Memorandum 66
Submission from QinetiQ
ABOUT QINETIQ
QinetiQ is the UK's second largest defence and
security company, one of Europe's largest employers of scientists
and a leading organisation in technology transfer. Over the past
50 years QinetiQ and its predecessors have built up significant
intellectual capital and expertise in innovation. We exploit our
strengths in technology research, evaluation and management by
delivering solutions into a broad spectrum of defence, security,
transport and related markets. We have delivered such technological
advances as liquid crystal displays, carbon fibre and thermal
imaging into both the civilian and military sectors.
Our 11,400 staff are continuing our commitment
to pushing forward the boundaries of innovation in scientific
and technological knowledge and in the provision of first class
managed services to customers including the Ministry of Defence,
US Department of Defense, National Audit Office and Highways Agency,
as well as private companies.
INTRODUCTION
QinetiQ (and its predecessors) have been involved
in space activities since the 1950s and is a renowned centre of
excellence in spacecraft technology, space systems, remote sensing
and GIS. Coupled with QinetiQ's capabilities in electronics, sensors
and processing, materials and structures, we are well placed to
take advantage of UK National, European and Global space programmes
and the opportunities they present.
For the UK there are many benefits which flow
downstream from the active involvement of our country in the space
arena . Less well appreciated is the importance of being involved
in the upstream activity and the need to maintain an independent
UK capability in key areas of space technology:
— Firstly, without a sustaining level
of technological capability and insight the UK would no longer
be able to meet its need to establish independent capability in
(for example) military satellite communications.
— Secondly, without its own technological
capability it will be unable to effectively contribute to, influence
and extract value from international space programmes.
— Thirdly downstream activity (such
as commercial satellite operation) and associated skills will
over time relocate to where the upstream activity is.
USING CAPABILITY
TO ACCESS
THE MARKET
Without the expertise to understand both the
market and associated technology drivers the UK would cease to
be an intelligent customer, would be unlikely to secure leading
edge technology or value for money and that the UK was limited
to using "off the shelf" technology packages purely
on the suppliers' terms. If the UK was to surrender its ability
to develop space related technology there would be limited incentives
for other nations to sell cutting edge technology to us.
Falling behind in our capability to develop
the upstream side of space technology will not only limit our
ability to access the best of what the market can offer but will
also affect the value and innovation in the downstream sector.
BENEFITS TO
THE UK ECONOMY
Without our own upstream industries being involved
in the development of current and future programmes the downstream
sector would be behind the development and innovation of its international
competitors and less able to compete.
Failing to participate actively in space programmes
would in the long term create a danger that UK economy would lose
access to certain skills if the work was not available to keep
them actively engaged in the up or downstream sectors.
With many wider European issues such as security,
border control and transport, looking towards satellite and remote
based systems the need to be able to influence the shape and form
of the initial systems has never been more important. Equally
as these programmes and policies develop the UK may become reliant
on packages and infrastructure purchased from the international
market to implement policy in the UK.
Space is now an intrinsic element in global
civil and military communications, navigation, security and environmental
monitoring, forming a key element in the business portfolios of
the key defence and aerospace industry. There is also a need for
research and development funds to be made available for solutions
to novel problems if the UK is to remain at the technological
cutting edge.
The current approach to investment in the space
programme has some merits as does the current organisation of
the British National Space Centre. The approach of some of its
partners, however, is risk averse and there is a tendency to wait
until there is there is a low risk commercial, product to purchase
rather than to invest at an early stage and take advantage of
the opportunity to exploit and pull through the technology. The
UK needs to recognise that new, innovative technology needs to
be incubated so that the full range of possibilities may be realised
and the return on investment realised.
The influence of BNSC appears, on occasion,
to be relatively limited in the European Space Agency (ESA). While
the UK remains a key funder, the policy of not participating in
areas such as the manned programme and launchers, while clearly
economically correct, means that the UK are not active in those
high profile activities which have commanded so much attention
in ESA and so the UK often fails to exert a level of "political"
influence commensurate with the UK contribution. The importance
of the Galileo programme and growing ESA interest in mould breaking
innovations such as small satellite mission solutions offer an
opportunity for higher profile and repositioning. A visible commitment
to maintain UK funding levels to ESA into the medium term would
be underpin this.
