Select Committee on Science and Technology Written Evidence

Annex 2



  A2.1  On July 4, 2000, the Parliamentary Trade and Industry Committee published its Tenth Report [A1]. Among other comments the Committee noted that the BNSC spends approximately half of its budget on Earth observation activities, but that these are far from being commercial. It concluded:

    "UK space policy appears to have failed to date in this central objective. Despite more than a decade trying to stimulate commercial markets for Earth observation data, provided at public expense . . ."

  The Committee also criticised the fact that the decision to concentrate hundreds of millions of pounds of investment on this field was based on no more than

    ". . . an expression of general but unsubstantiated hope that commercial markets will be generated" [A1].

  A2.2  The Select Committee also investigated the fact that the BNSC has made no investment in assessing the commercial potential of passenger space travel, despite extensive evidence that it is the most commercially promising use of space. The Committee elicited further that the BNSC had argued against Bristol Spaceplanes Ltd receiving any support from DTI for its work in this field for nearly a decade, but that this decision was made without the BNSC having performed any analysis of the commercial promise of passenger space travel, or of Bristol Spaceplanes' plans. On the contrary, Bristol Spaceplanes' work had been highly praised—including heading the list of references in Nasa's very positive 1998 report on space tourism [A2]. The Committee also interviewed Lord Sainsbury, the Minister responsible for space, and learned that HMG did not have a policy not to invest in launch vehicles, as the BNSC had stated incorrectly in arguing repeatedly against funding for Bristol Spaceplanes.

  A2.3  On the basis of these and other findings the Trade and Industry Committee recommended that

    ". . . a review is undertaken of the UK's participation in launcher development programmes . . . Since no partner in BNSC is likely to be fighting for UK involvement in reusable launch vehicles (RLVs) we also recommend that this evaluation be undertaken by a body independent of BNSC" [A1].

  In addition, the Committee specifically referred to the potential of space tourism, which was discussed positively in 5 separate Memoranda to the Committee [A.3, A.4, A.5, A.6, A.7], and cited Space Future Consulting, as follows:

    "Space Future Consulting are of the opinion that the government should not participate in any launch vehicle work that is not specifically aimed at developing a passenger-carrying vehicle, stating that the UK's lack of involvement in ELVs leaves the UK uniquely placed to exploit space tourism" [A1].


  A2.4  On October 27, the British government published its reply to the Select Committee's report [A8]. Written by BNSC staff, this showed its strong resistance to the subject of passenger space travel, which it did not mention at all. This was despite the fact that this was the most economically important issue raised by the Select Committee. Instead of an inquiry independent of the BNSC recommended by the Select Committee, the BNSC commissioned a report to

    ". . . reassess the combined effects of development costs and timescales, revenue streams, market entry conditions and windows of financial return in the current and medium term launcher market."

  The Launcher Sub-committee of the UK Industrial Space Committee (UKISC) was paid 30,000 pounds to perform this study, which the BNSC directed not to consider passenger travel.

  A2.5  Despite this, the BNSC claimed that the conclusion of this study was that:

    ". . . the evidence shows that a European reusable launcher. . . would require full development funding and overall 2/3 of through life costs from the public sector. The case for investment in this area at this time is therefore not strategically sound or commercially attractive" [A9].

  The truth is that this statement applies only to cargo launch vehicles, since no analysis was performed of passenger carrying. However, it gives the impression that it applies to all launch vehicles, and is therefore untrue by omission—particularly in the context in which the Trade and Industry Committee had recommended a study. It was clearly not commissioned by the BNSC in order to learn whether the Select Committee's recommendation of passenger space travel was sound.


  A2.6  Following the Trade and Industry Committee's 2000 Report another report on the British space industry was commissioned by the DTI from a consulting company, with advice from several senior figures from government space agencies, and published in July 2001 [A10]. Readers of this report could be forgiven for assuming it to be definitive, being a 400-page review of the previous 25 years of British government space funding, amounting to several billion pounds. Unfortunately the economic analysis in the report is very limited, and even important economic facts are not stated clearly. Above all, it does not discuss the fact that the return on investment in space activities to date has been extremely poor, in Britain as elsewhere. For an investment of several billion pounds there should be a commercial space industry with annual turnover of billions of pounds. However, apart from government spending, commercial space activity amounts to barely 10% of that. If the report had stated this clearly it would have been obliged to recommend a more energetic search for more commercially valuable uses of space technology.

  A2.7  Instead of this, the report proposed:

    "A strategic review of the commercial opportunities for civil space activity should examine the case for a more balanced portfolio of complementary space investments within the UK budget to avoid reliance on a single technological focus. This should be used to inform the next BNSC review of UK space policy."

