respond to this consultation from House of Commons Science and Technology Committee[1]

This memorandum provides evidence from RCUK in response to the main topics and questions identified in the consultation document, in addition to supplementary views from:

Arts & Humanities Research Council Annex One

Biotechnology and Biological Sciences Research Council Annex Two

Council for the Central Laboratory of the Research Councils Annex Three

Engineering and Physical Sciences Research Council Annex Four

Economic and Social Research Council Annex Five

Medical Research Council Annex Six

Natural Environment Research Council Annex Seven

Particle Physics and Astronomy Research Council Annex Eight

Selected highlights of the impact of knowledge transferred from Research Councils' programmes:

DNA finger printing:

Satellite control:

Bioprocessing:

Terahertz Technology:

Health impacts:

— Established that smokers lose a decade of life compared to non-smokers.

— Showed that surgery for stroke can halve the risk of a subsequent one.

— Demonstrated that screening for abdominal aortic aneurysms is cost-effective, saving over 3,000 lives after four years in the 65-74 age group.

— Showed that cholesterol-lowering drugs can reduce the risks of heart attacks and strokes by at least one-third.

Antibody technology:

Economics:

Better livestock transport:

Thames Barrier:

The arts:

Development of Lagan Weir:

ROLE OF RESEARCH COUNCILS IN DELIVERING GOVERNMENT INNOVATION OBJECTIVES

1. The Government's vision for science and innovation is that the UK should be one of the most attractive locations in the world for science and innovation, being a key knowledge hub in the global economy, with a reputation not only for outstanding scientific and technical discovery, but also a world leader at turning that knowledge into new products and services.

2. Research outputs, training and sources of new knowledge and technology are the raw materials which power successful innovation. The Government recognises that substantial investments in basic research are needed to generate this knowledge, partnered with investment to strengthen links with business and drive innovation, which will in turn increase UK productivity and attract more inward investment into the UK. This is reflected in the DTI's Public Service Agreement Targets for the Science Budget, which are:

Output 1:

Output 2:

3. As well as support for research and training, each Research Council also has a specific knowledge transfer responsibility in their Missions. Whilst there are sector specific differences, and additional responsibilities for CCLRC, ESRC and MRC, the basic remit is to:

specified industrial sectors

4. The Research Councils are committed to playing their part in achieving the Government's objectives for innovation, working with other key players including the private sector, HEIs, RDAs and Government, to build on their successful track record in supporting knowledge transfer.

THE RANGE OF RESEARCH COUNCILS' KNOWLEDGE TRANSFER ACTIVITIES

5. Each of the Research Councils supports research and training across a wide range of academic disciplines. There is strength in the diversity of this system, with each Council providing a strong focus for their research and user communities. Consequently each Council has a varied and diverse set of stakeholders and users, ranging from large multinational companies to SMEs and from policy makers in Whitehall, the regions and in Europe to the NHS, the Met Office and museums and galleries.

6. In developing their thinking about knowledge transfer the Councils have agreed a shared definition of knowledge transfer:

"The UK Research Councils seek to accelerate the two-way flow of people and ideas between the research environment and wider economy, and thereby contribute to national prosperity, the quality of life of UK citizens, and cultural enrichment of our society. Knowledge Transfer encompasses the systems and processes by which knowledge, expertise and skilled people transfer between the research environment (universities, centres and institutes) and its user communities in industry, commerce, public and service sectors.

7. The Councils agreed to group these activities under four non-exclusive headings and to develop their plans and targets within them:

— Co-operation in education and training at masters and doctoral level.

— People and knowledge flow.

— Collaborative research with users.

— Commercialisation including IP exploitation and entrepreneurial activities".

8. In delivering their knowledge transfer responsibilities, each Council has developed strategies, processes and approaches which reflect the breadth of science and research supported, the particular characteristics of each Council's user communities and the size of the Research Council's budgets.

SUMMARY OF RESEARCH COUNCILS' SUPPORT FOR KNOWLEDGE TRANSFER

User and stakeholder engagement

9. Each of the Councils has developed their knowledge transfer strategies and approaches in consultation with their major business and research user groups. User input is sought and accessed through a wide range of mechanisms including:

— business and user representation on each governing Council;

— business or user led high-level advisory groups eg EPSRC's User Panel or BBSRC's Bioscience for Industry Panel;

— business and user membership of Councils' peer review colleges and peer review panels;

— Funders forums;

— Concordat's with Government Departments;

— regular dialogue with companies, CBI and trade associations; and

— seminars, workshops and conferences with user groups.

10. Specific challenges exist in a number of sectors. For example, the interplay between creativity and technology in the creative industries requires different knowledge transfer models than those of traditional manufacturing industries. The AHRC is leading a Task Group on Research and Knowledge Transfer within the Creative Industries/Higher Education Forum at the Department of Culture, Media and Sport. This Group seeks to identify the challenges and opportunities in knowledge transfer activities for the creative industries sector. It has facilitated the formation of strategic partnerships between the research base and creative industries and has undertaken research to identify and define appropriate models of knowledge transfer for the creative industries and the arts and humanities research base. PPARC is different again. As the areas of science it supports depend on advanced technologies, PPARC places a strong emphasis on brokering relationships with industrial sectors which act both as technology supplier for research programmes, as well as a customer for knowledge transfer. For example, in preparing for UK participation in the ESA Aurora programme of Mars exploration, PPARC held a workshop on the technical and industrial opportunities created by Aurora, and invited proposals for early stage technology studies.

Collaborative R&D

11. All of the Research Councils support collaborative R&D with a variety of users including business, charities and Government Departments. Where appropriate this enables potential end users of the research to shape the overall priorities and direction of that research and helps to ensure that the research base is responsive to the needs of the economy. As well as transferring outcomes from basic research, such collaboration with business helps to deliver new knowledge which may benefit future research and helps companies innovate and may lead to further commercial opportunities.

12. Individual Council collaborations include:

— AHRC has established a strategic R&D collaboration with BBC New Media. This collaboration brings arts and humanities researchers together with BBC staff to address R&D needs in the areas of mobile/portable interactive devices, passive consumption/active engagement; user generated content and managing media assets.

— BBSRC and EPSRC are co-funding a £10 million research programme in Bioprocessing with 18 companies who are contributing collectively £1 million. The aim is to address strategically importance research problems which underpin the efficient production of biopharmaceuticals which comprise over one third of all new drugs in development.

— EPSRC has established 17 Innovative Manufacturing Research Centres (IMRCs) representing an investment of £80 million. IMRCs are expected to attract matched funding (mostly in kind) from industry partners. The IMRCs currently collaborate with over 1,000 companies, many of them SMEs. A recent review found a high level of satisfaction for the IMRCs amongst industrial collaborators, primarily because the significant levels of long-term funding enable the development of more strategic relationships and plans, and the ability of the IMRCs to respond quickly to business needs.

— MRC and BBSRC are co-funding, with the Funding Councils and three pharmaceutical companies, a £12 million initiative in Integrative Mammalian Biology. The aim is to enhance research and training in the physiology and pharmacology of animals.

— BBSRC has recently announced (September 2005) a £11 million initiative in the area of Crop Products and Processes to bring about more effective translation of research on model species into crop plants. A further £1 million is available for research in collaboration with industry, in particular, with breeders of wheat, the most important UK crop.

— EPSRC runs the "Ideas Factory" an approach that brings together multidisciplinary teams of researchers and users for a week long "Sand-pit" to address significant business or societal challenges. Topics have included maintenance and renewal of the buried infrastructure, gun crime, closing the productivity gap and bridging the digital divide. Successful collaborative ideas which emerge from the sandpits draw down from an earmarked sum of £1 million.

— EPSRC has developed a number of strategic partnerships with companies and other organisations, to enable leading researchers to focus on user led strategic requirements. One is example is the £30 million strategic partnership between EPSRC and BAE systems which supports long-term basic research in the aerospace and defence sector.

— The collaboration between the MRC Protein Phosphorylation Unit and the University of Dundee's School of Life Sciences is £21.5 million collaboration with seven companies including GSK, AstraZenca and Pfizer. The research being funded is aimed at speeding up drug development for major diseases including diabetes and some cancers and has created 20 new scientific posts.

13. Research Council institutes also undertake a substantial volume of contract research in partnership with Government, industry and a range of other users which help to build collaborations between the private and public sectors. For example:

— CCLRC's Space Science and Technology Department (SSTD) has 80 contracts running with industry, to the value of around £6 million this financial year. This includes substantial contracts to supply instrumentation for satellites into industry, a leading example being a multi-million dollar contract from Lockheed for a NASA satellite.

— The British Geological Survey (BGS) is one of the organisations involved in monitoring and modelling the distribution of injected CO2 in the Utsira Sand. The Statoil Sleipner project was the world's first demonstration of carbon dioxide capture and underground storage. It is of great interest to the international community because if the concept can be applied to power stations it holds out the promise of making deep cuts in global CO2 emissions—without having to abandon fossil fuels. The monitoring BGS is undertaking is to check that the CO2 is behaving as predicted and is not migrating out of the intended storage site. This type of demonstration will do much to satisfy future legal verification requirements and allay public concerns about safety issues.

— Centre for Ecology and Hydrology (CEH) scientists and partners completed the biggest experiment of its kind in the world, designed to test the effects of growing Genetically Modified herbicide tolerant crops on biodiversity. The findings of this research are shaping Government policy in the UK and in Europe on decisions over commercialisation of a number of crops, and ensuring that other stakeholders, including UK industry are well informed. Scientific research of this kind is essential, particularly given the contentious nature of the debate on Genetically Modified Organisms (GMOs).

— CCLRC commercial interactions include partnership with Intel to benchmark their processors on a broad spectrum of scientific applications and with AMD to explore life science applications of their hardware. Most recently the CSED have partnered AstraZeneca in a £300K three year contract to undertake high performance computing simulations for drug formulation.

14. The Councils currently invest £40 million in the 24 Faraday partnerships. These are alliances of organisations and institutions, which can include research and technology organisations, universities, professional institutes, Trade Associations and companies. Each Faraday Partnership focuses on a technology of importance to the UK dedicated to improving the competitiveness of a specific business sector through more effective interaction between the research base and the industry. The original 24 Partnerships include more than 300 university teams and 2,500 companies. Faraday partnerships are now being developed by the DTI into the Knowledge Transfer Networks scheme as part of the Technology Programme. The first RC engagement in KTN sponsorship has just been announced.

15. The majority of Councils are, or have been co-funders of LINK programmes, the Government's principle mechanism for supporting collaborative research between UK industry and the research base, prior to the establishment of the Technology Programme. Each LINK partnership is an alliance of organisations from academia and business, and more specifically technology translators—people with broad experience of technology transfer who can facilitate projects between partner members. Examples include:

— The Ocean Margins LINK programme, co-funded by NERC, is designed to focus the research challenges facing the industry in exploring for, and developing deep-water oil fields.

— The Advanced Food Manufacturing programme, co-funded by BBSRC and EPSRC, is exploring advanced manufacturing techniques for the food industry, to allow greater process flexibility and reduced energy use and waste generation.

— EPSRC co-funded the Waste Minimisation through Recycling, Re-use & Recovery programme. This funded research into the recycling and re-use of materials within processes and plant and recovery of products and components in a wide range of processing and manufacturing sectors.

16. The Research Councils have voluntarily contributed to the Government's Small Business Research Initiative (SBRI) targets. Following an announcement in the 2005 Budget, the Research Councils will promote a Small Business Research scheme (similar to, but distinct from, SBRI). The Councils are committed to spending at least 2.5% of a baseline of £815 million in 2005-06 on university-SME collaborations. Allocations have been, and will continue to be, made throughout the year with Councils advertising funding opportunities on their individual web sites.

17. On a smaller scale, Councils also wish to encourage industry awareness and partnership in responsive mode grants. BBSRC have introduced an Industrial Partnership Award (IPA) scheme, through which all research proposals that have obtained a10% cash contribution from industry will be funded provided they reach a quality threshold.

Cooperative training and education

18. Nearly all the Research Councils run a CASE PhD studentship scheme and offer other targeted user-relevant training. Collectively the Research Councils fund some 10,000 PhD students, of whom approximately 25% move into the private sector upon completion of their PhD. This proportion varies by discipline, for example 48% of all PPARC students take employment in the private sector, including the City, major industrial companies and small IT companies.

19. Of the PhD students supported by the Councils, some 3,000 students are being trained collaboratively with industry through the CASE studentship scheme involving over 500 companies and users ranging from Reebok UK to BP to County Councils. The well-established CASE studentship scheme provides PhD students with training in both an academic and commercial or user environment. A number of Councils are also working with the RDAs to help bring these training opportunities to the attention of SMEs.

20. The Councils also support specific training initiatives such as the Biotechnology Young Entrepreneurs Scheme, which provides training in commercialisation for postgraduate and postdoctoral bioscientists. Research has shown that graduates participating in this scheme are twice as likely to take employment in the private sector as their peers, and a number have already launched their own companies.

PEOPLE AND KNOWLEDGE FLOW

21. Individuals are at the heart of knowledge transfer. All of the Councils aim to encourage increased levels of university business interaction and all support the exchange of researchers between academia and industry and broker partnerships between business and researchers. For example all fund industry fellowship (or equivalent) schemes which enable academics to undertake research in a business environment and which allow private sector researchers to undertake research or course development work in a university.

22. The Research Councils fund and promote Knowledge Transfer Partnerships (KTP) to enable collaborative partnerships between the research base and industry, particularly small and medium sized technology companies. Under the scheme high calibre graduates and postgraduates are recruited to work on innovative projects within industry and are jointly supervised by the participating industrial and academic partners. The industrial partner gains access to the latest technology and research developments, whilst the academic partner benefits from working with business on real problems and the researcher develops greater business awareness. AHRC is developing a shorter, more flexible precursor KTP aimed at small and medium sized businesses and micro enterprises.

23. Research Councils play an important role in providing knowledge to inform policy development. This is particularly important in the economic and social sciences where ESRC has strategic partnerships with ten government departments and all three devolved administrations. It is also an important component of the activities of BBSRC and NERC in providing advice on the environment and agriculture to underpin government policy. For example, the work of the BBSRC Institute of Animal Health on FMD impacted government policy on handling the foot and mouth disease outbreak. NERC is leading the field in farm scale evaluation of GM crops. The arts and humanities too make a fundamental contribution to key areas of public policy and wider public understanding. Through enhancing our understanding of ourselves and our world, the impact is felt in areas of public policy as diverse as law, ethics, media and communications, ethnicity and cultural diversity, language and language technologies, and creativity and innovation. For example AHRC is taking the lead on a new cross-Council initiative, the focus of which will be upon the theoretical and empirical knowledge of societies, cultures and identities based on ethics, religious, historical, linguistic factors and other socio-economic indicators such as demographics. By taking this approach, AHRC is ensuring that the causes of terrorism are addressed by taking account of a broad spectrum of factors, and that technology is appropriately harnessed to combat and respond to it.

24. Following SR2004 OST will be providing the Research Councils with additional funding of £20 million from 2006-07 to enable them to strengthen their delivery of their knowledge transfer activities. Of the £20 million, £5 million is earmarked for Councils to increase their knowledge transfer (KT) capacity. This is being matched with equivalent funding to the RDAs.

25. Specific Research Council activities aimed at promoting knowledge flow include:

— PPARC runs the Knowledge, Innovation, Technology and Enterprise (KITE) Club which is an active programme of brokering and networking to increase the awareness of industry and other users and the academic community of each other's strengths, needs and opportunities. This takes place through a programme of visits and workshops and supports an innovation advisory service to broker partnerships between researchers and business. Other PPARC activities include a workshop with BBSRC to link astronomers and biologists which has led to a series of collaborative projects to transfer imaging technologies into biological research.

— AHRC is launching a new national Research Exchange Network for arts and humanities researchers and knowledge transfer professionals. The Network will offer opportunities to engage and collaborate in the exchange of research knowledge within and outside academia.

— ESRC runs the CONNECT Club which facilitates social and economic research findings directly to senior policy makers in central and local government, business and financial sectors and the voluntary sector amongst others.

— Three BBSRC institutes provide bio incubator facilities, which have been developed with support from the RDAs. The bio incubator at the Babraham Institute has been particularly successful with eighteen companies on site.

— CCLRC is investing in campus development projects at its laboratories at Harwell and at Daresbury, which will offer new environments for collaborative research and people exchange. Over £50 million has been invested at the Daresbury campus by the NWDA creating 24,000 sq ft of laboratory space. To date, seventeen high technology companies have been attracted to the site with another four planned. A similar development is planned at the Rutherford Appleton Laboratory at Harwell.

26. OST will be providing the Research Councils with additional funding of £20 million from 2006-07 to enable Councils to strengthen their delivery of their knowledge transfer activities. Of the £20 million, £5 million is earmarked for Councils to increase their knowledge transfer (KT) capacity. This is being matched with equivalent funding to the RDAs.

Commercialisation

27. Research Councils delegate the responsibility for the management and commercialisation of IP arising from the research funded to the research organisation, usually an HEI. To encourage universities to build entrepreneurial environment and undertake the commercialisation of research, the Councils support an increasingly wide ranging portfolio of activities, including IP awareness training and enterprise fellowship schemes (eg BBSRC and PPARC in co-operation with the Royal Society of Edinburgh, fund Enterprise Fellowships which provide salary and training for individual academics whilst they commercialise work originally supported by the Research Councils).

28. BBSRC, EPSRC, NERC and PPARC invest in the "Follow on Fund" which provides funds to enable researchers to demonstrate the commercial potential of ideas arising from research supported by these Councils. Proof-of-concept funding allows scientists the often small amounts of funding needed to demonstrate the commercial potential of their ideas. For example MRC development gap-funded work led directly to a substantial collaboration between the MRC Laboratory for Molecular Biology and Pfizer on G-protein receptors, an important class of drug targets.

29. Once commercial potential has been demonstrated, Research Councils can help scientists to develop robust business plans through the cross-Council Business Plan Competition. This helps UK based researchers to develop their ideas for commercialising research outputs by providing training and mentoring in the development of business plans and entrepreneurial skills. There are examples of many successful companies which have benefited from taking part in the competition (Thruvision, Neurosolutions, Orla).