UK geographic under-return in certain applications
areas remains an issue. The previous successes of the UK domestic
ATS and the MOSAIC programmes, the latter of which funded TopSat
and demonstrated the utility of small satellites to undertaken
significant tasks cost effectively, are recognised by ESA and
UK industry. A new, focused, UK national programme aimed at pre-positioning
UK technology for Space, as our European partners do, would be
a key element of addressing this geographic under-returns issue.
The Defence Industrial Strategy recognises the
role that innovative satellite systems, the creation of which
has benefited from past national space technology investments,
could play in future UK defence capabilities.
The role of space in engaging the population
in science and engineering should not be overlooked. The future
health of the UK economy will rest heavily on the quality of intellectual
property developed and services available. The quality and number
of students pursuing science and engineering subjects to A-Level,
degree and post-graduate levels is a source of concern not just
to the high end businesses but to employers as a whole. The work
of research and development teams in defence, aerospace and pharmaceuticals
has enabled the UK to be a world leader in those fields.
These remain competitive markets and the UK's
position should not be taken for granted. The growth of economies
in South East Asia have been much reported but increasingly many
of our European partners are raising the importance attached to
developing and maintaining space capability within their national
industrial and technology strategies. The UK has led the way in
terms of industrial rationalisation and the focus on a knowledge
driven economy, we must though now continue to look to use spending
to drive further technological innovation if we are to maintain
our current position.
CHANGING EMPHASIS
IN EUROPEAN
SPENDING
As the European space programme develops increasing
amounts of resources will be used as operational funds by the
European Commission. These will be largely focused on the centres
of expertise within the Union at the time the operational locations
need to be established. In turn these locations are likely to
relate to clusters centred around the current projects of the
European Space Agency. Commitment to the current round of projects
is important if UK is to maintain influence on the direction of
future operations and expertise within the UK.
In the long term this pattern of growth and
investment would reinforce the chosen locations as the centres
to draw in new expertise and new investment making it harder for
a new entrant to come into the market place. Being an active participant
in the initial stages of the move in funding towards operational
services could only be beneficial for the national economy and
our ability to maintain capabilities in the UK.
SUMMARY
The UK's future prosperity will depend on innovative
upper end technological research and engineering development to
deliver capabilities across the economy. Our nation needs champions
and leadership to stimulate and drive such innovation. The private
sector needs to be stimulated both through competition for long
term research programmes. Long term certainty will in turn encourage
the private sector to commit resources to develop the intellectual
property to drive the economy over the long-term.
If young people are to be drawn into science
and engineering subjects, if talented graduates are to choose
careers in innovation over law or accountancy we must continue
to ensure that there are high end goals and aspirations for them
to strive to attain. The quest for space is a key area in providing
challenges for some of our nation's finest minds and those the
future generations. Space remains one of the key areas for drawing
highly talented people into the sectors which drive our knowledge
based economy. The ability to draw in and maintain the brightest
and the best the basis of intellectual property development and
innovation in science and engineering is a key part of enhancing
the competitive standing of the UK.
Procurement across Government needs to take
every opportunity to develop innovative technology solutions rather
than take off the shelf solutions. For some this will mean needing
to be less risk averse with their investment in and incubation
of leading edge technologies. By doing this they will not only
develop better expertise in procurement but also stimulate the
knowledge economy of the UK. If the UK wishes to remain a leading
innovator rather than simply a consumer of technology then the
use of Government's £150 billion annual spending on procurement
of goods and services it will be vital to lead investment across
the economy[2].
Government leadership in innovation in the space
programme is one mechanism to help stimulate not only investment
in the downstream sectors but also to draw in high calibre people
to the knowledge base of the UK economy.
October 2006
2 Procuring the Future, recommendations from the National
Sustainable Procurement Task Force. Defra 2006. Back
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