  The report recommended:

    ". . . an exhaustive exercise leading to a comprehensive and actionable Implementation Plan, working systematically from the high level goals through objectives and on to a budgeted-action plan spanning the next five years. It ought to be accompanied by a forward look in terms of strategies and commitments that has a 10-year and 25-year scenario. The BNSC should look to international practice—such as the NASA Strategic Enterprise Plans and roadmaps—for a lead."

  A2.8  From the economic point of view, recommending that the BNSC should mimic NASA is a very bad idea, because the economic return on NASA's expenditure has been extremely low—arguably disastrous for the US economy. Since the end of the "cold war" alone NASA has spent more than $200 billion of taxpayers' money, while the US space industry has shrunk substantially. If invested commercially, there should be a $200 billion/year space industry—but there is only a small fraction of this. In addition, NASA has imposed large social costs by continuing to delay the development of passenger space travel at a time when the lack of new industries in the USA is so severe that it has a record trade deficit of $2 billion/day, and the worst unemployment situation for decades (with 10 million fewer new jobs than in previous recoveries).

  A2.9  Hence, for all the effort that has gone into the report, it is deeply flawed—because it nowhere even refers to the possibility of passenger space travel—the activity that is now widely recognised as being the most commercially promising use of space, as described above. By limiting itself to space agencies' vocabulary of "space transportation" (ie satellite launch) and "manned space flight" (ie government staff riding on vehicles like Soyuz and the space shuttle), the report effectively prevents readers from even thinking about the possibility of commercial passenger space travel. The assumption that there is no more economically valuable activity to be done in space than what space agencies are already doing, is incorrect: there is ever-growing evidence that passenger space travel can grow into a popular new consumer service industry of great economic value.


  A2.10  In August 2001 a further review of the BNSC was announced as a response to the Trade and Industry Committee's 2000 Report. The terms of reference stated that

    ". . . the study will review the evidence provided to the Trade and Industry Select Committee investigation into space policy. . ."

  The review was therefore clearly required to consider the issue of passenger space travel, which was discussed in at least five submissions to the Select Committee [A3-A7], as well as in spoken testimony.

  A2.11  Dr Pippa Goldschmidt, an astrophysicist at Imperial College, was invited to write the report. The author wrote to her on 30 November to ask whether the subject of passenger space travel, which was the most economically important issue raised by the Select Committee's Report, would be considered in her review, and if not, then when and under what auspices this important matter would be discussed. Dr Goldschmidt replied on 5 December 2001:

    "Thank you for your e-mail . . . I will reply to it more fully in the near future" [A11].

  However, she never did reply, despite subsequent letters on the subject dated 9 January, 13 February and 27 June 2002.

  A2.12  Dr Goldschmidt's report made no reference at all to the subject of passenger travel, nor to the related evidence on the subject provided to the Trade and Industry Select Committee [A3-A7]. However, her report included the statement:

    "It is beyond the terms of this review to consider the appropriateness of funding or not funding particular activities, or the level of such funding" [A12].

  This contradicts the statement that the review would consider the evidence presented to that Committee, and continues the pattern of space policy makers' refusing either to discuss the subject of passenger travel, or to justify their refusal to discuss it.

  A2.13  From her statement of 5 December 2001 it seems reasonable to assume that Dr Goldschmidt did initially intend to answer the author's questions—as she could be expected to: scientists accept the over-riding importance of open discussion in order to discover the truth. For example, such a refusal to answer a key question about her work as an astrophysicist would be astonishing, and could even be career-threatening. However, when she subsequently decided, or was told, that her report was not to tackle the most economically important issue, it seems that she did not wish to discuss the reason for this; she also no longer wished to answer the question where this matter would be considered; and she was also unwilling to state this publicly.

  A2.14  From the point of view of policy science, (that is, the systematic attempt by social scientists to understand the process of policy-making and to ensure that it works in the interests of the public), Dr Goldschmidt's refusal to answer these questions after having said that she would is of extreme interest. As discussed above, investing in the development of passenger space travel is the most economically valuable objective for space policy. Consequently the reason why Dr Goldschmidt's report did not consider this issue, to which the Select Committee had drawn particular attention, and her continuing silence concerning this reason, all remain of exceptional interest for understanding the fundamental cause of this serious failure of British government policy-making.


  A2.15  In 2005, a report by the Royal Astronomical Society (RAS) recommended that the British government should spend 150 million pounds per year for 20-25 years (ie some 3-4 billion pounds in total) in order to participate in "manned space flight" activities, notably for Moon and Mars exploration [A13]. However, if such huge sums were spent on activities using expendable launch vehicles, as currently planned by Nasa, it would have little or no economic benefit for taxpayers, since it would do nothing to reduce the cost of space activities in future. In addition the costs of the proposed exploration would be about 100 times higher than achievable using reusable passenger vehicles.