30. Those Research Councils with their own institutes all have well established means for commercialising and exploiting the research they fund:

— BBSRC formally transfers ownership of IP to its institutes through the conditions of its grants. This is in line with government policy and the recommendations of the 1999 Baker Report to Treasury. In order to encourage management of IP on a portfolio basis, BBSRC has invested in an exploitation company, PBL, to handle commercialisation across the four plants and microbial science institutes. BBSRC's institutes hold 244 patents, have spun out 13 companies and, over the last four years, have generated exploitation income exceeding £7 million. Last year BBSRC institutes were involved in over 200 industrial consultancies involving some 160 separate companies. The Paracox vaccine, developed at BBSRC's Institute of Animal Health to control parasites in poultry, has now yielded over £1 million in royalty income.

— CCLRC established Central Laboratory Innovation and Knowledge Transfer (CLIK) Ltd in 2002 to professionally manage the commercialisation of CCLRC's IP. To date CLIK has established six spin-out companies in a wide range of market sectors including medical diagnostics and industrial sensors. These companies have already attracted approximately £6 million in external investment and currently employ 30 people. In addition, CCLRC's Computational Science and Engineering Department (CSED) is developing its commercial interests with the establishment of Daresbury Analytical Computing Services (DAComS) the commercial brand through which it promotes the commercial exploitation of CSED facilities and software.

— Evolutec was spun-out in 1998 to develop some biopharmaceutical discoveries made by NERC scientists. The development of the company's platform technology has been based upon the characterisation of proteins found in tick and other parasite saliva. These proteins have great potential for medicine as they have evolved over time to have very specific responses to a host's inflammatory response. Over-reactions by the immune system, such as certain autoimmune diseases and allergies, are possible therapeutic targets for the proteins identified by the company. Evolutec was listed on AIM in August 2004 with a capitalisation of £12.7 million.

— The MRC exploitation company, MRCT, generated exploitation income of over £20 million in 2004-05 (equivalent to 9% of research expenditure in MRC institutes and units, which is more than three times the proportion achieved overall by US universities). In 2005 MRC received £112 million from a deal with Abbott to allow them to use MRC-protected technology for making humanised monoclonal antibodies to produce a drug, HUMIRA, for the treatment of rheumatoid arthritis. Two of the largest UK biotechnology companies, Celltech and Cambridge Antibody Technology, originated as start-ups based on MRC technologies, and fifteen other start-up companies have been formed which, excluding Celltech, employ 1,135 staff).

— NERC employs a number of "exploitation scouts" to identify and develop early-stage commercial opportunities and has put in place a partnership with ISIS Innovation, one of the UK's leading university technology transfer organisations, to manage IP arising from four of their main institutes. NERC also provides its researchers with access to an innovation fund to help bring commercial opportunities to a point where they can be successfully licensed or attract external finance to establish joint ventures or spinout companies. The Innovation Fund enables researchers to obtain funds for the very earliest stages of a new business opportunity, supporting, for example, obtaining a patent or buying advice on market size. A successful example of commercialisation is Evolutec, a spin out company set up in 1998 to develop therapeutic products based on the characterisation of proteins found in tick and other parasite saliva, which could be used to treat certain autoimmune diseases and allergies. Evolutec was listed on AIM in August 2004 with a capitalisation of £12.7 million.

31. Following the Baker Report in 1999, OST established a PSRE fund, which provides funding to enable Public Sector Research Establishments (PSREs) to develop their capacity to exploit their science and technology potential and to provide seed funding to support the very early stages of business formation from ideas emerging out of research. The Research Councils are eligible to apply to this fund and several have been successful in their bids:

— PPARC is using its PSRE3 award of £893,000, together with funds awarded under previous rounds, to promote inward knowledge transfer from CERN (the European Laboratory for Particle Physics), ESA (the European Space Agency) and ESO (the European Southern Observatory) for the benefit of UK industry.

— Two of NERC's Marine Centres have won significant funding. The National Centre for Ocean Forecasting, based at the Met Office, has been awarded £568,000 to further research into forecasting the weather in the oceans. The Sea Mammal Research Unit (SMRU) at the University of St Andrews won £381,000 to develop new commercial applications for scientific instruments used to track marine animals and to provide scientific services to the marine industry.

— BBSRC and its institutes were successful in being associated with over 50% by value of projects funded. The Rainbow Seed Fund secured £2.5 million to increase the value of the fund to over £8 million. The Fund provides seed financing to help the development of ideas originating in partner organisations to be commercial concepts. Ideas backed by the fund over the last year by the fund have included new and cheaper techniques to diagnose breast cancer and a platform for drug development. The Norwich-based IP management and technology transfer company, PBL—in which BBSRC is a major shareholder—has been awarded £1.9 million to fund market research costs, marketing costs, support a technology development fund and promote innovation activities across four BBSRC-sponsored institutes. Genecom is led by the Roslin Institute, and also covers research at the Institute for Animal Health and the Moredun Institute.

IMPACT OF RESEARCH COUNCILS SUPPORT FOR KNOWLEDGE TRANSFER AND PERFORMANCE MANAGEMENT

32. Working together in cross Council collaboration, sharing knowledge and best practice, each of the Research Councils has published a delivery plan for the period 2005-06 to 2007-08, together with an agreed set of metrics which will be used to assess progress against the two PSA output measures. The metrics for output2 "to increase the contribution made to improving exploitation of the research base to meet national economic and public service objectives" were published in May 2005. Links to each Council's output framework can be found via delivery plans located through the RCUK website at http://www.rcuk.ac.uk/deliveryplan.asp.

33. Data against these metrics will be collected and published annually. The first reports will be made in June 2006. Research Councils have attempted to coordinate RCUK data with HEBI. However the level of aggregation of the HEBI data is too high to be of specific use to the Research Councils.

34. Each of the Councils also reviews their knowledge transfer portfolios and various schemes as part of routine management and evaluation.

35. Evaluating the impact of research on public policy is more challenging and cannot be addressed with metrics. In addressing this, AHRC for example is developing new approaches to impact assessment through a variety of means, including the appointment of Impact Fellowships.

36. In comparison with the US, UK HEIs generate more spin-off companies than US universities per £million of research expenditure. US universities form one spin-off for every £60 million of research expenditure compared with around £17 million per spin-off in the UK. The key role played by the Research Councils is illustrated in a recent survey by the Royal Society of Chemistry which showed that 85% of spin-outs from university chemistry departments were based on Research Council funded work.

37. The Innovation Report recommended that Research Councils' KT plans and goals for KT and innovation and their interactions with business should be subject to business led external review. The aims of this exercise are to:

— provide Research Councils and OST with an independent assessment of the strength and breadth of each Council's current and planned KT portfolio;

— establish a baseline for future assessments;

— identify best practice and opportunities for improving the effectiveness and efficient delivery of Research Council KT activities (both individually and collectively); and

— inform future spending reviews.

38. The review was held in December 2005. A panel of 10 users was assembled from across the Research Councils' user base including business; information technology; the life sciences; the creative industries; public sector; DTI; Regional Development Agencies; and the Scottish Executive. Each Council submitted report to the panel, setting out the role and responsibilities of the Council, their strategy for, and funding and delivery of KT. A team from each Council then met with the user panel to discuss their KT portfolio. Partnerships UK is preparing the report which will go to the Director General of the Research Councils and the RCUK Executive Group. This is expected to the first in a bi-annual business led review of Research Councils' knowledge transfer activity.

COORDINATION BETWEEN THE RESEARCH COUNCILS AND THE ROLE OF RCUK

39. Whilst having varied academic and user bases, the eight Research Councils work together where appropriate across a range of knowledge transfer activities, through the RCUK Knowledge Transfer Group (KTG). KTG provides a focal point for sharing information and good practice on knowledge transfer and a hub for collective dialogue with external organisations, including the DTI, the RDA Research Innovation Science and Technology (RIST) Group, PRAXIS and the Scottish Intermediate Technology Institutes (ITIs).

40. Through KTG the Councils have actively explored opportunities for cooperation arising from their long term programmes and their new plans developed in response to the Innovation report. Examples of joint programmes include the Business Plan Competition, Follow-on-Fund, Enterprise Fellowships, KTPs and KTNs. RCUK also coordinates the presentation of the RC programmes to external stakeholders, including the production of the brochure "Material World: Knowledge Economy" showcasing the Councils knowledge transfer portfolio. Attendance at key events is coordinated to ensure an effective RCUK presence.

41. The Research Councils are represented collectively on the Government's Technology Strategy Board (by the Chief Executive of EPSRC), and on a number of official level DTI lead operational groups. All Councils have benefited from the Research Council secondment to the DTI (2005) in terms of "joined up" communication. The Chair of the TSB also meets collectively with all Council Chief Executives twice a year. The Councils' have also developed good links with the CBI, working collectively with their Inter-Company Academic Research Group (ICARG).

42. The Research Councils are actively engaged in the Government's Technology Programme, and participating in working groups identifying technology priorities and supporting projects from the subsequent calls as follows:

April 2004

November 2004

April 2005

November 2005

— Regenerative Medicine (BBSRC/EPSRC/MRC);

— Energy—Low carbon/Oil and Gas (EPSRC);

— Data and Content (EPSRC);

— Power Electronics (EPSRC);

— Waste Minimisation /Resource Efficiency (EPSRC);

— To date, EPSRC has committed approximately £8.5 million funding towards 17 projects. EPSRC plans to commit up to £10 million pa from 2005-06 across technology areas and BBSRC has earmarked £2 million for the November 2005 and April 2006 competitions.

43. The Councils have also developed a joint peer review process with the DTI which makes it easier for organisations seeking co-funding, and which enables applicants to use the Councils' Joint Electronic Submission System.

44. The Research Councils have participated in the launch events for each of the Technology Programme calls, the Technology Strategy Stakeholders Information event and the DTI's regional road shows, aimed at stimulating business interest in the programme.

45. An important area of current RC/DTI engagement is in the identification of emergent areas of technology or emerging industry sectors that have the potential to become growth sectors of the future. The aim is to identify areas with potential (either from existing Research Council programmes such as Basic Technology or from discussions with the academic and user communities) where the community is not at a sufficiently advanced stage to seek funding through the Technology Programme, or where there is potential for research to translate across other sectors. Such areas could be developed further through small scale activities designed to build up a community and stimulate new business-academic collaborations. For example support for mini-networks, short feasibility studies or sandpits in a similar manner to the Ideas Factory.

February 2006

Annex 1: Arts and Humanities Research Council (AHRC)

RESEARCH COUNCIL SUPPORT FOR KNOWLEDGE TRANSFER

AHRC'S DEFINITION OF KNOWLEDGE TRANSFER

1. To exploit fully the new knowledge and learning that is generated in higher education institutions (HEIs), it has to be applied to areas of life where it can make a difference. This is the broad definition of knowledge transfer (KT) that the AHRC has adopted as the foundation for its KT strategy. This definition provides a good fit with the AHRC's mission and it also enables the challenges of the innovation agenda to be met as it:

— encompasses business interactions, which are of importance to the arts and humanities research base, within a broader concept of knowledge engagement;

— encompasses KT which has a business and economic focus, whilst capturing knowledge interaction with other audiences, including the public and voluntary sectors. It allows, for example, knowledge interaction with the museums and galleries and heritage sectors to be captured, as well as research that informs public policy and the enhancement of civil society;

— includes high-quality KT content for the print, film, digital and broadcasting media which is derived from arts and humanities research, as well as promoting the experience of the outcomes of this research through contemporary exhibitions and performances. The broader definition thus encompasses public engagement and understanding.

AN EVOLVING KT STRATEGY

2. The AHRC was established in April 2005. A predecessor body, the Arts and Humanities Research Board (AHRB) was in operation from 1998-2005. The AHRB was funded by the UK Higher Education Funding Councils and did not have a remit, or funds, to support and develop KT in the arts and humanities. It was only in the run-up to achieving Research Council status that attention turned to developing an AHRC KT Plan and bidding for associated funding. 2005 was the first time that dedicated KT funding become available and payments in the KT programmes in 2005-06 are forecast at £2,524,000 rising to £5,877,000 in 2007-08—an increase of 133% (see Table One below).

3. The AHRC's 10-year vision is to be recognised as the premier, innovative supporter of knowledge transfer in the arts and humanities. To achieve this ambitious goal AHRC's KT strategy includes specific plans for engagement with the creative industries and the museums and galleries sectors, plus generic strategies.

STRATEGIES TO SUPPORT KT AND THE CREATIVE INDUSTRIES

4. The UK creative industries (CIs) are a real success story. They are one of the economy's fastest growing sectors contributing over £53 billion to the UK in 2002, accounting for 8% of GDP and growing at an average of 6% between 1997 and 2002—double the rate of the economy as a whole. They encompass areas as diverse as design and music, computer games and animation, film and new media, intelligent textiles and fashion. The potential is there for the UK to become a world-class player, indeed computer games and new media are already recognised as such. The knowledge that these industries depend upon for their growth is multi-dimensional and not driven purely by technology; much of their vitality rests on the bringing together of the creative and performing arts, cutting-edge technologies, and innovative forms of business organisation.

5. The interplay between creativity and technology in these industries requires business models that are quite different from those of traditional manufacturing industries. Conventional models of knowledge transfer do not map readily onto the CIs and it seems to be the case that the character of research and the structure of these industries require new models to be developed and facilitated.

6. The AHRC is tackling this issue by leading a Task Group on Research and Knowledge Transfer that sits within the Creative Industries/Higher Education Forum at the Department of Culture, Media and Sport. This Group, chaired by the Council's Chief Executive, is now in its second and final year of a work programme that seeks to identify both the challenges and opportunities in research and development (R&D) activities for the CIs sector. It has enabled strategic partnerships to be formed between the research base and the CIs, so as to determine the requirements of the CIs and facilitate sustainable communication between industry and the HE sector. The Group has also undertaken research to identify and define appropriate models of KT for the CIs and the arts and humanities research base. The objective is to determine what works and what does not through identifying good practice and barriers to KT for different CI sub-sectors.

7. Additionally, the Group has identified potential barriers for the sector within the existing innovation support framework in the UK. Notably, it is addressing the anomaly that Government defines R&D for tax purposes as follows: "R&D for tax purposes takes place when a project seeks to achieve an advance in science or technology . . . Work in the arts, humanities and social sciences, including economics, is not science for the purposes of these guidelines."[2] This sits at odds with the KT remit of the AHRC, and in turn discourages businesses in the CIs from drawing on the full potential of the UK research base. The R&D and innovation needs of the CIs go beyond the application of new technologies, requiring the development of new content, narrative and understanding of user interfaces for example. The CIs sector is forced to absorb the full cost of such R&D activities at present, and that reduces its ability to innovate and compete in a global market. Challenging outdated concepts of R&D, and recommending alternatives, sits at the heart of the AHRC's KT ambitions.

8. The achievements of the Task Group in its first year of operation include:

— the broadening of the overarching criteria for Knowledge Transfer Partnerships (paragraph 14 refers) following recommendations from the Task Group to DTI to improve access for the CIs to the scheme;

— the delivery of workshops and seminars in collaboration with non-academic partners to bring stakeholders from CIs, HE and government together;

— the development of sustainable relationships with industry, KT intermediaries, HEIs, RDAs and DAs, government departments and international agencies to disseminate models and case studies of good practice in KT;

— the initiation of innovative collaborative R&D partnerships between AHRC and non-academic partners as part of the development and implementation of the Collaborative R&D Fund (Annex A refers). One such partnership, for example, is a new strategic collaborative R&D engagement between AHRC and BBC New Media.

The work of the Task Group will conclude in summer 2006 when the Group will make its recommendations to government, AHRC and other stakeholders.

STRATEGIES TO SUPPORT KT AND THE MUSEUMS AND GALLERIES SECTOR

9. The major UK museums are world-leaders and make a vital contribution to the nation's cultural, educational, social and economic life. They preserve and make available to the public collections unsurpassed in range and quality in the rest of the world. Museums in England alone attract over 77 million visits a year, and the economic impact of the UK museums sector is estimated to be at least £2 billion a year.

10. Museums also constitute a critical part of the research base for a wide range of subjects. Research in museums themselves, and research in the HE sector which flows into museums, are of crucial importance in enabling them to present and interpret their collections to visitors, through publications, and online. Research also underpins museums' work in education and learning, in inspiring creativity and innovation; attracting tourists to the UK and supporting the tourist industry; contributing to social inclusion, and promoting economic and social regeneration; and generating social capital, civic, community and national pride, and good citizenship.

11. But there has been up to now no organisation whose role it has been to support research of this kind. The AHRC is set to perform this role, having created a funding programme that will establish the first-ever integrated strategy for the direct support of research in museums. Our investment will ensure that UK museums remain world leaders. It will also enhance, through exhibition and display, communication to a variety of audiences of the latest advances in understanding arising from recent research and scholarship.

12. The programme is already underway with a call for research workshops, announced in October 2005, with the aim of forming partnerships between specialists in museums, galleries, libraries and archives, and their colleagues in universities. These research workshops will provide an opportunity to discuss major arts and humanities research themes, and to focus more directly on the work of museums and galleries. The strategy as a whole will be further informed through consultation with both the museum and higher education sectors but as the programme is rolled out over the next three years, it is likely to include support for: research to underpin permanent and temporary exhibitions and displays; research in conservation and preservation; the establishment of networks across the museum and higher education sectors in areas such as fashion, history of science, archaeology, or photography; cross-sectoral exchanges and secondments; capacity-building via the funding of postgraduates in order to increase the supply of people with appropriate expertise; and research that informs us how visitors engage with the objects and displays they see, and what they learn from them, thus improving our understanding of these matters, the quality of museum displays, and strategies to enhance the impact of museums.

GENERIC STRATEGIES TO SUPPORT KT

Co-operative education and training

13. In 2005 the AHRC made its first awards under a new Collaborative Doctoral Awards scheme (akin to CASE awards) to promote partnerships and research collaboration between HEIs and non-academic partners. The scheme has proved to be of interest to businesses in the creative industries, media and design companies, libraries, museums, galleries, heritage organisations, and health trusts for example. A budget of £500,000 per annum is available for this scheme.