  A2.16  It would be sadly ironic if, after having avoided wasting resources on unprofitable activities using expendable launch vehicles for 20 years, British policy makers now joined the wasteful "mainstream" at exactly the time when it is so clearly a costly failure. By contrast, if the British government would invest even a moderate fraction of the 3-4 billion pounds requested by the RAS to develop reusable passenger space vehicles, the result would be of enormous economic value; it would have wide popular support, particularly among the young; and it could propel Britain's aerospace industry into a world-leading position.

  A2.17  It may well be that the space scientists responsible for the RAS report are not aware of the feasibility of low-cost space travel, which has never been officially discussed except by the Trade and Industry Select Committee. It is notable that the negative views on space tourism of another space scientist, Dr Andre Balogh from Imperial College, have been given considerable press coverage. However, none of these space scientists have studied the feasibility of low-cost launch systems, nor published research on the subject. Moreover, space scientists are not disinterested parties; their work is dependent on their having good relations with space agencies, which have long been hostile to passenger space travel. The unsatisfactoriness of relying on the opinions of such people on this subject, however eminent they are in their own fields, can be seen from the fact that the government would surely not rely on, and the press would surely not give coverage to the views of an economist on a matter of astrophysics, such as quasar evolution.


  A2.18  If the BNSC had implemented its stated objective to

    ". . . help industry maximise profitable space based business opportunities" [A8]

  it would have both studied the feasibility of passenger travel and invested in realising it. That it has never done so, and has also repeatedly advised the Department of Trade and Industry not to for more than a decade, is a costly error. In addition, for the past six years this has also been directly contrary to the advice of the Trade and Industry Select Committee in July 2000; yet the BNSC has nowhere publicly justified its behaviour.

  A2.19  Interestingly, the BNSC's objectives have recently been rewritten to be less economically ambitious, and say no more than to "stimulate increased productivity through promoting the use of space in commerce" and "develop innovative space technologies and systems to deliver sustainable improvement in quality of life". The BNSC has also recently taken to including sales of satellite television decoders and broadcasting as "upstream revenues" of the space industry. However, the fact that British consumers like to buy imported electronic devices for viewing largely imported television programming is hardly evidence of successful space development.

  A2.20  It is also of interest that the BNSC web-site includes a list of "Reviews & reports on UK civil space" but does not mention the Trade & Industry Select Committee's 2000 report. The BNSC has thereby hidden the fact that the only independent review of space policy, carried out by a Parliamentary Select Committee, found the case for investigation of space travel convincing, and urged the BNSC to do so. The reports which it has itself commissioned do not mention the subject.


  A2.21  In September 2006 it was reported that an Esa staff-member stated:

    "I think the conclusions are shared by all the space community that space tourism has a great potential to become a very successful business and a major driver for space technology development. If this materialises, the future of human space flight might even be exclusively commercial, potentially having a great impact on the scope of the activities carried out by space agencies" [A14].


    "The flight of SpaceShipOne resolved all doubts regarding whether small private companies could perform human suborbital space flight safely and inexpensively. It also showed that there is a worldwide interest in space tourism. It certainly opened the door to human suborbital space flight to become a commercial business soon" [A14].

  The same report also stated that the European Commission is paying the two large non-British aerospace companies EADS and Dassault to study

    ". . . potential road-blocks to European space tourism operations" [A14].

  Although these statements do not represent a change in policy as yet, they are strong additional evidence of the error of the BNSC's stance in preventing research on passenger space travel. They are also strongly supportive of the unique work of Bristol Spaceplanes and Space Future Consulting over the past 20 years.


  A2.22 In summary, for more than six years the British government's space policy makers have continued as though the Trade and Industry Select Committee had not criticised its "failed" commercialisation efforts and recommended studying passenger space travel. The BNSC's decision to spend a further 400 million pounds since 2000 on Earth surveillance satellite systems, with no commensurate improvement in commercial return, while continuing to ignore passenger travel is clearly not a sincere effort at commercialisation, and constitutes a continuing policy failure.

  A2.23 The question why the BNSC is so strongly resistant to passenger travel remains unanswered. The only substantive comment which the author has elicited was the following:

    "We believe that space tourism is not likely to be a mass market for the foreseeable future" [A9].

  However, as an opinion, this statement is not based on any published research, and it is contradicted by Nasa's published market estimate [A15] (as discussed in Paragraph 3 of the main Submission). Moreover, it is contrary to the publicly stated policy to

    ". . . help industry maximise profitable space based business opportunities" [A8].

  It is also not consistent with spending some 1,000 million pounds on Earth surveillance activities over 20 years, which have no prospect of becoming a mass market—while spending nothing at all to even investigate passenger travel, of which the promise has been recognised by Nasa, the AIAA, the FAA, NASDA, ESA, the EU and other organisations. While the non-profit-earning use of Earth surveillance data can be valuable for environmental research and for military purposes, these activities are not a substitute for earning a commercial return from investment in space.

  A2.24  The process whereby changes in space spending are decided has been described as follows:

    "Spending proposals in the DTI have to be supported on the basis of ROAME statements . . . These are considered by internal programme committees before being submitted to the person with the authority to commit the level of expenditure involved. No ROAME statement has been prepared on passenger space travel as there have not been expenditure proposals. This is because we have not at any stage been convinced that there is sufficient argument to commit public funds to the study of this area. . .ministers have encouraged BNSC to focus priorities on...developing markets which have short-term promise of commercial returns" [A16].

  While this arrangement may sound reasonable, there are a number of serious problems with it. First, it has not been applied consistently: while being used to allow further expenditure of 400 million pounds since 2000 on Earth surveillance systems which show no promise of commercial returns, as the Trade and Industry Select Committee specifically criticised, nothing at all has been spent on even a feasibility study of passenger travel—despite the rapid growth in recognition of its potential world-wide.

  A2.25 Second, such a purely internal decision-making process, with no objective measures of performance, no need to defend positions publicly, and no costs for failure, is a recipe for stagnation—which has indeed been the result. Third, the process described is a particularly inappropriate way of making decisions about innovative projects, which are well known to involve uncertainty, and to be inherently "disruptive", leading to "creative destruction" of obsolete activities. It is inevitable that such an administrative structure will be poor at recognising valuable new possibilities and committing resources to aid their growth even in the early stages with relatively high uncertainty. This is especially likely for a major innovation which poses a threat to existing activities.

  A2.26 Moreover, the record is clear: the only report on British space policy which was clearly independent of the BNSC and space policy-makers is the only one with substantial criticism and a proposal for major change. This proposal has been entirely ignored, and the report buried under a flurry of commissioned reports which all ignore the main issue. These reports are listed on the BNSC's web-site, while the critical report is not, so unsuspecting readers have no means of discovering that a fundamental criticism of British space policy remains unanswered after six years, and that world-leading British research has been starved for 15 years.

  A2.27 HMG's failure to provide any support for passenger space travel research over this time has been a serious failure of policy. It appears to have been partly due to the excessive influence of a long-standing monopoly without adequate oversight. The refusal of British space policy makers to consider the subject for 15 years has already lost a great deal of potential competitive advantage, representing a major loss to British taxpayers. Rapid actions to make up for lost time, under the right auspices, would have great economic value.

A1.House of Commons, 2000, Trade and Industry—Tenth Report,
A2.D O'Neil, I Bekey, J C Mankins, T F Rogers, E W Stallmer & O'Neil, 1998, "General Public Space Travel and Tourism Volume 1—Executive Summary", NASA/STA, NP-1998-03-11-MSFC; also at
A3.D Ashford, 2000, Memorandum submitted by Bristol Spaceplanes Ltd, Minutes of Evidence, cmtrdind/335/0041114.htm
A4.T Rogers et al, 2000, Memorandum submitted by the US Space Transportation Association, Appendix17, cmtrdind/335/335ap21.htm
A5.M Hempsell, 2000, Memorandum submitted by Mr Mark Hempsell, Minutes of Evidence, cmtrdind/335/0041113.htm
A6.J Brodie-Good, 2000, Memorandum submitted by Wildwings Worldwide Travel, Appendix 8, cmtrdind/335/335ap09.htm
A7.P Collins et al, 2000, Memorandum Submitted by Space Future Consulting, Appendix 12, cmtrdind/335/335ap13.htm
A8.Anon, 2000, Government Reply to Trade and Industry Committee Tenth Report, Appendix to Trade and Industry Committee Twelfth Special Report, 908/90804.htm
A9.A Cooper, BNSC, 6 February 2002, Personal Communication.
A10.Technopolis Group, 2001, "Evaluation of Funding for UK Civil Space Activity", DTI Assessment Paper No 42, (URN 01/1032), index.cfm?nid=11912
A11.P Goldschmidt, 5 December 2001, Personal Communication.
A12.P Goldschmidt, 2001, "BNSC Review: Report of Findings by Dr Pippa Goldschmidt",
A13.F Close, J Dudeney & K Pounds, "The Scientific Case for Human Space Flight", Royal Astronomical Society Commission, RAS PN05/45, 2005.
A14.L David, 2006, "Esa to Sponsor Space Tourism Work", September 19,
A15.Nasa-MSFC, 2003, "NASA ASCENT Study Final Report", Marshall Space Flight Center.
A16.A Cooper, BNSC, 5 August 2002, Personal Communication.

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