Supporting people and the knowledge flow

14. The AHRC plans to support individuals in KT as follows:

— In September 2005 the Council became a sponsor of the DTI's Knowledge Transfer Partnership (KTP) scheme. Our funding remit for the scheme encompasses the whole breadth of the arts and humanities research base and deliberately seeks to support knowledge transfer, as opposed to the more restrictive, traditional term of technology transfer. The community has already embraced this challenge and high-quality applications have started to flow with business partners ranging from music publishers to fashion retailers. The Council has set aside £350,000 per annum for sponsorship of KTPs.

— AHRC plans to produce an annual publication to show case KTPs in its subject domain, both to act as an exemplar of good practice, raise awareness of the scheme and to lever more exchange between the research base and the public and private sectors.

— KTPs can be a large step for a micro-enterprise engaging with a HEI for the first time (which is a typical descriptor of a company in the creative industries). In recognition of this there is scope for a precursor-type KTP scheme of a shorter duration that requires less financial investment on the part of the company. Some HEIs have experience of running their own funded schemes of this kind and report that they act as a successful stepping-stone to further, sustained engagement with the research base. The AHRC plans to establish a precursor type KTP scheme to draw SMEs into engagement with the arts and humanities research base. Consultation will commence early in 2006, so that applications can be received before the end of 2006.

— Stimulating mobility between HEIs and other sectors is another means by which the AHRC proposes to facilitate KT. The plan is to initially pilot such a secondment scheme in the museums and galleries sector as part of the AHRC's developing strategy in that area.

— In December 2005 a proposal will be put to the AHRC's Council to support a new scheme called "KT Leave". The AHRC already runs a highly successful Research Leave scheme which is unique amongst the Research Councils; it provides three or four months of salary costs to relieve an academic of all teaching and administrative duties, and this period of leave is matched by the HEI, in order to enable the academic to compete a piece of research. The KT Leave scheme, with a proposed budget of £1.5 million per annum, would fund 80% of the full economic costs of an individual for between one and three years (but typically one) so that they could pursue KT activities. We would not be prescriptive about the activities that could be funded, but they might for example include:

(a) working-up for wider dissemination existing resources based on research, such as video or web-based materials (in drama or dance, for example);

(b) preparation of web-based virtual models/accounts of sites of archaeological or historical interest as an aid to actual or remote access to those sites;

(d) the preparation of teaching materials (web-based or textual) for undergraduate or school use;

(e) the provision of periods of leave for academics to work in academic or non-academic settings in relation to a particular knowledge transfer purpose.

In each case applicants would have to demonstrate their high academic standing and that the work in question would represent the dissemination of cutting-edge, top quality research. Provided that the Council approves the outline of this scheme, we intend to consult on its specification early in 2006, so that applications can be received in the autumn of that year.

Building relationships with user communities

15. The AHRC's KT strategy seeks to ensure that research in the arts and humanities engages with and informs as wide a range of "users" as appropriate. To this end activities include the introduction of a pilot dissemination scheme in 2004 with the aim of stimulating researchers to convey their research findings to wider audiences than those envisaged at the start of the project. Awards of £5,000 are available to our research grant holders to engage in this type of dissemination, which includes the commercialization of outcomes. The pilot scheme will be reviewed at the end of 2005 and is likely to be re-branded to raise awareness of the opportunities it offers and to include within it targeted funding in support of commercial dissemination.

16. The arts and humanities make a fundamental contribution to key areas of public policy and wider public understanding. Through enhancing our understanding of ourselves and our world, the impact is felt in areas of public policy as diverse as law, ethics, media and communications, ethnicity and cultural diversity, language and language technologies, and creativity and innovation. Metrics are too blunt a tool to capture such impacts and for that reason the AHRC is developing new approaches to impact assessment through a variety of means, including the appointment of Impact Fellowships. One of the three-year Fellowships, for example, is seeking to improve the quality and reliability of data about the impact of KT activities between the arts and humanities and the CIs. The major output of this project will be an intervention into developing debates about the nature of KT in the arts and humanities within the context of the CIs and an associated framework of indicators to measure activity and capture impact. This is important as KT interactions with the CIs are poorly captured by standard surveys, and this under-reporting results in the value of these exchanges being diluted.

Promoting entrepreneurship and the commercialisation of research

17. The AHRC promotes entrepreneurship and supports the commercialisation of research in a number of ways, including:

— In 2006 the AHRC will create a National Research and Business Development Network for both academics in the arts and humanities and staff in HEIs who provide KT support for them. The virtual Network will assist information flows between the AHRC and HEIs and amongst HEIs. In this way HEIs can help shape AHRC's KT strategy and good practice can be shared. A Network Manager has been appointed to start in November 2005.

— Co-funding the joint Research Councils' Business Plan competition. The AHRC made a financial contribution to the last Business Plan competition that secured entry to it for the arts and humanities research base for the first time. This community was very responsive to the challenge of the competition, submitting 32% of all the expressions of interest that were received and constituting 20% of all those invited to participate in the next stage of the competition. Five plans were short-listed, with four of the finalists being from either EPSRC or MRC's research community and the other from our community.

— The introduction of a Collaborative Doctoral Awards scheme (paragraph 13 refers).

Table One

FORECAST KT PROGRAMME PAYMENTS

Activity	2005-06	2006-07	2007-08
Postgraduate Collaborative Doctoral Awards	£395,000	£1,066,000	£1,929,000
Dissemination Scheme	£100,000	£100,000	£100,000
Sponsorship of DTI's KTP Programme	£350,000	£350,000	£350,000
"Stepping-stone" KTP scheme	£0	£208,000	£250,000
Museums and Galleries Research Programme	£0	£250,000	£1,000,000
R&D Collaborative Fund	£0	£300,000	£625,000
KT Research Leave Scheme	£1,500,000	£1,500,000	£1,500,000
RCUK Business Plan Competition	£25,000	£25,000	£0
Impact Fellowships	£154,000	£195,000	£123,000
Total	£2,524,000	£3,994,000	£5,877,000
Total planned expenditure on research	£36,658,100	£49,347,800	£59,500,300

Annex 2: Biotechnology and Biological Sciences Research Council (BBSRC)

SUPPORT FOR KNOWLEDGE TRANSFER

BACKGROUND

1. BBSRC's budget in 2004-05 was £312 million. Of this over 50% was spent on research grants and initiatives to universities, with some 30% of total funding going to eight (soon to be seven) BBSRC institutes. Support for studentships and fellowships amounted to some 11% of budget. Available metrics show that the UK bioscience research base is very strong internationally. BBSRC recognises that there are major opportunities for the UK to derive economic and social benefit from our world-class bioscience research base and in order for this to be realised, it is essential that knowledge be effectively transferred from the laboratory to potential users of that knowledge.

2. In broad terms, research and training activities supported by BBSRC in universities are more relevant to the needs of the pharmaceutical, biotechnology and chemical sectors. These industries are R&D-intensive and interact substantially with the science base. The programmes of BBSRC institutes focus on agriculture, environment, agrochemical, plant and animal breeding, and food, with one institute (Babraham) moving more towards biomedical. In general users in these sectors are less R&D-intensive, where transfer of best practice is important as well as providing evidence-based policy for government departments. The BBSRC approach to knowledge transfer (KT) endeavours to recognise the needs and characteristics of the various sectors.

3. BBSRC delegates responsibility for the management and commercialisation of IP arising from the research it supports to the research generator. For the eight BBSRC-sponsored institutes, ownership of IP is formally transferred to the institutes through the conditions of grant. This is in line with government policy and the recommendations of the 1999 Baker Report to the Treasury. Recent studies by the National Audit Office recognise substantial progress has been made by BBSRC institutes in encouraging commercialisation of research outputs.

4. Whilst details of BBSRC's support for knowledge transfer are set out in the following paragraphs, the following headlines are drawn to the Committee's attention:

— the pharmaceuticals industry is one of the biggest investors in R&D in the UK, and the UK biotechnology sector is second only to the USA. These sectors benefit substantially from access to high quality research and manpower supported by the Research Councils;

— BBSRC has pioneered a number of novel approaches to encourage commercialisation and collaboration with industry, including Young Entrepreneurs Scheme (1996), Business Plan Competition (1999), Follow-on Fund (2004) and Industry Interchange Programme (2005);

— BBSRC is significantly increasing its support whereby, in 2007-08, funding for collaborative R&D will double to £8 million p.a., support for industry partnerships increase to £4.5 million p.a., and support for KT through a range of mechanisms increase to £4.9 million p.a. In addition we will spend some £9 million pa on 600 CASE studentships and BBSRC Institutes will receive over £12 million p.a. income from contracts and collaborations with industry;

— 16 university departments substantially funded by BBSRC have spun-out 42 companies;

— particularly successful university spin-outs arising from BBSRC-supported research include Oxford Biomedica (LSE-listed), Inpharmatica, Biotica and NeuroSolutions. The latter company was established following its successful participation in the 2001 Business Plan Competition and is highly successful with extensive contracts with pharmaceutical companies;

— in the period 2000-04, BBSRC institutes won research income exceeding £60 million from industry and £14 million from research charities;

— BBSRC institutes hold 244 patents, have spun-out 13 companies and, since 2001, exploitation income has exceeded £7 million;

— last year BBSRC institutes were involved in 200 industrial consultancies involving some 160 separate companies;

— the Paracox vaccine, developed at BBSRC's Institute of Animal Health to control parasites in poultry, has now yielded over £1 million in royalty income; and

— societal impacts are also evident, ranging from early support for Professor Sir Alec Jeffries at Leicester University, which led on to DNA fingerprinting with its subsequent impact on crime detection, through analysis of the FMD virus which impacted government policy on handling the foot and mouth disease outbreak, to pioneering cloning studies at BBSRC's Roslin Institute, which opens up potentially enormous health benefits through therapeutic applications of stem cells.

BBSRC APPROACH TO PROMOTING COLLABORATION AND KT

5. BBSRC aims to optimise the process through which research leads to benefit for the economy and society providing support mechanisms for BBSRC-funded scientists in both universities or institutes at key stages in the commercialisation process. Our approach is described in subsequent paragraphs under four broad areas: Collaboration in Research; Collaboration in Education and Training; Networking through People and Knowledge Flow; Commercialisation. BBSRC's recent Delivery Plan has set ambitious targets for enhancing activity in these areas where targets for 2007-08 are highlighted in bold in the sections below.

Collaboration in Research

6. In 2003-04 BBSRC supported some £12 million of collaborative research grants, primarily through the LINK mechanism, involving 55 companies. BBSRC plans by 2007-08 to double its support for collaborative R&D, where significant progress is already being made:

— A BBSRC Technology Strategy has been developed, following consultation with industry, identifying eight priority areas where science activity needs to be enhanced to meet industrial need over the next 10 years. We will seek to fund collaborative activity in these priority areas, where progress is already being made in:

Integrative Mammalian Biology:

Bioprocessing:

Crop Products and Processes:

— BBSRC will work with the DTI in the development of a national Technology Strategy. BBSRC has agreed to partner with DTI in calls for collaborative R&D proposals in Industrial Bioproducts (November 2004), Biopharmaceutical Bioprocessing (April 2005) and Regenerative Medicine (November 2005); and

— There is much benefit in encouraging industry awareness and partnership in responsive mode grants submitted to BBSRC. Therefore we have introduced an Industrial Partnership Award (IPA) scheme, through which all research proposals that have obtained a 10% cash contribution from industry will be funded provided they reach a quality threshold. It is intended that by 2007-08 BBSRC will increase four-fold support for IPAs.

Collaboration in Education and Training

7. At any one time BBSRC supports over 2,000 PhD students, of which some 30% are in collaboration with industry through CASE awards. We recognise that trained manpower moving into industry is a key component of knowledge transfer, where current figures show 21% of BBSRC-funded postgraduates moving into industry immediately upon completion of their PhD. We have responded to industry pressures by:

in vivo

— introducing an Industrial CASE scheme in which companies apply for the awards. By 2007-08 we plan to increase numbers of Industrial CASE Awards by 30% to 120 awards per annum. We are working with RDAs to enlist their support in bringing opportunities to the attention of SMEs in their area; and

— pump-priming short courses with the aim of providing update training in new and emerging areas for scientists in industry. Over the past three years, 37 modules have been funded and, given the success of the scheme, we are planning to increase funding by 40% to £280,000 per annum by 2007-08.

Networking through People and Knowledge Flow

8. It is frequently said that the best form of knowledge transfer is on the hoof and we are therefore keen to encourage interaction between the science base and industry with a view to creating permeable boundaries that enable the exchange of people and ideas. Particular activities include:

— in the past Faraday Partnerships (FP) have been effective in encouraging dialogue between academic and industrial researchers in particular sectors. For the future DTI is now developing a similar concept of Knowledge Transfer Networks (KTNs). BBSRC is playing an active role in interacting with these and will respond to collaborative research proposals or Industrial CASE projects emerging from these networks; and

— we have supported the movement of scientists between academe and industry, and vice versa, through sponsorship of the Royal Society Industry Fellowships (IF) scheme. However we wish to encourage further interchange to facilitate access to facilities or to acquire new skills, where interchanges of even relatively short duration can be of benefit in meeting strategic needs and providing a base for longer-term partnerships. In September 2005 BBSRC therefore launched an Industry Interchange Programme (IIP) to encourage such strategic partnering. Providing good proposals are forthcoming, we plan to support at least 10 awards by 2007-08.

Commercialisation

9. We have developed a pipeline of activities to support the commercialisation of BBSRC science. We recognise that there are other players in this space, principally university technology transfer offices and RDAs, and look to work with these wherever appropriate. Activities include:

— we are keen to enhance awareness of intellectual property amongst successive generations of BBSRC-supported postgraduate students and postdoctorals. We therefore co-fund, with local technology transfer offices, IP awareness events. In 2003-04 we were involved with 22 such courses in which 890 bioscientists participated. For 2007-08 we plan to sponsor 30 courses reaching 1,200 individuals;

— the Biotechnology Young Entrepreneurs Scheme (YES) is aimed at enhancing the commercial awareness of bioscientists at the postgraduate and postdoctoral level. BBSRC launched this scheme in 1996 and now operate it in conjunction with MRC and NERC. At its tenth anniversary, this scheme has proved highly successful, where a recent review highlighted many examples of the scheme influencing the career paths of participants, including the launching of their own start-up companies. For 2007-08 we intend to expand participation by 20%, reaching out to 180 young bioscientists per annum;

— the aim of the Follow-on Fund is to provide proof-of-concept funding, at around the £60,000 level, to allow the commercial potential of ideas generated through BBSRC grant funding to be further explored. This scheme was launched in 2004 with EPSRC and NERC as partners. In that year we awarded grants of value £600k. We now plan to provide proof-of-concept funding of at least £1 million per annum;

— the Bioscience Business Plan Competition was initiated by BBSRC in 1999 and now is run as a cross-Council competition. BBSRC will continue to support this scheme as long as the need continues;

— we launched an Enterprise Fellowships Scheme in early 2005, in collaboration with the Royal Society of Edinburgh, to provide scientists with a potentially commercialisable idea the time and skills to move forward their idea. In May 2005 we awarded the first four fellowships. We plan to support at least 10 such fellows by 2007-08;

— for many universities access to Seed Funds now exists at a local or regional level. For our own institutes, BBSRC has become a partner of the Rainbow Fund, providing support for up to £250,000 for start-ups arising from our institutes;

— for a fledgling company, the nurturing environment of a bioincubator providing access to skills and facilities can be highly important. Three BBSRC institutes provide bioincubator facilities, where the bioincubator at the Babraham Institute has been particularly successful with eighteen companies on site. Furthermore, a new biodevelopment building, offering grow-on accommodation to expanding bioventures, was opened in 2005 and is now fully occupied; and

— BBSRC has assisted small bioscience companies to expand their research capabilities. Over the past four years 33 SBRI awards have been made to 28 SMEs totalling £6.9 million.

BBSRC INSTITUTES AND KT

10. The role of BBSRC institutes in KT merits further explanation:

— the BBSRC institutes are significant in size with annual revenues ranging from £9-31 million, with BBSRC funding generally below 50%. In line with advice to the Treasury contained in the 1999 Baker Report, BBSRC delegates responsibility for KT management to its institutes. Nevertheless, in order to encourage management of IP on a portfolio basis, BBSRC has invested in an exploitation company, PBL, to handle commercialisation across the four plant and microbial science institutes;

— BBSRC reviews the performance of its institutes through a formal knowledge transfer assessment exercise every four years. In addition progress on KT matters is reported annually to Council and is a fixture of six-monthly "Business Plan" meetings;

— in 2004 OST operated a PSRE Fund through which public sector research establishments were invited to bid for resources to enhance their KT activities. Whilst competition was strong, BBSRC and its institutes were successful in being associated with over 50% by value of projects funded; and

— BBSRC institutes primarily pursue work relevant to agriculture and food where they play a substantial role in the development of evidence-based policy for government departments, particularly Defra and the FSA. In addition, a key part of knowledge transfer activity for these institutes is the work they do to demonstrate and achieve implementation of best practice.

STAKEHOLDER ENGAGEMENT AND COMMUNICATION

11. BBSRC Council and its advisory Boards, Committees and Panels are constituted by individuals from a wide range of backgrounds, with over 20% drawn from user communities, including experts from the pharma, biotech, chemicals, food and agriculture sectors. To help us develop and implement our policy relating to business interaction and knowledge transfer, we are guided by a Bioscience for Industry Panel comprising industrial representatives, KT and finance professionals, together with representation from RDAs and DTI. To improve the quality of our decision making, and to help foster public trust in science outcomes, Council is advised via its Bioscience for Society Panel. This includes social scientists, bioethicists and individuals from a range of NGOs. We use the media, public meetings and exhibitions, publications, and interactions with schools to promote awareness of advances in bioscience and their applications.

12. BBSRC developed its Ten-Year Vision and Strategic Plan through a series of discussions with stakeholders. We routinely use a variety of mechanisms to engage stakeholders with new research opportunities and developments. The outcomes enable scientists and end-users to reflect on, and respond to, public aspirations and concerns that might impact on future commercialisation and uptake of new technologies. Examples of activities include: the UK's first Consensus Conference, on plant biotechnology, in 1994; and more recently, discussion meetings, consultations and attitude surveys on future directions in crop science, livestock genomics, and research on diet and health. We are also contributing to public engagement on energy research and on nanotechnology.

13. We are in frequent discussions with trade associations such as ABPI, BIA and FDS. BBSRC staff regularly visit companies and contribute to conferences and meetings, including those arranged by CBI.

RESULTS AND PERFORMANCE MANAGEMENT

14. In 2005 BBSRC, together with the other Research Councils, produced a Delivery Plan covering the period to 2007-08. A Performance Management Framework has been agreed with OST, where we report progress against a scorecard on a quarterly basis.

15. Evaluation of the outputs from BBSRC programmes is routine where, for example, for research activity, we have a rolling series of portfolio and initiative reviews ensuring that we are able to benchmark and evaluate not only the scientific output of BBSRC-supported research, but also outputs impinging on society and the economy. We also collect a comprehensive set of exploitation metrics from our institutes and leading university bioscience departments.

16. We regularly review the effectiveness of our KT initiatives, where recent examples include:

— in autumn 2005 we carried out a career tracking study of "graduates" of our Young Entrepreneurs Scheme. This revealed that most had substantially benefited from the training given and where "graduates" were twice as likely to obtain subsequent employment in industry as their peers, with significant numbers either working in SMEs or even starting-up their own companies; and

— a review of the 30 teams benefiting from mentoring in the first two Business Plan Competitions revealed that 10 had gone on to raise, within two years of participation, over £2 million of risk capital.

Annex 3: Council for the Central Laboratory of the Research Councils (CCLRC)

RESEARCH COUNCIL SUPPORT FOR KNOWLEDGE TRANSFER

EXECUTIVE SUMMARY

The CCLRC's unique scientific heritage, science facilities, underpinning technologies and wide base of academic users provide an exceptional environment for Knowledge Transfer (KT). For the CCLRC, KT encompasses the systems and processes by which knowledge, expertise and skilled people transfer between the CCLRC's research programmes and industry contributing to the creation of wealth in the UK.

These activities include:

Exploitation

Wider access to CCLRC large research facilities

Leveraging knowledge through training

Campus Development

INTRODUCTION

1. The CCLRC is one of Europe's largest multidisciplinary research organisations operating the Rutherford Appleton Laboratory (RAL) in Oxfordshire, the Daresbury Laboratory (DL) in Cheshire and the Chilbolton Observatory in Hampshire. The CCLRC manages fundamental research facilities in neutron scattering, high power lasers and synchrotron radiation alongside broad science and technology programmes ranging from space science and high power computing to particle physics and advanced instrumentation. These facilities and programmes are operated on behalf of the UK's academic community and sister Research Councils (RC). The CCLRC differs significantly from RCs who operate major programmes of research grant funding and postgraduate training.

2. The large facilities operated by the CCLRC are ISIS, the world's leading pulsed neutron and muon source, the Central Laser Facility, the worlds most intense academic laser facility, and the Synchrotron Radiation Source, a world class facility dedicated to the exploitation of synchrotron radiation for fundamental and applied research. The CCLRC's core competencies include the engineering and instrumentation programmes that underpin its facilities and research programmes—the CCLRC "makes science happen".

3. Complementing its in-house capabilities the CCLRC also manages the UK interests in the Institut Laue Langevin and the European Synchrotron Radiation Facility in Grenoble. On behalf of the UK government, the CCLRC is also the main shareholder in Diamond Light Source Ltd.

COLLABORATION BETWEEN RESEARCHERS AND PARTNERS IN INDUSTRY, INCLUDING THE CREATIVE INDUSTRIES AND SMES

4. In 2004-05 the CCLRC collaborated with 1,600 higher education institutes, government research bodies, industries and other organizations. Through these interactions CCLRC knowledge and expertise is transferred through collaborative research, the supply and use of research facilities or services, the co-development of CCLRC facilities or technology, or in the provision of training by CCLRC staff.

The following examples illustrate how the CCLRC's knowledge and expertise is transferred to the private sector.

CCLRC facility access by industry

5. Industrial usage of CCLRC facilities can be direct, through contracted research programmes, or more frequently is indirect through UK academics working on collaborative research programmes with the private sector.

6. An example of this is the usage of the ENGIN-X beamline at ISIS which is a dedicated engineering facility optimized for engineering strain and stress measurements in engineering components such as turbine blades. Around 50% of the facility time on ENGIN-X is used for industrial applications. Experimental collaboration involving Rolls Royce, the University of Manchester and Imperial College has resulted in neutron strain scanning forming an integral part of the research programmes that underpin product development at Rolls Royce.

7. Commercial access to the SRS and other materials characterisation services at the Daresbury Laboratory are facilitated by Daresbury Analytical Research Technology Services (DARTS). Through DARTS, industry can apply the unique capabilities of synchrotron radiation, and the skills of Daresbury's research scientists, to research problems in a timely, cost-effective way. The SRS has worked for 22 private sector customers in the last two years, predominantly from the pharmaceutical sector—for example AstraZeneca, GlaxoSmithKline, Avidex Ltd and Vertex Pharmaceuticals Ltd. The most popular services have been protein crystallography and nanoparticle size distribution measurements using small angle scattering.

Examples of departmental collaborations with industry

8. The CCLRC's Science and Engineering departments also have strong links to industry. The Space Science and Technology Department (SSTD) has 80 contracts running with industry, to the value of around £6 million this financial year. This includes substantial contracts to supply instrumentation for satellites into industry, a leading example being a multi-$M contract from Lockheed for a NASA satellite. The SSTD has also provided novel space camera technology for the TopSat spacecraft designed to demonstrate the capabilities of small satellites for high value remote sensing missions. Built by Surrey Satellite Technology Ltd, the mission is managed by QinetiQ Ltd using £12 million of funding from the British National Space Centre and Ministry of Defence. In addition, the CCLRC provides telemetry for the GIOVE-A mission, a pilot satellite for the Galileo project, again built by Surrey Satellite Technology Ltd.

9. The Computational Science and Engineering Department (CSED) are developing their commercial interests with the establishment of Daresbury Analytical Computing Services (DAComS) the commercial brand through which it promotes the commercial exploitation of CSED facilities and software. Current examples of commercial interactions include partnership with Intel to benchmark their processors on a broad spectrum of scientific applications and with AMD to explore life science applications of their hardware. Most recently the CSED have partnered AstraZeneca in a £300K three year contract to undertake high performance computing simulations for drug formulation.

Commercialisation

10. Central Laboratory Innovation and Knowledge Transfer (CLIK) Ltd, was established in 2002 to professionally manage the commercialisation of CCLRC Intellectual Property. To date CLIK has established six spin-out companies in a wide range of market sectors including medical diagnostics and industrial sensors. These companies have already attracted approximately £6 million in external investment and currently employ 30 people. ThruVision, a recent spin-out company from the SSTD, is aiming to become the leading commercial provider of compact security screening equipment using terahertz imaging technology and is generating substantial commercial interest with a range of security products. Thruvision won the 2003-04 RCUK Business Plan Competition.

Collaboration with the creative sector

11. The 2 million Euro "Ancient Charm" project supports scientists to develop new or combine existing research techniques to investigate objects of cultural heritage. In this project, ISIS has been used to generate 3D graphic animations of bronze statues using neutron tomography. Other projects include authenticity investigations of archaeological artefacts using CCLRC facilities (ISIS and Synchrotron Radiation Source) to non-destructively analyse archaeological objects to understand manufacturing techniques, assess authenticity and develop conservation techniques.

Collaboration with SMEs

12. The CCLRC has strong links with UK high technology SMEs in the product areas relevant to its technology needs. Key examples include magnet design and construction (Tesla Engineering Ltd), solid state imaging detectors (e2v, Applied Microengineering Ltd), extreme sample environments, (Oxford Instruments), satellite technology (Surrey Satellites Ltd), micro and nano fabrication (Xfab, Nanosight Ltd), and micro electronics fabrication.

13. The CCLRC maintains strong links with companies that have spun out of its technology programmes for example Qudos and Oxsensis. Where such companies have strong synergies with CCLRC technology, they co-locate onto CCLRC laboratory sites; four are currently co-located.

STAKEHOLDER ENGAGEMENT AND COMMUNICATION

14. The CCLRC sits at the centre of a complex matrix of stakeholders that includes academia, the private sector, regional and local government and other RCs. The following examples illustrate how the CCLRC has engaged with this diverse set of stakeholders.

Private sector engagement

15. The CCLRC hosts industry days to engage with those industry sectors that can utilise large facilities within their R&D programmes or supply the high technology components required for large facilities.

16. Certain industry days are clearly associated with major procurement programmes for CCLRC facilities. Recent examples include industry days for 4GLS (a next generation high intensity light source) in 2004, ISIS Target Station two and the Diamond Light Source in 2005. The 4GLS industry event, organised and sponsored by the North West Development Agency (NWDA), attracted over 94 delegates representing 33 firms interested in the advanced technology required to construct and the scientific exploitation of 4GLS. In 2005, 100 visitors from a broad range of industrial sectors attended the Diamond Light Source open day to understand the facility and its potential to support private sector R&D.

Regional and local government engagement—Campus development projects

17. Over £50 million has been invested in the Daresbury International Science and Technology Park by the NWDA creating over 24,000 sq ft of laboratory. To date 17 high technology companies, with strong synergies to the Daresbury science base, have been attracted to the site with an additional four already planned. At the RAL, the Minister for Science has confirmed that the Harwell site will also be developed into an "International Science and Technology Campus".

18. Proximity to CCLRC research facilities at the DL and RAL, for academia in "research hotels" or the private sector through campuses, are established routes to foster collaboration and innovation. The CCLRC campus programmes for these laboratories will be developed coherently and used as models of excellence for innovation and public sector KT with the RDAs.

Academic engagement

19. The CCLRC has an active Education and Training programme in which it engages with academia. The CCLRC is an active partner in a local Centre of Vocational Excellence. In addition, the CCLRC acts as an industrial partner in the Cooperative Awards in Science and Engineering studentship scheme. A pilot "Graduate School" to provide opportunities for research students and participants from industry to attend work placements at CCLRC research facilities is currently being established.

20. CCLRC departments engage extensively in the provision of training courses, summer schools, visiting lecture programmes and seminars in their specialist areas. The CCLRC collaborated in training provisions with 92 different Universities during 2004-05, for example around 25 SSTD staff regularly lecture in HEIs.

RESULTS AND PERFORMANCE MANAGEMENT

21. The CCLRC, distinct within the RCs in its focus on facility operation rather than grant funding and training, has a unique role to play in delivering wider economic value from the science budget. The contribution of the CCLRC to delivering the KT agenda is broad encompassing its ambitions in training, commercialisation, facility utilisation and campus development. The results of this programme will be assessed through a combination of the metrics established as part of the OST RC performance management framework and case studies.

22. The metrics that the CCLRC has established in the output two metrics framework—"Better Exploitation", as follows:

Interaction with business and public services 03/04 04/05 05/06 to date

% of major CCLRC facility "beam-time" employed by 1% ISIS 1% ISIS 1% ISIS

private sector directly 3% CLF

6% SRS 1% SRS

1% SRS

Number and income from direct private sector users of CCLRC facilities. 132
£1.1M 204
£1.0M 232+
£1.0M+

% of major CCLRC facility "beam-time" employed by academic/private sector collaborations

Number of academic/private sector collaborations using CCLRC facilities

Information not historically collected, new data gathering scheme in place with first
results expected in Summer 06.

Number of private sector businesses co-located on CCLRC campuses NA NA 21

Number of co-authored publications arising from academic institution/private sector collaboration using CCLRC facilities 45 80 65

Turnover and employee numbers for co-located private sector companies on CCLRC campuses NA NA £2.5M plus
significant V.C.
investment
52 staff

Collaborative research

Number and value of collaborative private and public sector technology development projects 50
£2.54M 45
£2.45M 100
£6.35M

Commercialisation of research

Number of start up companies established per year 3 3 1

Number of patent filings per year 10 14 6

Commercial income (revenue/turnover) of start up companies 0 £550K Awaiting annual
accounts

Income arising from licensing and royalty based
agreements per year £40K £48K £34K

Cooperative training

No. of CCLRC sponsored CASE award students Unknown 15 12

KT expenditure

23. For clearly defined KT programmes the following table presents an assessment of CCLRC's KT expenditure. Not included in this assessment are the intangible costs associated with the activities of the CCLRC's programmes and staff that contribute to KT, for example, presentation at conferences, informal discussion with facility users, co-authorship of papers etc. Such contributions to the CCLRC's KT are believed to be significant and may represent up to 10% of staff time.

CCLRC financial support for KT programmes/activities £K
Direct KT staff time FTE

2003/04
2004/05
2005/06
2003/04
2004/05
2005/06

Total 2,000 2,000 2,300 20 19 22

Co-ordination between the Councils and the role of RCUK

24. The CCLRC's facilities and programmes are operated on behalf of the UK's academic community and Research Councils. Approximately 30% of the CCLRC's annual income of £155 million is funded by PPARC, EPSRC, NERC, BBSRC and the MRC. Service Level Agreements cover the main programmes commissioned by these Councils. The history of the CCLRC as the central laboratory for the RC positions the CCLRC as a key partner to collaborate with the RCs in their programmes.

Examples of collaborative KT programmes with the other RCs include—

25. The CCLRC and EPSRC are working together on several High Performance Computing projects using HPCx. In collaboration with the U.S. National Science Foundation, Grids from the UK and USA were linked and supercomputing systems were simultaneously used to carry out interactive simulations, for example, on DNA modelling.

26. A collaboration including the CCLRC, the AHRC Research Centre for Studies in Intellectual Property and Technology Law and other University groups has established the Digital Curation Centre to address challenges of digital preservation and provide research, advice and support services to UK institutions. Part funded by EPSRC, the Digital Curation Centre will provide a national focus for R&D into curation issues and promote expertise in the management of all research outputs in digital format.

27. The CCLRC established, in 2003, the £1 million Technology Partnerships Programme with SR02 funding to participate in the cross-Council programmes on Stem Cells, Brain Science, and Post Genomics and Proteomics. In collaboration with leading medical or biological specialists this funding facilitates the transfer of CCLRC micro fabrication, detector and micro-electronics technologies to these disciplines.

Annex 4: Engineering and Physical Sciences Research Council (EPSRC)

RESEARCH COUNCIL SUPPORT FOR KNOWLEDGE TRANSFER

INTRODUCTION AND BACKGROUND

1. The EPSRC's 10 year vision for Knowledge Transfer is "that the UK should be as equally renowned for knowledge transfer and innovation as it is for research discovery". This vision clearly matches the Government's long-term strategy for improving the UK economy through investing more strongly in its knowledge base and translating this knowledge more successfully into innovation, as set out in the Science and Innovation Investment Framework (July 04).

2. EPSRC encourages industrial collaboration in all the activities it supports. Current expenditure promoting Knowledge Transfer is estimated to be 40% of the total budget. This amounted to approx. £200 million in 2004-05, broken down broadly into collaborative research (£132 million), collaborative training at postgraduate level (£61 million), and other activities (£1 million). This level of expenditure is expected to continue over the current spending review until 2007-08. For the years 2006-07 and 2007-08, EPSRC has been allocated an additional £2.968 million from the OST Knowledge Transfer (KT) Fund which will be used to support specific activities to promote better exploitation across the EPSRC portfolio.

3. Almost all aspects of EPSRC business have a Knowledge Transfer (KT) aspect, thus most staff play a role. The Director of the Research and Innovation Directorate holds prime responsibility for KT activities across EPSRC. Teams and groups have specific responsibilities for internal and external facing roles, including membership of appropriate bodies of Research Councils UK (RCUK), such as the Knowledge Transfer Group (KTG) and Research Directors Group (RDG).

4. In consultation with our relevant strategic advisory bodies and key stakeholders, we have reviewed and confirmed the role which EPSRC should play within pathways to better exploitation. This can be summarised as:

— A primary role in enabling the generation of Intellectual Property (new knowledge) in areas of national importance;

— A significant role in Knowledge Transfer and encouraging enhanced levels of business-university interaction (principally in partnership with third parties);

— A lesser role in the actual exploitation and commercialisation (ie revenue generation) of research into new products, processes, systems and services.

5. The global environment for the science base and business is becoming increasingly competitive and dynamic. The UK must retain its core strengths and values to remain attractive as a place to undertake research and innovation. Key to achieving this will be the development of a strong shared vision with business and other collaborating sponsors and partners. We are also aware that many universities are currently re-structuring in response to this changing situation and the recognition that companies will increasingly source knowledge which offers the best return on a global basis. Against this background, the key challenges for EPSRC are:

— To maintain current levels of collaboration whilst also promoting better quality interactions between business and academia;

— To strengthen our engagement with business and reach out to a broader cross-section of companies. This should result in increased business awareness and visibility for the activities that EPSRC supports;

— To stimulate enhanced user demand for research and subsequent pull-through of research into business.

6. The ways in which EPSRC addresses these challenges are set out in the following sections.

PROMOTING COLLABORATION BETWEEN INDUSTRY AND ACADEMIA

7. Many interactions between business and universities funded by EPSRC have their origins in "point to point" contacts between individual researchers and their colleagues in companies, often SMEs, in which we have had no direct involvement. Our role here is, nevertheless, to foster and maintain an environment in which such collaborations are valued and supported. We also recognise the need to work with intermediary organisations, such as RDAs, DAs, Faraday Partnerships, who are able to reach companies that we are unable to reach alone, and are pro-active in promoting collaboration through a range of instruments as set out below.

Collaborative Research

8. EPSRC funds collaborative research through both responsive mode and targeted strategic funding, where user collaboration is often mandatory. Since 1994, the level of such collaborative activity has increased 3-fold and currently stands at 43% (2004-05 spend). Examples of collaborative research supported:

— Innovative Manufacturing Research Centres (IMRCs): There are 17 IMRCs representing an EPSRC investment of £80 million. IMRCs are expected to attract matched funding (mostly in kind) from industry partners. The IMRCs currently collaborate with over 1,000 companies, many of them SMEs. A recent review found a high level of satisfaction for the IMRCs amongst industrial collaborators, primarily because the significant levels of long-term funding enable the development of more strategic relationships and plans, and allow the IMRCs to respond quickly to business needs.

A software package developed at one of the IMRCs is being used as a graphical tool to help designers work logically through their designs and provide a simple means for them to record their rationale. It has now been incorporated into the standard Product Lifecyle management tool set of a leading global engineering company.

— The National Technology Programme: EPSRC is a key funding partner in the Technology Programme and has been working with DTI on this activity since April 2004. EPSRC plans to commit up to £10 million pa from 2005-06 to the academic component of successful science to business projects. To date, we have committed approx £8.5 million funding towards 17 projects.

— Interdisciplinary Research Collaborations (IRC): These large scale activities involve consortia of academics from different disciplines and institutions in order to create a critical mass of expertise able to work together to meet a common challenge.

— The EQUATOR IRC involves eight universities and the Royal College of Art in investigations of technical innovation in digital and physical life. The consortium has worked in collaboration with a number of small and large companies within the creative industries to develop innovative approaches and products, which are being widely adopted.

9. We recognise the need to respond and adapt funding models to the needs of different sectors and research communities. The following activities demonstrate new, flexible approaches:

— Design in Technology Research: A pilot scheme funded by EPSRC and the Design Council to support interaction between designers and Engineering Advanced Fellows. The scheme demonstrated how the involvement of designers in the early stages of technology development can speed up the translation of technology to the market-place. Six 3-month projects looking at highly innovative and promising technologies were supported.

— The Ideas Factory: This approach brings together multidisciplinary teams of researchers and users for a week long "Sand-pit" to address significant business or societal challenges. Topics have included maintenance and renewal of the buried infrastructure, gun crime, closing the productivity gap and bridging the digital divide. Successful collaborative ideas that emerge from the sand-pits draw down from an earmarked sum of £1 million.

Collaboration in Postgraduate Training

10. We engage with universities, employers and other stakeholders in order to understand issues from the supply and demand sides of postgraduate training. We specifically encourage the development and supervision of post-graduate training within a business environment. Our aim is to help create a national workforce within the engineering and physical sciences to drive discovery and innovation and make the UK an attractive, and competitive, knowledge and skills hub within the global economy.

Key features of our 10 year postgraduate training strategy include:

— Attracting sufficient numbers of high quality students into postgraduate training in EPS to increase the attractiveness of research careers in the UK;

— Making postgraduate training more demand led and responsive to user needs.

11. Current support for collaborative training is approx. £60 million pa, largely provided through Collaborative Training Accounts (CTAs). CTAs are distributed to selected universities and account for about 40% of overall training provision. CTAs offer substantial guaranteed funding to universities and encompass all EPSRC schemes that link training to the workplace. The CTA mechanism offers great flexibility allowing research organisations to respond dynamically to the changing needs of industry.

CTAs provide businesses with:

— Clear visibility of the skills training on offer (especially for existing employees to re-enter education at masters or doctoral level);

— Single-point entry into individual universities;

— The option of different length relationships;

— The ability to leverage their financial input with that of other public (including RDAs/DAs) and private sector sponsors.

— The CTA mechanism will be reviewed in 2007. Key aspects of the review will include:

— The extent to which individual CTAs have fostered appropriate people flow in response to user needs;

— Adoption of best practice approaches to working with business.

A student from Newcastle University went on a Research Assistant Industrial Secondment to an innovative company that supplies films for speciality packaging, labelling, graphic arts and industrial products to apply a statistical approach to its polypropylene film production process. This process is now being managed more effectively with additional improvements in quality and productivity. He has subsequently been taken on by the company.

12. Examples of industrial collaboration on training:

— Industrial CASE: Industrial CASE is a three and a half year postgraduate award where the research is driven by the industrial collaborators. Most Industrial CASE studentships are supported through CTAs, but in addition to this companies are now able to bid into a pool of studentships. This is operated on a competitive basis with a particular focus on innovative SMEs. The aim of the pool is to open the scheme up to a much wider range of companies and provide a greater degree of flexibility in the use of the awards. Intermediary organisations (eg RDAs, DAs, and Faraday Partnerships) are encouraged to promote the opportunity locally in order to reach companies not previously known to EPSRC.

— Engineering Doctorate (EngD): The EngD is a work-based alternative to the traditional PhD, where students (known as research engineers) spend around three-quarters of their time working with their collaborating company. Industry partners have a key role in designing projects undertaken, in sponsorship and joint supervision.

People and Knowledge Flow

13. EPSRC believes that one of the most effective forms of KT occurs through people movement.

— Postgraduates: About one-third of all EPSRC research students' projects involve formal collaboration with industry. Around 50% of all EPSRC supported PhD students, and about 30% of research assistants enter the private, government and other public sectors. We are currently working with a number of Professional Institutions to improve our understanding of career paths and impact. CTAs enable postdoctoral research assistants to spend up to one year within their collaborating companies to embed the skills, knowledge and technology developed through the project within the company.

— Fellowships: The Industry Fellowships Scheme, administered through The Royal Society, provides good opportunities for two-way people flow between industry and academia. Of the 31 Industry Fellows in post over the past four years, 25 have been within EPSRC's remit. 19 of the Fellows moved from academia into industry, with the other 12 from industry to academia for their Fellowship. We will be increasing our annual contributions to the scheme from £200k pa to £250K pa from 1 April 2006 to 31 March 2009. We also co-fund a number of Post-Doctoral Research Fellowships with the Royal Academy of Engineering, to enable high quality engineers to quickly establish research careers.

A Professor from Newcastle University undertook a three year part-time Industry Fellowship with a leading microchip manufacturing company, where he was able to access a wider range of resources and equipment not available at the university. The experience has provided new technology for the company and further collaborative research projects between the university and the company funded by EPSRC.

Commercialisation

14. For the research and training activities we support, responsibility for Intellectual Property (IP) is delegated to the funded university. We expect universities to have suitable mechanisms in place to ensure appropriate exploitation and take-up of potentially commercial outcomes.

— Start-ups: A previous survey showed that some 500 start-up companies had been formed in the past decade that built on previous EPSRC funded research. Another survey, by the Royal Society of Chemistry, reported that 85% of spin-out companies from chemistry departments were based on technology arising from EPSRC-funded research.

Novel research at Cambridge on molecular materials for possible use as good semiconductor devices has led to the development of two highly successful spin out companies, Cambridge Display technology and Plastic Logic. The research group (under Professor Sir Richard Friend) has also received world recognition of pushing science boundaries through a review of their research in "Nature" (March 2005). Various independent studies have predicted a potential market size for flexible displays of $10-20 billion by ca 2010.

— IP training: We run (currently through Oxford Innovation) training courses on Intellectual Property for new academics and research fellows. Industrialists play a key role and are invited to present case studies.

— Integrated Knowledge Centres (IKCs): We plan to support two pilot "Integrated Knowledge Centres" (IKC) in 06/07 and 07/08. IKCs will:

— combine world class research with strong partnerships with business;

— be established in areas where the research field is emergent and there are business with the capability to exploit the resultant knowledge-base to create new market opportunities;

— provide a university campus-based environment to support the full, complex and multi-dimensional KT process;

— have considerable flexibility to develop an effective KT programme matched to the needs of business.

IKCs will engage in generating IP, Knowledge Transfer and exploitation and, for the first time, our support will provide some funding towards the costs of management of collaborative, entrepreneurial and commercial services. EPSRC funding of £7m over 5 years will be provided for each pilot. IKC teams will be expected to secure additional funding from business and the RDAs/DAs are likely to play a significant role.

— Funding for commercialisation is also available through the RCUK Follow-on Fund and Business Plan competitions in which we take an active part.

STAKEHOLDER ENGAGEMENT AND COMMUNICATION

15. EPSRC engages with business in a variety of ways, many of which interplay with each other in order to build up a rich set of interactions. We see opportunity to increase such interactions across most of our operations, and to increase the quality of those where the greatest benefits are likely to be. Some examples of the types of current interactions with business and other stakeholders are:

— Policy making: Business is well represented on the EPSRC Council, and its two advisory bodies, the Technical Opportunities Panel and the User Panel (UP). The membership of UP is almost entirely from business.

— Strategic Advisory Teams (SATs): SATs provide EPSRC programmes with advice on research and training and 30% of all SAT members are from industry. We recognise the major importance of taking account of public opinion in policy and strategy development. In light of this a new Societal Issues Panel will be established in 2006.

— Peer Review: About 20% of the current EPSRC College (2003-05) is made up of non-academics, 50% of whom (360 in total) are from business. Individuals from business also make up about 10% of the members of peer review assessment panels.

16. EPSRC plays a proactive role in raising the appetite of business for interactions with the science base. Examples of how we are doing this:

— Sector Work: This important EPSRC activity involves14 sector teams, comprising some 60 members of staff. The key aims of sector work are to:

— increase involvement of all users in EPSRCs longer-term strategic thinking;

— develop strategic partnerships between EPSRC and users;

— increase the general awareness of EPSRC amongst the user community through wider communication and consultation;

— stimulate academic-user collaboration on research grants and training awards;

— increase exploitation of research and training outcomes and knowledge transfer;

— build and sustain a better knowledge and understanding of user needs within EPSRC.

Sector team members have undertaken a variety of "company placements" with eg Thames Water, Smith and Nephew, IBM, Rolls Royce, GSK, BNFL and Scottish Enterprise. Sector teams also visit individual companies to raise their level of engagement both with EPSRC and the academic base.

The Software, Media and Communications Sector represents a significant part of our interactions with the businesses in the creative industries, such as graphic design, computer games, music technology, broadcasting and publishing.

— Company Account Managers: To improve the EPSRC/industry interface we will assign company account managers to key companies that are keen to work with us.

— Technology priorities: Recently, we developed a set of sector relevant technology priorities as an initial step towards producing a technology strategy. The technology strategy will provide a framework for setting priorities, improve the effectiveness of business-university research collaboration and optimise our alignment with the national Technology Programme and other partners and sponsors.

— Strategic Alliances: We have developed a number of strategic alliances with companies to develop better shared understanding and greater levels of engagement. By October 2005, EPSRC had 32 strategic alliances, some of which developed further into formal funding partnerships, including strategic funding partnerships with leading companies. We have also co-funded with industry a number of "star recruits" in areas of identified business or societal need where there is a current lack of expertise within the UK academic base.

The virtual centre of excellence in Non-Destructive Evaluation (established in April 2003) is a strategic partnership between EPSRC and a consortium of companies. The centre has a core research element of £1.5 million EPSRC funding for blue skies research and a further £6 million over five years, of joint EPSRC/industry funding for more strategic research.

Recent examples of "star recruits" include Chairs in: "Castings research" (Rolls Royce—Birmingham University); "Flight deck operation" (Civil Aviation Authority—Cranfield University); and "Knowledge transfer" (Qinetiq—Imperial College).

17. EPSRC staff actively participate in relevant industry bodies such as DTI Innovation and Growth Teams, Leadership Councils, National Advisory Committees for Aerospace and Defence, Committees of the Professional Institutions and other organisations, such as ICARG of the CBI, and also RDA Science-Industry Councils.

18. The EPSRC website hosts a "Grants on the Web" facility that allows anyone with access to the web to find information on the research supported, classified by research topic, organisation, programme, industrial sector or free text search. A number of publications; "Newsline", "Spotlight" and "Connect" provide the external community with regular progress updates on funding opportunities, policy directions, and case studies of the outcomes and impacts of successful research and training activities.

RESULTS AND PERFORMANCE MANAGEMENT

19. We have developed an internal performance and risk management system using a balanced scorecard approach. The scorecard contains all of the key performance indicators for EPSRC, including those for knowledge transfer, and integrates them with the council's strategies, risks and information on the resources available to deliver. It is planned that the system will become operational from 1 April 06.

20. As part of the performance and risk management system we have established a set of performance metrics to monitor progress against the PSA Output 2 target "Better Exploitation". These were agreed with the RCUK Knowledge Transfer Group and approved by OST. The broad headings against which performance will be measured are:

— Interaction with business and public services;

— Collaborative Research;

— Commercialisation of Research;

— Cooperative Training;

— People Exchanges between the Science and Engineering Base and Users.

Both the scale of the activity and quality of the activity will be measured by the indicators used. As well as monitoring current activities, the downstream outputs and impacts of our investments will also be monitored and assessed.

21. Examples of how EPSRC is monitoring the success of its investments:

— Collaborator Survey: It is important that we understand the value that companies get from collaborating on research and training activities. We are currently developing plans for a pilot survey to engage directly with industry partners to gauge levels of collaborator satisfaction on the research grants that we support.

— Timeline Case Studies: Timeline case studies are being developed looking at how the outputs of previously funded EPSRC research have been taken-up into industry. This will help towards providing a qualitative measure of value for money of the research supported.

SUMMARY

22. EPSRC has a strong and multifaceted Knowledge Transfer portfolio. The levels of engagement and partnership with business and other partners is high and significant, and in some cases particularly deep through formalised strategic alliances and funding partnerships. The current Delivery Plan 2005-06 to 2007-08, maintains our commitment to a strong and vibrant Knowledge Transfer activity, responsive to the needs to business and society in helping to create the conditions for improving prosperity and quality of life in the UK.

Annex 5: Economic and Social Research Council (ESRC)

RESEARCH COUNCIL SUPPORT FOR KNOWLEDGE TRANSFER

EXECUTIVE SUMMARY

1. This paper explains the mission of the Economic and Social Research Council (ESRC), its strategic drivers, and the contribution that Knowledge Transfer makes to achieving the organisation's mission.

2. A brief explanation is given of the establishment of the small Knowledge Transfer Team following an internal reorganisation; its staffing complement; and the resources it has been allocated.

3. The achievements of Knowledge Transfer are reported in the context of the organisation's Knowledge Transfer Strategy that was approved in April 2004. The strategic actions which have yielded many positive outcomes since that date will be developed and expanded, particularly after additional OST funding becomes available from 1 April 2006.

4. Plans for the future are succinctly summarised using the five headings shared by all Research Councils in the Output 2 framework.

ORGANISATIONAL CONTEXT

5. The ESRC's mission is to:

— Promote and support, by any means, high quality basic, strategic and applied research and related postgraduate training in the social sciences.

— Advance knowledge and provide trained social scientists who meet the needs of users and beneficiaries, thereby contributing to the economic competitiveness of the United Kingdom, the effectiveness of public services and policy, and the quality of life.

— Provide advice on, and disseminate knowledge and promote public understanding of, the social sciences.

6. The ESRC conducted a major national consultation in 2004, within and beyond the social science community. This activity followed the appointment of a new Chief Executive, Professor Ian Diamond, and a significant internal reorganisation.

7. At that time the ESRC adopted four key drivers that influence the way it operates: Research; Capacity; Engagement; and Performance. Of these, Engagement is the most relevant to Knowledge Transfer as it "emphasises the importance of promoting social science and engaging in dialogue with stakeholders to apply research to policy and practice and increase its relevance to potential users".

8. Drawing on last year's consultation, the ESRC has prepared a strategic plan in which one of its strategic objectives is "to engage with stakeholders by a full range of knowledge transfer and communication activities". The plan identifies strategies and sets out goals that will be achieved by 2010.

9. The implementation of the ESRC's Knowledge Transfer Strategy will contribute significantly to the achievements of those goals.

KNOWLEDGE TRANSFER: STAFFING AND RESOURCES

10. The Knowledge Transfer Team was a new entity created in the 2003 re-organisation, although it did not become operative as a unit until 26 January 2004. The team is located within the Communications and Information Directorate, alongside and interacting with the Communications, Evaluation and E-Business teams.

11. There are 4.8 FTE staff (of whom 3.6 are policy managers, and 1.2 support personnel). The Team also supports a 0.5 Research Co-ordinator on behalf of the Local Authority Research Council Initiative (LARCI) which provides policy and practice relevant research from most Research Councils for application in over 400 local authorities.

12. Two further staff will be added from 1 April 2006.

13. In 2004-05 the Team's budget for knowledge transfer activities was £300,000. This was increased to £620,000 in 2005-06. In addition, the ESRC made a contribution of £15,000 to LARCI in both years.

14. Media and public relations, some events, some publications and the interactive portal are funded separately. In addition, the ESRC's centres and programmes as well as grant holders have a small percentage of their budget for communications, dissemination and knowledge transfer activities. It is estimated that £1.5 million would be spent annually in this way.

15. It is also recognised that the teaching function carried out by academics is an important means of knowledge transfer, although it is not a focus of this paper.

16. All studentships have a knowledge transfer function, but there are several schemes where this is particularly emphasised. The ESRC currently allocates £2.7 million to CASE, and £831,000 to Knowledge Transfer Partnerships. £25,000 is allocated to the Business Plan Competition and a similar amount for students who spend three months during their doctorates in a placement scheme operated in conjunction with the Parliamentary Office of Science and Technology.

17. From 1 April 2006, the ESRC will receive about £147,000 for each of two years from the Research Council—Regional Development Agency Capacity Fund; and a total of £1.244 million for the same period from the OST allocation.

IMPLEMENTING THE ESRC'S KNOWLEDGE TRANSFER STRATEGY

18. This section of the paper explains the context in which the strategy was developed; its rationale; its implementation; and achievements. It will evolve in response to changing circumstances' but has an evidence base through stakeholder consultation and engagement.

BACKGROUND

19. The ESRC has been influenced by several key reports:

— Lambert Report on "business-university collaboration"

— Innovation Report on "Competing in the Global Economy".

— Government's "Science and innovation investment framework 2004-14"

20. ESRC accepts the imperatives for Research Councils set out in these reports to increase:

— Rate of knowledge transfer

— Interaction with business

— Amount of collaborative research

— The ESRC's stakeholder engagement consultations and surveys.

DEFINITION

21. For the ESRC we regard knowledge transfer "as involving processes of translation and transformation where there is an interdependence between knowledge and practice (including but not limited to business processes, technological development, policy development and implementation, and the delivery of services) that occur in organisational and institutional settings in which social networks are important".

22. Consequently the ESRC places an emphasis on facilitating and mediating processes that allow new knowledge to be generated, interpreted and utilised in a range of social and economic settings.

THE ESRC KNOWLEDGE TRANSFER STRATEGY

23. Following consultation, the ESRC's Knowledge Transfer Strategy was approval by Council in April 2004. The full document sets out: Context; Definition; Vision; Values; Mission Statement; Strategic Delivery Actions; Specific Actions; and Challenges.

24. In this paper the focus is on the achievement of the Strategic Delivery Actions, each of which is considered in turn.

ENGAGING ACTIVELY WITH ESRC'S KEY STAKEHOLDERS

25. Rationale: Our stakeholders form vital strategic alliances with the ESRC as generators, interpreters, consumers, disseminators, funders or stimuli of new knowledge through research and its application. Our stakeholders include those in the public, private, community and voluntary sectors as well as those in academic institutions.

26. Achievements: We have transformed informal links with several Government departments into strategic partnerships with 10 Government departments; all three devolved administrations in Northern Ireland, Scotland and Wales; and the National Council for Voluntary Organisations (NCVO).

27. Formalised annual meetings are held at which each partner's organisational context is reviewed; relevant research identified and foreshadowed; past agreed actions reviewed; and future collaborative actions identified. Ongoing dialogue is maintained.

28. Outcomes include:

— Jointly-funded studentships

— Public policy seminars (for which the Government agency is invited to identify a topical policy which is addressed at a seminar by selected researchers and a publication prepared by a science writer).

29. Topics have included: School leaving age influences; Road Pricing; Obesity; Demographic changes in Scotland; Productivity; Corporate governance; Poverty and income distribution in Northern Ireland:

— Joint research

— Research methods workshop

— Research brokering to identify expertise

— Invitations to events

— Distribution of research findings

30. We have engaged with the business sector by:

— contributing to the research council—CBI led consortium—ICARG

— sponsored students on knowledge transfer schemes to work on projects in business or undertake research in these organisations

— engaged in bi-lateral discussions with several large corporations to identify and apply research that is relevant

— sponsored seminars and workshops for business sectors eg insurance; financial services; health; banking

— organised seminars on economic trends or work futures that provide a context in which businesses operate

— held discussions with businesses on dataset and other research resource requirements

31. We have strengthened relations with regional authorities by:

— Co-organising a national conference on "Regional Policy" with the Association of Regional Observatories

— Co-organising a national conference on "Skills" with the ARO

— Organised a seminar on "Regional Funding" that drew on Treasury and DTI input

— Contributing directly to events organised by RDAs

32. We have provided the support and base for the establishment of a 0.5 Research Coordinator who draws on the resources of most Research Councils to respond to the policy needs of local authorities through LARCI for which the principal sponsors are the ESRC and the Local Government Association. Four seminars have been held, including Transport, Ageing, and Education, a quarterly newsletter produced, and a website managed as well as providing a brokering service for local authorities.

33. We have signed a formal concordat agreement with NCVO as a key umbrella organisation for community and voluntary organisations. A new research programme has been launched, Non-Governmental Public Action, and award holders introduced to how to engage in knowledge transfer activities. A public policy seminar was held at NCVO on "Charitable Giving and Donor Motivation".

34. In addition to the ESRC's consultation survey among its stakeholders which argued for more responsive mode funding and greater user engagement, the Knowledge Transfer and Communications Teams combined to conduct a survey among stakeholders that asked them their perceptions of the services provided. The findings of this survey have generated a management plan for future engagement activities.

MANAGING KNOWLEDGE TRANSFER SCHEMES

35. Rationale: These schemes make a significant contribution to three key elements of ESRC's Strategic Framework—they generate new research, they help build capacity and they epitomise engagement as they prompt interaction among multiple institutions.

36. We have actively promoted these schemes. For example, by initiating a publicity campaign applications for CASE awards increased by over 50% and the number of awardees increased from 70 to 85 in 2005. For example, the number of Knowledge Transfer Partnership applications exceeds the funding available.

37. We contribute actively to the Knowledge Transfer Partnerships Management Board and have used this setting to develop co-sponsored arrangements to increase the number of Associates in social science activities. ESRC served on the judging panel for the KTP annual awards.

38. We have contributed staffing and financial resources to the cross-Research Council Business Plan Competition.

ORGANISING KNOWLEDGE TRANSFER EVENTS AND PROCESSES

39. Rationale: To respond to the reality that people learn in different formats and at varying stages, we organise a variety of processes and activities that facilitate interactions between researchers, practitioners; policy makers and other users.

40. We have organised public policy seminars, conferences, workshops, colloquia—In addition to those identified in the section on "Engaging with stakeholders', "Making the Connections: Governing in Partnership for Sustainable Communities—Wales Approach to Public Sector Reform"; and "The Commission for Africa and the G8: Towards a New Policy for Tertiary Education and Capacity Development in Africa."

41. ESRC has established an interactive portal that allows those who use it to access a wide variety of research findings, identify expertise, and engage in discussions on-line.

42. We co-sponsored and helped organise a national conference on "Social Policy and Social Care" that drew international and UK researchers, policy makers, and practitioners from diverse social care settings.

43. We collaborated with the Communications Team to organise and then assess the effectiveness of Social Science Week, a focused service of 48 events in June 2005 that highlighted the contribution of social science research to the UK's economic and social well being.

PROVIDING LEARNING, TRAINING AND DEVELOPMENT OPPORTUNITIES

44. Rationale: We create opportunities for our stakeholders to learn new ideas and approaches as well as update their knowledge.

45. We commissioned and managed the development of a new major web-based resource, the Knowledge Transfer Guide which serves as a companion to the Communications Toolkit. The KT Guide draws on research to identify the important principles of knowledge transfer; explains different methods and approaches; and presents case studies of best practice. Opportunity is given to those who access the resource to engage with others to benefit from exchanging experiences.

46. We organised two workshops, "Getting Research into Practice," for those on funded ESRC programmes. The workshop content included the principles of knowledge transfer, alternative means of user engagement, evidence from research and input from policy makers who draw on research as well as researchers who have actively engaged in policy development.

47. ESRC organises workshops for researchers to engage with the media; politicians on contemporary social and economic issues; and research on political processes.

OFFERING A HIGH QUALITY BROKERING SERVICE

48. Rationale: In addition to the formal/semi-formal systems and processes identified in previous sections, Knowledge Transfer also facilitates a central role in enhancing networks and satisfying its stakeholders by providing advice, sources of information, summaries of research, identifying expertise and making available research reports.

49. We have maintained a broad knowledge of ESRC research and national developments so that we can provide a high quality brokering service of informal advice.

50. More formally, the ESRC Council approved the appointment of two types of knowledge brokers. One will work with the Communications Team and provide a conduit between researchers in an area of common interest and audiences by using the media and publications as key vehicles. The other will be associated with the Knowledge Transfer Team and will be intermediary between researchers, business and policymakers in regional settings.

ASSESSING THE CONTRIBUTIONS RESEARCH, KNOWLEDGE TRANSFER SCHEMES, EVENTS AND OTHER ACTIVITIES MAKE TO KNOWLEDGE TRANSFER

51. Rationale: Given our commitment to the utilisation of knowledge, we believe that is it important to assess the impact of the activities we support and organise so that we can improve our processes as well as judge the value of what we do.

52. We have followed up over 100 end-of-award reports considered 9-12 months earlier by the Evaluation Team. We look for evidence of user engagement during the research enterprises, how it evolved, and its impact and best practice examples. Worthwhile case studies are identified and commissioned to provide training resources or are linked to the Knowledge Transfer Guide as a model to others.

53. We have, with Communications, conducted a survey of Social Science Week participants in 2004 and 2005 not primarily to evaluate individual events but to understand how the research findings that are presented are utilised by attendees. They are also followed up 10-15 weeks after Social Science Week and asked what they did with the contacts they made and the new information they gained. Findings have influenced advice to event organisers.

PLANNING AHEAD

54. Whereas the previous section drew on the ESRC's Knowledge Transfer Strategy to highlight the achievements in this area over the past 18 months, the next section uses the Output 2 Framework to summarise plans for the next three years.

INTERACTION WITH BUSINESS AND PUBLIC SERVICES

55. Active concordats will be expanded (more activities with existing partners) and new partners added eg DfID, FCO, ONS, RDAs, strategic alliances with umbrella organisations in the business sector; and specific companies will be developed. The April 2006 staff appointments will have this activity as a primary focus.

56. Alliances with RDAs will be strengthened, in part using the RC-RDA Capacity Fund and the ESRC brokers' scheme.

57. Knowledge transfer activities with local authorities will be enriched based on a business plan that is being jointly funded by ODPM and LARCI.

58. Interaction with the community and voluntary sector will increase, building on the concordat signed with the NCVO, and accessing funds from the Big Lottery Fund.

59. The number of public policy and business-oriented seminars and workshops will double.

60. Our Impact Grants Scheme has been introduced as a pilot to provide resources for centres and large grants to undertake knowledge transfer activities to facilitate the utilisation of their research findings.

61. User representation on ESRC bodies and external ESRC representation will increase. The Communications and Information Committee (CIC), a sub committee of the ESRC Council, which advises on Knowledge Transfer and Communications activities, should be an exemplar.

COLLABORATIVE RESEARCH

62. As required by the Innovation Report, the amount of collaborative funding that the ESRC will generate will increase. The ESRC has established a Venture Fund which is designed for this form of funded research.

63. Initial projects include demographic trends in Scotland and preventative public health research.

64. The number of jointly funded research projects will also increase. Potential partners are seeking opportunities to fund research jointly with the ESRC.

COMMERCIALISATION OF RESEARCH

65. The ESRC will organise workshops, either on its own, or with partners (eg AURIL) to develop the entrepreneurial and commercialisation skills of its researchers.

66. The ESRC will sponsor research and make its findings readily available on spinout companies and other commercialisation processes.

67. Knowledge Transfer is planning a weeklong residential course on entrepreneurship for its studentships holders, jointly funded with RDAs and the Scottish Executive, and facilitated by the Cambridge-MIT consortium.

68. Knowledge Transfer will continue to co-sponsor with other Research Councils the Business Plan Competition that provides business development skills for teams who have a potentially commercial idea that they wish to develop.

CO -OPERATIVE TRAINING

69. One of the reviews that the ESRC is currently conducting is on the effectiveness of its knowledge transfer schemes, particularly CASE, Knowledge Transfer Partnerships, jointly-funded studentships with Government departments as well as the knowledge transfer function of standard studentships. Initial findings suggest that those schemes which emphasise interaction between business and academics through doctoral students or graduate associates are seen as being worthwhile and beneficial by all parties involved—employers, academics and graduates. If these findings are confirmed in the final report, the ESRC would look to expand those schemes that are effectively fulfilling their purpose.

70. Knowledge Transfer will continue to monitor the impact of these schemes and collect case studies of good practice so that all parties can maximise the benefits they get from being involved.

PEOPLE EXCHANGES BETWEEN THE SCIENCE BASE AND USER ORGANISATIONS

71. The ESRC has introduced a research brokers' scheme to appoint intermediaries to facilitate interaction between those who apply research findings and those who generate new knowledge.

72. The ESRC has approved a Placement Scheme whereby researchers will spend time in a Government department providing the research evidence that can be drawn on to develop or review policies. As well, Fellows on this scheme will be expected to run workshops on the research methods in which they gave expertise.

73. Should this scheme be successful, Government employees will be supported to spend time with ESRC researchers in academic units to work on policy-relevant research projects.

74. Placement Schemes will then be extended to the business and voluntary sectors.

75. Knowledge Transfer will continue to give recent graduates workplace experience following introduction of a new scheme in August 2005.

Annex 6: Medical Research Council (MRC)

RESEARCH COUNCIL SUPPORT FOR KNOWLEDGE TRANSFER

INTRODUCTION

1. The mission of the Medical Research Council (MRC) is:

— To encourage and support high-quality research with the aim of improving human health.

— To produce skilled researchers, and to advance and disseminate knowledge and technology.

— To improve the quality of life and economic competitiveness in the UK.

— To promote dialogue with the public about medical research.

2. The 50+ years since the discovery of the structure of DNA have seen extraordinary advances in basic biomedical science and its application to tackling medical problems. The MRC has been at the forefront throughout that time. Our achievements include major impacts on health and the development of new breakthrough technologies applied by industry (see below), as well as fundamental insights into biological systems.

3. Some impacts of MRC research on health:

— Establishing that smokers lose a decade of life compared to non-smokers.

— Showing that surgery for stroke can halve the risk of a subsequent one.

— Demonstrating that screening for abdominal aortic aneurysms is cost-effective, saving over 3,000 lives after four years in the 65-74 age group.

— Showing that cholesterol-lowering drugs can reduce the risks of heart attacks and strokes by at least one-third.

— Saving NHS resources and lives, by showing that corticosteroids in severe head injury do more harm than good.

4. Some examples of MRC activity leading to the use of new technologies in industry and healthcare

— Funding the initial research behind the MRI scanners now present in every main hospital.

— Developing "humanised" monoclonal antibodies, now used by industry as the basis of a whole new class of antibody-based treatments.

— Funding many technological breakthroughs (eg DNA and protein sequencing, DNA chips and phage display) that have underpinned the genome programme and the biotech industry.

— Creating 16 start-up companies employing over 1,000 people.

5. The next decade will see two main thrusts. Firstly, advances in knowledge at the molecular level will rapidly be extended to a more integrative scale: increasing understanding of how cells, organs and organisms function, grow and develop—in health and disease. The emphasis will be on multi and inter-disciplinary approaches. Secondly, there will be a far greater focus on translating the results of such work into improved healthcare, products and services. Increased understanding of the social, behavioural and psychological factors involved in ill-health will result in new approaches to promoting public health.

6. The MRC Delivery Plan describes how we will use our resources during the current Spending Review period (2005-06—2007-08) to contribute towards achieving the Government's objectives for the science budget, set out in targets for the OST and in the Science and Innovation Investment Framework. The Plan explains how the MRC will help implement the Government's medical research agenda, as well as the MRC's own vision and strategic priorities, accelerating the pace with which MRC research helps to achieve national health and economic goals (see below).

MRC FUNDING AND STRATEGY

7. The Council believes that the particular challenges in delivering a broad research agenda with the ultimate aim of improving human health require the following range of approaches to research funding in MRC:

— Intra-mural support—MRC Units and Institutes located in/closely integrated with research-intensive universities and, where appropriate, hospitals

— Extra-mural support—with research funding for researchers through a range of grant schemes, and

— Personal award (Fellowships, studentships) for research training and career development.

8. MRC retains the Intellectual Property rights for research within its own Units and Institutes, but for extra-mural research the Host Institution manages these rights.

9. MRC funding was £435.5 million in 2004-05 with the following distribution by scientific area:

39% molecular and cellular medicine

15% physiological systems & clinical sciences

17% neurosciences and mental health

16% infections and immunity

13% health services & public health

7. MRC priorities include:

— Clinical Research and Public Health

— Infections and Vaccines

— Biomarkers

— Stem Cells

— Maintaining health of disciplines

THE CLINICAL RESEARCH AND PUBLIC HEALTH AGENDA

11. Clinical research is at the heart of the MRC's mission to promote research that will improve and maintain health. We have a long history of supporting a wide range of clinical research and of training future leaders of clinical research. Clinical research (see Figure) is designed to answer questions about human disease—its causes and origin, prevention, diagnosis, outcome and treatment. It is first and foremost about people and is pivotal to a continuum that extends from the laboratory, to patients, and through them to the health of the whole population. And the flow is not only one-way. It is becoming increasingly clear that just as basic science can lead to better patient care, so studies in people can provide key insights for basic science.

12. The MRC is active in relevant areas of basic, translational and clinical research, and is well placed to play a big role in this new push to improve health. Our public health research looks at the wider influences on physical and mental well-being and ill-health; for example, the biological, socio-economic, lifestyle and environmental factors at play throughout people's lives. It includes all aspects of health promotion, disease prevention and healthcare provision. A key aim is to understand how and why ill-health varies within the population, and how to improve public health through interventions and improvements that address these inequalities. A call for proposals in methodology including research which develops knowledge about how to implement research findings in policy and practice was issued in December 2005. The MRC conducts a wide portfolio of clinical trials across the spectrum of disease and tests new approaches to prevention, diagnosis and treatment.

13. The MRC has been allocated £25 million new money during the SR2004 period to take forward the clinical and public health research agenda, and will be redeploying a further £37 million of its existing funds from 2005-06 onwards to this end. Therefore the MRC expects to allocate an extra £62 million to drive forward the clinical and public health agendas, raising its annual spend from £127 million per annum to about £162 million per annum by 2007-08, as described in its Delivery Plan.

14. The MRC's strategy for strengthening translation of basic research into direct clinical and economic benefits is to:

— Increase support for experimental medicine—patient and volunteer studies based on the latest basic knowledge. A call for proposals in experimental medicine was issued in September 2005 and focused on the early testing of novel treatments or interventions in human participants.

— Raise funding for clinical trials and other population level studies; for example, on interactions between environment, behaviour and predisposition to disease.

— Promote translational research approaches—where there is a vigorous exchange of ideas, methods, people and priorities between basic and clinical sciences. A Call for Centre Grant applications to strengthen translational research in the UK was issued in January 2006. The MRC will create a new cadre of research translators to further promote knowledge transfer.

15. The Government has asked the MRC and the Health Departments to build on their existing partnership and further accelerate the translation of basic research results into improved health. As well as participating in the UK Clinical Research Collaboration, MRC and the Health Departments have set up a Joint MRC / HDs Health Research Delivery Group (chaired by Sir David Cooksey) which aims to provide enhanced strategic co-ordination between the public funders of medical research.

16. The Joint Health Delivery Group, as part of its work, is developing an overarching strategic plan for working with industry, from pre-competitive preclinical research through to large scale clinical trials. Care is being taken to co-ordinate, and not duplicate, effort with the activities of UKCRC on clinical trials in this area.

BIOMARKERS INITIATIVE

17. The shift towards a more holistic approach to the study of health and disease, as exemplified by systems and integrative biology, provides new impetus for developing the science of biomarkers. Dramatic advances in "-omics" technologies have led to high expectations for the emergence of a new range of biomarkers, providing deeper insight into the behaviour of disease and response to drugs, which will allow quicker development of novel therapies of proven benefit. A UK conference on Biomarkers, sponsored by the MRC is being held in January 2006 to address the extent to which this expectation can be met and identify how the UK can best contribute to the international research effort in this area through capitalising on its infrastructure and scientific strengths. Participants will be drawn from academia, the pharmaceutical industry and drug regulation, covering a variety of cross-cutting medical disciplines.

Commercialisation of R&D

18. MRC collaborates with industry on a broad basis and takes a proactive approach to engaging industry through our affiliated company—MRC Technology (MRCT). MRCT is responsible for exploiting the intellectual property rights (IPR) from research in MRC research establishments (institutes and units). MRC's objectives in technology transfer are:

— to work through the mechanism, and with the partner(s) judged most likely to develop MRC technology into products and services useful to Society;

— to maximize the contribution to national wealth creation and UK industrial competitiveness;

— to maximize income to the MRC in the medium-to long-term.

19. Between 1987 and 2004, MRC received over £102 million income from exploitation of its IPR, and granted around 457 licences. MRC's commercial income was £28.5 million in 2004-05. Expenditure on commercialisation was £9.3 million. This level of licence income is equivalent to 9.17 per cent of research expenditure on MRC institutes and units which, on the basis of the most recent comparative figures available, is more than three times the proportion achieved overall by US universities and around 15 times the level in UK universities.

New class of pharmaceuticals

20. MRC research in antibody engineering started in the mid 1970s. MRC patents cover a series of inventions from the MRC Laboratory of Molecular Biology during the late 1980s and early 1990s for making `humanised' or fully human monoclonal antibodies. These technologies have had a major impact on health and the economy in the last decade. Eleven therapeutic antibody products are now marketed arising from MRC patented technologies (antibody humanisation and phage display), including treatments for breast cancer, leukaemia, infant respiratory disease, asthma, psoriasis, kidney transplant rejection and rheumatoid arthritis. 32 more products are in late stage (Phase II and III) clinical trials.

21. In late 2005, MRC signed one of the biggest deals to come out of breakthroughs by UK scientists. It involves a drug created using patented antibody technology derived from research at the Laboratory of Molecular Biology and the Scripps Research Institute in California. The drug, HUMIRA(r), is so far used to treat rheumatoid arthritis, early rheumatoid arthritis and psoriatic arthritis. The American pharmaceutical company, Abbott has agreed to pay money in lieu of the future royalties the MRC, the Scripps Research Institute and Stratagene would have received on sales of HUMIRA(r). The MRC has received £112 million as a result of this deal.

MRC Start-up Companies

22. Two of the largest UK biotechnology companies, Celltech and Cambridge Antibody Technology originated as start-ups based on MRC technologies and fifteen other MRC start-up companies have either merged with others prior to listing or have attracted substantial venture capital or corporate financing as private companies.

23. In March 2005, Ardana Bioscience Ltd, became the first MRC start-up company since Cambridge Antibody Technology (CAT) to be floated directly on the London Stock Exchange, although some other listed biotechnology companies such as Vernalis and BioFocus derive in part from MRC start-ups which merged with other entities. The listing raised £21 million before expenses. Ardana, a biotechnology company based in Edinburgh, was created in 2000 on the basis of licences and options to intellectual property arising in the MRC Human Reproductive Sciences Unit. Although Ardana subsequently acquired rights to nearer to market products from other companies, it continues to develop earlier stage technologies arising in the Unit and, prior to listing, agreed a revised and more focussed option agreement with MRC that will take effect in July 2005. Under the agreement MRC received further shares, a royalty provision and funding for additional research in the Unit.

24. The number of employees in MRC start-up companies (excluding Celltech) was 1,135 at March 2005.

MRC Development Gap Funding

25. Following a successful pilot scheme, MRC in 2003 approved a £4.5 million proof of concept fund managed by MRCT to support further research and reduction to practice on initial results with commercial potential that arise in MRC establishments. The research is project-managed to deliver to commercially relevant targets. Through this mechanism, MRC is able to develop its intellectual property into more robust and commercially attractive opportunities. The earliest projects are now complete or nearing completion and efforts are underway to partner or license the IPR generated. A symposium for project leaders was held in September 2005.

26. The Development Gap fund has also been used to leverage interest in speculative research, with potential commercial application, from industry. One example of this is a three-year collaboration between MRC Laboratory of Molecular Biology and Pfizer the world's biggest pharmaceutical company on the three-dimensional structure of human G protein coupled receptors—a class of drug targets that have been key to advances in the search for medicines to treat conditions where medical need remains high.

MRC Drug Discovery Group

27. MRCT's own dedicated applied research laboratories have helped bridge the gap between basic research and the needs of industry. The MRC is also creating a Drug Discovery Group to identify and progress MRC research offering starting points for drug discovery, to aid translation of basic science and improve commercial exploitation. The group is being built on existing strengths within MRCT, which already has a group of scientists who screen potential drugs at its laboratories in Mill Hill, north London. A significant group of medicinal chemists will be recruited and the biology group will be expanded, with the objective of creating an enhanced screening capability and `hit to lead' chemistry to help accelerate the translation of MRC's cutting edge biology into innovative new therapies. The Group's remit will span the entire range of research fields funded by the MRC, including potential drug targets in neglected diseases and prospective targets currently regarded as too high-risk by the pharmaceutical industry. As with MRC's investment in antibody humanisation, the DDG is a long-term strategic investment and healthcare and economic benefits are expected in a 10-15 year timescale.

COLLABORATIONS WITH INDUSTRY

28. In addition to work carried out within MRCT's laboratories, MRC Institutes and Units are encouraged to engage in collaborative research with industry. A striking example is the collaboration between the MRC Protein Phosphorylation Unit, and the University of Dundee's School of Life Sciences with six of the world's major pharmaceutical companies—AstraZeneca, Boehringer Ingelheim International GmbH, GlaxoSmithKline, Merck Co, Inc (of Whitehouse Station, NJ, USA), Merck KGaA (of Darmstadt, Germany) and Pfizer. In 2003 the companies agreed to provide further funding of more than £15 million over five years to investigate two classes of enzymes, termed kinases and phosphatases, which have become some of the most important classes of drug target in the pharmaceutical industry. Overall the collaboration will have provided funding in excess of £21.5 million over ten years and supported the creation of over 20 new scientific posts within the specially created Division of Signal Transduction Therapy. Novel pathways and targets have been dissected and a number of patent applications licensed by MRC to partners within the consortium and more widely.

MRC SHOWCASE DAYS

29. MRC and MRCT are planning a series of theme-based Showcase Days to improve communication between MRC-funded scientists (intra- and extramural) and Industry. The objectives are to strengthen links in the UK bioscience community and to develop new collaborative research programmes between academia and Industry.

OTHER INTERACTIONS WITH COMMERCIAL USERS

30. MRC also contributes to knowledge transfer through:

— Sponsorship of LINK programmes (most projects supported are university-based). MRC is a co-sponsor with BBSRC and DTI of the Applied Genomics LINK Programme.

— Collaborative Studentship Awards.

— Industrial Collaborative Studentship awards.

— Encouragement of industrial consultancies for MRC staff within guidelines and where approved by management.

— Financial support to, and assistance with managing, the joint Research Council Business Plan Competition and the Biotechnology Young Entrepreneurs Scheme.

— Support of MRC Conferences with academic/industrial participation.

— Training by MRCT staff in Intellectual Property and commercialisation for newly appointed MRC scientists in units and other seminars given by MRCT staff to University postgraduates.

— MRCT staff making a major contribution to the Praxis training programme for technology transfer professionals.

PEOPLE AND SKILLS

31. The MRC's priorities in research training include implementing relevant recommendations of the Roberts Review concerned with enhancing the attractiveness of research careers and the standard of training. MRC funds about 400 new PhD students each year. The MRC is also increasing flexibility in the provision of postgraduate training through Doctoral Training Accounts (DTAs). In integrative physiology/pharmacology, which are priority areas for strengthening, MRC is partnering a consortium of pharmaceutical companies which has set up a fund to support in vivo research and training at PhD and postdoctoral level.

OBJECTIVES AND DELIVERABLES

32. Progress against the specific objectives in the MRC Delivery Plan will be reported in the form of a Balanced Scorecard and monitored using an agreed cross-Council Output Framework. This is in addition to existing channels of accountability, including the Annual Report to Parliament and the Annual Review. Summary deliverables in relation to Knowledge Transfer are:

— Over SR2004: a significant reprioritisation of MRC spending, with increased funds for clinical and public health research and training; increase external income from collaborative research with users; increase income from exploitation, patenting and licensing; establish new Drug Discovery Group.

— Medium term: increase in the volume of MRC-supported translational research, experimental medicine and research in population health sciences; increased recruitment to MRC trials; closer working with industry; increase translation of basic MRC science into healthcare improvements; transfer of MRC drug discovery programmes for neglected diseases to public-private partnerships or other vehicles to progress treatments to clinic; delivery of high-quality research reagents back to MRC scientists.

— Medium and long term: As tokens of industrial satisfaction, we expect to be able to demonstrate specific industry/MRC partnerships including industry-funded academic consortia, and matched investment; also approval of new drugs by the US Food and Drug Administration and the Medicines and Healthcare products Regulatory Agency, which will benefit industry and health in the UK. At steady state, the Drug Discovery Group will evaluate 12 new targets, translating ultimately into one high-quality lead molecule each year.

— Long term: a major impact on diseases of significant health burden.

Annex 7: Natural Environment Research Council (NERC)

RESEARCH COUNCIL SUPPORT FOR KNOWLEDGE TRANSFER

INTRODUCTION

1. NERC is one of eight Research Councils. It supports research and training in its four wholly owned research centres (British Antarctic Survey, British Geological Survey, Centre for Ecology and Hydrology and Proudman Oceanographic Laboratory), 15 collaborative centres, UK universities and, in the case of one scheme, supports research in companies. Its budget is approximately £350 million per year.

2. NERC recognises knowledge transfer as a complex two-way process and that it should be integrated into the whole research process, from the early stages of project identification and definition to the final stages of completion and dissemination.

3. NERC has a very broad range of users, spread across diverse industry sectors. These include a wide range of major UK and international companies, plus SMEs. In addition to this direct KT business interaction, NERC also has a broad range of other user interaction, such as peer reviewing (over 11% of our Peer Review College are from user organisations) and representation on NERC advisory and decision-making bodies. The industry sectors that NERC contributes to are significant: the environmental technologies and services sector in the UK alone is worth £15billion (source: JEMU 2002).

4. More significantly, NERC science plays a key "public good" role, providing vital science advances for developing environmental policy, regulation and management. Government Departments and Agencies, such as DEFRA and the Environment Agency, are key NERC science users.

NERC KNOWLEDGE TRANSFER STRATEGY

5. NERC's knowledge transfer strategy has four main components:

— Involve users in planning, implementation and review;

— Fund the best knowledge transfer ideas across the NERC remit;

— Integrate knowledge transfer within strategic science programmes;

— Promote entrepreneurship and commercialisation of research.

  6.  Underpinning these strategic objectives is a range of schemes and initiatives, for example our annual call for knowledge transfer (see Box 1). This call will be flexible enough to support the best KT ideas. NERC will continue to work through the RCUK KT Group to coordinate support where it matches the needs of our user community. To provide a baseline for current knowledge transfer and business interaction activity we have developed a suite of metrics, agreed by OST, which will be used to measure progress towards our objectives.

Box 1 Knowledge Transfer Call
  NERC has a unique approach to knowledge transfer across the research councils, in that it runs a specific annual call for knowledge transfer proposals. The first two calls, in 2004 and 2005, have invited applications in three categories: networks with users; collaborative research; and "good ideas". Recent awards include: support for people in key knowledge transfer positions, such as facilitators; special publications and websites; developing collaborations with local authorities; new research collaborations with users that should result in the application of research. In each of our first two calls we have committed over 31.5 million.
  From the end on 2005 NERC will focus collaborative research within its existing research grant schemes and closing dates. We will continue to support an annual call, focusing on providing support for improving the application of scientific research within NERC's remit.

NERC RESEARCH AND COLLABORATIVE CENTRES

7. NERC's Research Centres provide a unique opportunity for all aspects of knowledge transfer: they provide a national capability to provide reliable and independent policy advice to Government. One example is the Centre for Ecology and Hydrology's lead role in the farm scale evaluation of GM crops. The skills and capabilities that exist in our research centres play a vital part in the UK economy: a recent survey estimated that the value added of national output that the British Geological Survey (BGS) contributed to was in the range £34 billion—£61 billion, between 5-8% of the UK value added. Links with key users are extensive: for example, the Proudman Oceanographic Laboratory is a partner with the UK Meteorological Office in the National Centre for Ocean Forecasting (NCOF), whose mission is to establish ocean forecasting as part of UK "infrastructure".

PLANS FOR KNOWLEDGE TRANSFER

8. NERC is implementing plans for knowledge transfer using the agreed RCUK framework:

— collaborative research;

— cooperative training and education;

— people and knowledge flow; and

— commercialisation.

  A cornerstone of the plans is the development of a brokerage unit—see box 2.

Box 2 Brokerage Unit
  NERC's Knowledge Transfer Advisory Group (KTAG), composed of industry representatives, policy-makers and members of NERC's major decision making groups, have endorsed the view that for NERC to increase its rate of knowledge transfer, support for a range of schemes and mechanisms is required to cover the breadth of knowledge transfer; but that more is needed if a sea change in the rate of knowledge transfer is to be achieved.

  Whilst the Research Councils have identified four main categories of knowledge transfer, knowledge flow underpins all activities. Knowledge transfer is a 'contact sport' requiring extensive interpersonal exchanges to achieve successful outcomes. There is increasingly a clear need to provide a stronger link between the academic and user communities. NERC has also funded some specific projects(eg the Cambridge Institute for Aviation and the Environment, funded in the first KT call), however, a NERC KT unit covering the broad NERC remit, acting as an advanced signposting service for both the academic and user communities to contact each other, is a significant missing link in our KT portfolio.
  The establishment of a NERC brokerage unit would be a unique UK-wide service for the environmental sciences. The concept of the unit is being developed by KTAG over the next six months, with the intention that the unit be operational by April 2007.

  It could have the following characteristics:

(i)  Actively use information from successful grant applications on potential users, to develop these links (two-thirds of NERC blues skies grant holders indicate their science is relevant to policy);

(ii)  Act as the home for science to policy and science to industry facilitator posts;

(iii)  Develop good working relationships with the NERC science and user base, to ensure good take up of service.

  The benefit of such a KT unit providing a brokerage service would be:

(i)  Help in the identification of user needs;

(ii)  Help to infolin policy and policymakers and scientists of policymakers needs;

(iii)  Promote awareness and take up of KT delivery rechansms, including those supported by NERC;

(iv)  Help to enhance business involvement in R&D;

(v)  The development of more commercially valuable ideas;

(vi)  Take forward some KT activities following on from directed programmes once the programme officially finishes;

(vii)  Increase leverage of NERC funds by obtaining co-funding from users;

(viii)  Potential, via cogent use of existing IT systems to undertake KT "mining", to identify possible user applications of research and take these forward, in collaboration with researchers and HEls' business development staff.

  A close relationship will be developed with Higher Education Innovation Fund (HE activities. There is a clear opportunity for ITERC to proactively develop improved mechanisms for the take up of NERC science, that can work with, not duplicate, infrastructure beingsupported elsewhere.

(a) Collaborative research

Key target: (i) Increase the number of co-funded collaborative research grants to 6% by 2007-08

9. NERC will increase the amount of research that we fund as collaborative with user involvement. Our new Partnership Research Grants scheme will give NERC increased flexibility to support collaborative research whilst remaining under the umbrella of a State Aids-approved product. We are using the same closing dates and moderating panels for this new initiative as our responsive mode grants. The first closing date is 1 December 2005.

10. Our research centres engage with users via significant amounts of commissioned research (£27.6 million in 2003-04), which reflects the skills and expertise that they have. They have developed stable funding models that require a balance of science budget and commissioned research money. There are no plans to increase the proportion of external research income to alter this balance.

11. There are also considerable opportunities for better knowledge transfer between NERC and the full and corresponding members of the Environmental Research Funders' Forum (ERFF). ERFF are exploring science priorities in the areas identified by their SWOT analysis: this should inform potential areas for collaborative research with government departments and public sector organisations.

12. NERC is running a project to help identify its technology priorities to feed into the national Technology Programme. This should report in the first quarter of 2006.

(b) Cooperative training and education

Key targets: (i) Increase CASE studentships; (ii) Enforce CASE studentship target; (iii). POST secondments

13. NERC is committed to supporting excellent postgraduate training via the MSc, MRes and PhD studentships. The main KT routes that NERC supports are through user-relevant MSc courses and CASE and Industrial CASE (Cooperative Awards in Science and the Environment) PhD studentships.

14. NERC supported 307 CASE and 78 Industrial CASE studentships in 2003-04, spending nearly £4.5 million. Over 120 organisations are collaborating directly in NERC-supported PhD training. We are:

— Expanding our Industrial CASE annual competition to include public sector partners, in recognition of the important role that NERC science plays in public good and policy development. We will increase the number of places supported in the call by up to 50%.

— Enforcing a minimum of 30% of NERC algorithm studentships to be CASE awards. Departments not meeting this target will be penalised.

— Currently undertaking a zero-based review of NERC support for MSc courses for the next five years. There will be considerable user involvement in the process, with user relevance an assessment criterion and user membership on the review panels.

— Continuing to offer four secondments per year to spend three months at the Parliamentary Office of Science and Technology (POST) writing briefing notes for parliamentarians, and investigating similar placements in the Scottish Executive and the Welsh Assembly.

Key targets: (i) Development of a Brokerage Unit; (ii) Increase support for networks, Knowledge Transfer Partnerships and facilitators.

15. NERC undertook a user survey in 2004; one of its main outcomes was the importance of formal and informal links between scientists and users. A number of our major Directed Programmes have started to employ facilitators to increase knowledge transfer. We are currently advertising for a science to policy facilitator, and we will also explore partnership arrangements for more industry-focused facilitators with R/DAs. We have also supporting facilitators within some of our major directed research programmes and in the annual KT call. NERC will increase the number of facilitators to actively link our research with firms and help them identify the potential in a range of NERC research projects and programmes. The user survey stressed the importance of formal and informal means of communication between potential users and the research community (for engagement at all stages of the research process) we intend to increase our communication with potential users through increasing our support for our networks scheme. These approaches will be maximised by working closely both with the range of channels there are in universities, RDAs, trade associations and professional bodies.

  16.  NERC has been a sponsor of the national Knowledge Transfer Partnerships scheme for over 10 years. We intend to increase our support for this scheme, and have been doing so via three main routes: by developing a strong working relationship with Momenta, who manage the scheme; raising awareness of NERC with KTP project offices (mostly based in universities); and increasing awareness of the scheme with academics that work within our remit. Box 3 gives details of our plans.

Box 3 Knowledge Transfer Partnerships
  NERC's current support for this scheme, one of DTI's business support products, is about £100k pa. To help stimulate awareness of the scheme NERC will:

—  Increase its level of support for KTP, conditional on the quality and relevance of proposed projects to NERC's mission;

—  Continue to probote the scheme, via specific KTP awareness-raising seminars, and using RDAs to promote via their environmental technology clusters.

17. To encourage the two-way flow of people between the research community and industry, NERC is a sponsor of the Royal Society Industry Fellowship scheme—for more details see www.royalsoc.ac.uk/funding/.

18. NERC has good working relationships with its sister Research Councils. We will use these strong links to work collaboratively with other councils where a common agenda exists: for example working closely with EPSRC on developing good links with the Environment Industries Unit and with ESRC and others for the Local Authority-Research Council Initiative (LARCI).

(d) Commercialisation

Key targets: (i) 26 new commercialisation ideas; 16 applications to the Innovation Fund; two patents filed; and seven deals agreed from NERC Research Centres in 2005-06; ( ii) Business Plan Competition, Follow-on Fund, commercialisation awareness-raising events.

19. NERC is committed to ensuring that its science is fully exploited. This has two facets: for the science in our four wholly owned research centres, NERC retains the intellectual property; and for the science we support in our collaborative centres and UK universities, the intellectual property is transferred to the host institution, which is in a better position to exploit the science. The Higher Education Innovation Fund (HEIF) and its precursor funding activities support this latter activity.

20. NERC ensures that the science undertaken in its own research centres is exploited where appropriate—NERC employs some 2600 staff, of which 60% are active scientists. NERC employs Exploitation Scouts to identify and develop early-stage commercial opportunities and intends to extend this network by creating additional, part-time roles. In 2005 NERC developed a strategic partnership with ISIS Innovation, one of the UK universities' leading technology transfer organisations, to increase the rate of commercialisation from our four research centres.

21. NERC researchers have access to an Innovation Fund, to help bring commercial opportunities to a point where they can be successfully licensed or attract external finance to establish joint ventures or spinout companies. The Innovation Fund enables researchers to obtain funds for the very earliest stages of a new business opportunity, supporting, for example, obtaining a patent or buying advice on market size. It also provides up to £100k to further develop selected opportunities to bring them to the point where they can be licensed or attract external finance. NERC researchers also have access to the Rainbow Fund, a seed fund set up with CCLRC, DSTL, PPARC and UKAEA. The fund has £4 million to provide financial support to the earliest stages of new commercial opportunities.

22. NERC also encourages commercialisation in its broader academic community. This will be strengthened in the following ways:

— NERC will continue to support the Research Councils' Business Plan Competition, working with the other Research Councils to develop partnerships with RDAs.

— NERC, together with BBSRC, EPSRC and PPARC run the Follow-on Fund, to increase the level and accelerate the rate of commercialisation of research ideas arising from research community by providing funds to enable these ideas to be brought to a stage where commercial opportunities (eg. licensing, seed or equity funds) can be secured. Since it started in 2004 NERC has supported seven projects.

— Support for the BBSRC-led Young Entrepreneurs Scheme (YES).

— Specific events: With the DTI/Defra Environment Industries Unit and EPSRC we are holding a commercialisation conference in November 2005 to raise awareness of the environmental technologies sector, currently a rapidly expanding market.

SCIENCE TO POLICY AND ENVIRONMENTAL MANAGEMENT

23. One of NERC's key areas for knowledge transfer is contributing to policy development and environmental management. In 2005 NERC published a new booklet "Science to Policy: Taking part in the process" http://www.nerc.ac.uk/publications/scienceintopolicy/science-into-policy.pdf to help NERC staff and the academic research community to: a) recognise the relevance of science to policymakers; b) identify opportunities, routes and good practice to influence policymakers; and c) communicate science in an accessible way.

24. NERC will focus its future science to policy activities in the following ways in the next few years:

— Implementing guidelines on engaging users at all stages of science, from the inception of new science ideas through to the completion of directed science programmes, and broadening this out to other areas of NERC activity.

— Increasing support for the secondment scheme for PhD students to work at POST.

— Employing a new science to policy facilitator, to help promote the take up of NERC science.

— Developing ways of synthesising the outputs of blue skies research to make them more accessible to policymakers/other end users.

— Holding more seminars bringing together scientists, policymakers and environmental managers in particular science areas.

— Holding issue-based meetings with government departments and other public sector bodies to explore how NERC improve its supply of scientific evidence to inform policy development.

— Developing best practice in communicating our policy-relevant science to policymakers.

INCREASING OUR INTERACTION WITH BUSINESS

25. NERC has a complex set of interactions with business. Its Research and Collaborative Centres undertake a broad range of interactions that reflect the needs of their own business plans. For two-way interaction between NERC and large firms with an in-house capacity a direct linkage is normally appropriate, whereas for smaller firms the channels may be opened up by; facilitators, the use of intermediaries, university technology transfer companies and business development teams, the RDAs and devolved administrations.

26. NERC ensures that public and private sector users are engaged in the development and running of major directed programmes. Following a recent transfer of funding from DTI, NERC is now responsible for a major space programme, and works directly with space supply and service industries, public sector and commercial customers to deliver its programmes, and a broad range of wider benefits.

WORKING WITH THE REGIONS

27. NERC recognises the increasing importance that the RDAs and Devolved Administrations (DAs) play in knowledge transfer. NERC is in a strong position to increase its interaction with these organisations due to the distributed nature of the NERC Research Centres across the UK. NERC will continue to develop these working relationships through its Research Centres, with support from NERC Swindon Office. RDAs are potentially very important for some industry sectors, particularly those composed of predominately SMEs, as the RDA sector groups may be in a stronger position to access these companies. One example is the environmental technologies and services sector: not only is this is an important business sector for NERC but it is also identified by all the RDAs as a priority for the economic prosperity of their regions.

EVALUATION

28. NERC is committed to ensuring that its investments have an impact on society and the UK economy, and has agreed a range of metrics with OST to measure the exploitation of our investments. In addition, to better understand NERC's impact, we are currently running a study to better measure our economic impact. This is being done by using 10 representative case studies and using methodology that conform to the HM Treasury guidelines on appraisal and evaluation in Government, to ensure that the outcomes of the study are realistic and fully justified.

Annex 8: Particle Physics and Astronomy Research Council (PPARC)

RESEARCH COUNCIL SUPPORT FOR KNOWLEDGE TRANSFER

INTRODUCTION

1. PPARC's primary goal is to deliver a approx. £300 million programme of basic and fundamental science in particle physics, astronomy, particle astrophysics and solar system science. Given the dependence of these areas of science on advanced research facilities, to achieve its science goals PPARC must develop advanced technologies. This technology is the key interface PPARC has with suppliers or developers of technology for its programme as well as with other users who can benefit from using PPARC technology in other contexts (referred to as knowledge transfer or "KT"). The whole programme of industrial engagement and knowledge transfer is therefore built upon maximising this technology dialogue.

2. Early involvement of companies in technology development often places them in an advantageous position when it comes to competing for contracts for the construction of facilities. There is a close relationship between technology development for the PPARC programme, KT, and contract return as illustrated by the diagram:

STRATEGY OVERVIEW

3. PPARC Council approved, in 2004, a strategy which features some key PPARC distinctions—notably a strong emphasis on brokering relationships and recognition that industry needs to be treated as a supplier of technology for the PPARC programme as well as a customer of knowledge transfer. Industry is attracted by the prospects of better contract return and increased KT potential leading to new market opportunities.

4. The strategy can be stated as follows:

— To support UK academic and industrial leadership in the PPARC programme through technology development.

— To spread PPARC technologies to broader market areas (industry and public sector including other academic disciplines) through industry and interdisciplinary collaborative research.

— To support entrepreneurial activity in the PPARC community.

5. There are a number of additional elements to this strategy which include:

— long term science and technology planning;

— brokering (particularly to manage "non-traditional" sectors);

— providing flexible and evolving funding streams focused on desired outcomes;

— supporting enterprise;

— single branding (for all knowledge transfer, innovation, technology and enterprise activities) through the PPARC "KITE Club";

— a partnership mentality (utilising other schemes as appropriate, co-ordinating activities); and

— stimulating UK contract return.

PROGRAMME OVERVIEW

Collaborative research for technology development for the PPARC programme

6. PPARC has implemented a programme of engagement with industry involving:

— Identification of future science priorities by Science Committee.

— Identification of the technologies required to achieve the science goals.

— Promotion of the technology plans and opportunities to industry and other potential technology development partners.

— Creation of a new funding line for technology development across the whole PPARC programme which is open to funding any entity, including industry, which can demonstrate the ability to achieve the necessary technological performance. This may involve collaborative funding or full funding where it is justified by the return to PPARC. Where collaborations involve SMEs, this will count towards the Small Business Research (SBR) target.

— Promoting the formation of consortia to undertake R&D for the programme with direct funding to industry for the work they undertake. Calls may be targeted to specific areas.

Collaborative research for knowledge transfer

7. The PPARC Industrial Programme Support Scheme (PIPSS) has been refocused on knowledge transfer and mobilisation and extended to include a wide range of types of funding support. It has recently received State Aids approval, enabling PPARC to fund industry. This mitigates the risks inherent in commercial organisations comprehending new and novel technologies and helps to ensure that publicly funded technologies are as widely exploited as possible. Increasingly PIPSS will be used as a brand to identify PPARC's contributions to schemes involving other partners as appropriate including Follow-on Funding, Knowledge Transfer Partnerships and Discipline Hopping awards.

Training

8. A study of the career paths of PPARC PhD students (DTZ Pieda Consulting July 2003) reported that 48% of PPARC PhD students end up in the private sector. Skills developed during a PPARC PhD, such as technology, maths and computing, team working, and international cooperation are highly desirable in a range of sectors including the city, major industrial companies and small IT companies. This is independent of whether the PhD had a collaborative component. PPARC is committed to increasing its volume of PhD training with a range of goals including increasing the supply of highly trained staff to other employers. By 2007 it will have increased its student numbers by 50% (from 2003) giving a total stock of 850 p.a, providing an increased number of students to the open market. PPARC also supports up to 10 CASE students per year, with the CASE Plus option of a fourth year in the sponsoring company.

People and knowledge flow

9. PPARC supports an active programme of brokering and networking to increase the awareness of industry and other users and the academic community of each other's strengths, needs and opportunities. This takes place through a programme of visits and workshops under the auspices of the KITE (Knowledge, Innovation, Technology and Enterprise) Club. It is supported by a contractor appointed to bring both technical and commercial experience into the programme (the KITE Club Innovation Advisory Service). These activities create an interactive environment which underpins all the other activities. The contract was retendered in 2005, and the new 3 year contract will double activity by 2007. The brokering programme is enhanced by support from the OST PSRE (Public Sector Research Exploitation) line to enable equivalent work to be undertaken with CERN (the European Laboratory for Particle Physics). PPARC has been successful in bidding, under PSRE3, to extend this activity to its other major international research programmes—ESA (the European Space Agency) and ESO (the European Southern Observatory). PPARC also supports schemes to support movement of people between sectors such as Knowledge Transfer Partnerships (KTP) and MRC Discipline Hoppers.

Commercialisation

10. Most exploitation of PPARC research is through existing companies. A new "PIPSS Fellowship" is being developed for staff wanting to increase their work with industry. However, PPARC also provides support for members of its academic community who wish to commercialise their research through the creation of spin-out companies. PPARC/Royal Society of Edinburgh Enterprise Fellowships are awarded to individual young researchers seeking training in venture creation and time to develop their research into commercial propositions. The Rainbow Seed Fund is available to staff at the UKATC and CERN for the commercialisation of work developed from these organizations in the Public Sector Research Establishment (PSRE) context. PPARC is also a sponsor of the Research Councils Business Plan Competition.

Interactions with business

Supply contracts

11. PPARC, together with UKTI, funds an Industrial Liaison Officer to promote contracts at CERN and ESO to UK companies, and is working closely with BNSC to promote contracts at ESA. A wide range of companies have been made aware of the opportunities for contracts, but UK industry has not been particularly successful in its tendering, and the UK return coefficients are poor. This is in part due to economic conditions, and in part because companies are poorly prepared in the underpinning technology development. PPARC has promoted the development of a strategy for industrial engagement in Research Facilities with other stakeholders, and has recently agreed with DTI and others to extend the Sensors Knowledge Transfer Network with a specific workpackage on Research Facilities. This and the strategy of early industrial engagement in R&D through PRI are addressing this concern but the impact on supply contracts is still some way off.

PPARC interaction with business and public services

12. PPARC Council has members from industry and DTI to ensure input from these perspectives. There are also industrial members on the Education, Training and Careers Committee. Industrialists are involved in the peer review of projects with a collaborative component to assess the industrial component and the overall technical objectives.

Interaction with RCUK

13. PPARC participates in joint programmes with other Councils, such as the Research Councils Business Plan competition, the Rainbow Seed Fund and the Follow-on Fund, where these deliver a generic opportunity to the research community. For some activities, demand is low but the Council, nonetheless, wishes to ensure that its research community has access to services and funding.

Other Interactions

14. PPARC will continue to seek contributions from third parties towards its research programme and KT activities in addition to collaborative grants. This may include joint funding from another government department (eg MoD Joint Grants Scheme or DoH funding), from an RDA associated with a major research centre (eg the Cockcroft Centre), or from an international partner for a UK-led technology initiative (eg MICE). PPARC is also in active discussions with DTI, in the context of the Government's Technology Strategy, concerning industrial engagement in research facilities and advanced instrumentation. In addition to the workpackage on Research Facilities referred to above, a further workpackage on Advanced Instrumentation will also be implemented in the Sensors KTN to help coordinate the instrumentation industry which is widely recognised as being fragmented.

RISKS AND CHALLENGES

15. A fundamental risk with this strategy is that industry is not under PPARC control. Even with the enhanced exposure of our plans and needs to industry, and their engagement in early stage technology development, this may not lead to their participation in project development and supply. There has been a significant example in the past where a major supplier has changed their commercial goals and withdrawn from the science sector despite significant technology development and relationship building. This can be addressed by detailed exposure to all the issues at an early stage, so that as industry progresses with projects they are fully aware of the nature of the requirements. Joint funding with DTI, helping the industry to embed the technology in their core competencies for other markets, will also help to strengthen their potential. There are plans within the proposed new workpackages of the Sensors KTN to gather evidence through an international comparison of Government support for prototyping.

16. There is also a risk of a lack of enthusiasm from academics, who might consider their priority to be delivering the science programme. PPARC has surveyed the community and found that there is a strong will for further engagement with industry and other partners. Groups do need support in interacting with industry and developing partnerships, and this is being addressed by growth in the brokering programme and greater flexibility within PIPSS to meet the needs of the academic and industrial communities.

17. The strategy involves industry having access to funding for new projects from the earliest stage, so its success depends upon there being sufficient funds through the PPARC Grant in Aid and successive Spending Reviews to fund new projects. Although PPARC aims to enhance contract return to the UK, the ultimate decision is outside of PPARC control, being normally subject to international competitive tendering.

18. PPARC does not own IP from R&D conducted in support of its programme, instead it resides with the originators of the research. PPARC therefore has no control over the management of IP and negotiations concerning IP. With much of our research being conducted in large international consortia, there are frequently complex IP ownership and sharing agreement issues. PPARC aims to promote best practice in IP management and encourages consortia to establish appropriate IP agreements.

19. With the rising profile of KT, it is a continuing challenge to better co-ordinate PPARC support for KT with that of other organisations eg RDAs and HEIs.

PERFORMANCE MANAGEMENT

Collaborative R&D

21. By focusing PIPSS solely on KT we are able to report separately on collaborative R&D oriented towards KT and collaborative R&D for the PPARC science programme. The new PRI mechanism which funds industry direct will make funding industry more transparent; sub-contracting through grants to HEIs meant that PPARC did not readily have access to all the information.

22. We will continue to measure the value of collaborative research supported through PIPSS and outcomes through final reports.

Training

23. Since a high proportion of PPARC PhD students enter a career in industry and employers value their skills it is felt inappropriate to consider only collaborative schemes such as CASE and CASE Plus when considering knowledge transfer. Instead we will focus on the wider cohort of PhDs. The introduction of formal Performance Management has led PPARC to commit to regular repeat career path surveys (the next due in 2008) and to include an additional assessment of employer satisfaction.

Commercialisation

24. PPARC will continue to review its involvement and investment in a number of activities—many of which are jointly funded (Research Councils' Business Plan Competition, PPARC/RSE Enterprise Fellowships, PPARC Encouraging Enterprise course, RCs Follow-on Fund). It is necessary to adapt with the changing funding scenes in eg RDAs. PPARC will continue to follow up the outcomes on the percentage leading to spin out and licensing.

People Exchange

25. PPARC will continue to measure its investment in the programme of brokering events and to analyse attendance at these events and evaluation questionnaires. PPARC will apply more rigour in tracking subsequent funding applications. PPARC will also continue to monitor funding through schemes such as KTP, Discipline Hopper—both total investment and outcomes through final reports.

Other industrial interaction

26. PPARC will measure UK contract return through the UK Industrial Liaison Officer for CERN and also ESA and ESO using appropriate PPARC staff contacts. We are doing this already but will want to collect data in a more uniform way where possible using common timeframes, currencies etc.

FUNDING

New OST funding

  27.  PPARC is using the new funding awarded by OST in the Spending Review to enhance specific elements of the programme. The capacity building funds are contributing to the expansion of the brokering programme. The funds for KT and interaction with industry are being applied equally to the KT and technology development funding lines with the aim of increasing the number of KT collaborations with industry and increasing the direct funding to industry for technology development for the PPARC programme.

Activity 2005-06 2006-07 2007-08

PIPSS/other KT 1,549 2,017 2,051

Programme Technology Development* 250 849 987

Commercialisation 61 69 75

Brokering 344 512 522

Funded by:
    Baseline
2,204
2,404
2,592

    OST additional award 1,043 1,043

TOTAL 2,204 3,447 3,635

*to be supplemented with funding from the grants line rising to >£2 million.

1 http://www.parliament.uk/parliamentary-committees/science-and-technology-committee/scitech011205b.cfm Back

2 Guidelines for the Meaning of R&D for Tax Purposes, DTI , HMT and HMR & Customs p1 and p3. Back