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The inquiry uncovered profound problems within the STFC—weaknesses in its senior management structure and leadership and in its peer review and consultation processes. To be fair to the STFC, however, it has taken some positive steps following our critique. In co-ordination with the Department for Innovation, Universities and Skills, it has commissioned an independent organisational review following our criticism of its senior management. We look forward to seeing the conclusions of the review and what positive changes will follow. The STFC also consulted extensively within its community prior to last week’s publication of its “roots and branches” reprioritisation of the entire council programme.

Broadly speaking, the views of the peer review panels and the funding decisions taken by the STFC are now closely aligned, and we must question why that was not the case in the first place, because it would have saved much anxiety within the community.

David Howarth (Cambridge) (LD): What has happened has been deeply damaging to the physics and astronomy community. Does my hon. Friend accept that some of the damage is long term? The community itself has now lost what confidence it had in the senior management of the STFC and it might only be regained by a radical reconstruction of its leadership.

Mr. Willis: I hear what my hon. Friend says. It is the job of a Select Committee to examine carefully the evidence that is put before it, to make clear recommendations, and to expect both the Government and any organisation that is criticised to put matters to rights. A systematic review is taking place, agreed between the DIUS and the STFC’s leadership and its chief executive. I am content to wait until that review has been completed and the Government have responded, so we can see whether the community—which has without doubt been damaged—can have its confidence restored. It is easy to call for people to resign: it is far more difficult to resolve the problems within an organisation. I hope that my hon. Friend will be content with that response.

In addition to the review, the STFC has appointed a communications director from outside the organisation, which our report recommended. There were a number of areas of particular concern that were brought to our attention and which we highlighted in our report. The first concerned the future of the Daresbury laboratory. It appeared to us—and it was confirmed when we visited Daresbury—that the campus was being prepared as a technology business park rather than a world class science centre. Other hon. Members will wish to add their impressions of the visit, but we are encouraged that the STFC has announced that key research activities, such as ALICE— accelerators and lasers in combined experiments—and EMMA, or the electron model with many applications, will continue at Daresbury. Although the STFC has always said publicly that it is committed to Daresbury, the decisions to retain ALICE and EMMA, and the acknowledgement that it will take some time to rebuild the science capacity there, are welcome both in terms of Daresbury’s future and as a vindication of the serious concerns that we raised in our report.

The astronomy technology centre in Edinburgh was a second area of serious concern for the Committee. Here the future is less clear. The STFC wanted to close the
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centre, but has now opened negotiations with the university of Edinburgh to take it on. I hope that the Minister will be able to reassure the House that those negotiations have his blessing and are likely to come to fruition. I also hope that the Scottish Parliament is being encouraged to play a key part in ensuring that we retain that world class facility.

I am pleased that our report has also led to other movement. For example, e-MERLIN—which will increase the sensitivity of the existing MERLIN radio telescopes by a factor of 30—is central to the future of an operational Jodrell Bank and, according to one of STFC’s peer review panels,

One wonders therefore why it was under threat of having its grant removed. Fortunately, it will now receive some money from the STFC, but the STFC is looking for other partners to share the cost. The programmatic review announced last week resolved to find a way to bring other partners on board to ensure the medium-term future of the programme, but Jodrell Bank is interested in its long-term future, and I hope that the Minister will be able to make some comment about that.

A fourth area of concern was solar-terrestrial physics, which appeared on the brink of extinction following the first round of STFC announcements. The only ground-based STP to receive continued support in the near term is the European Incoherent Scatter Scientific Association programme—EISCAT—which is an international research organisation operating three incoherent scatter radar systems in northern Scandinavia. It will receive that support only because the UK is legally bound to a multi-year contract.

The STFC has declared that it will cease payments to EISCAT in 2011, but EISCAT membership is on a five-year rolling contract. It is now 2008, and it appears that we are tied in until at least 2013, not 2011. The STFC has decided that it wants to leave, but it has not even discussed this with the director of EISCAT or given any formal notice of withdrawal. It is that lack of communication and shoddy handling of key facts that has landed the STFC in real trouble over its future plans. Perhaps the Minister will clarify the position on EISCAT this evening.

It is that same lack of communication that appears to be at the heart of the STFC’s budget problems. Its inability to communicate properly with its own community will, I hope, be put right in the future. In redressing the balance, the STFC clearly has some difficult times ahead, but the fact that it has listened—albeit belatedly—not only to the Committee, but to its community, is a positive step. We welcome the STFC’s willingness to address our criticisms constructively. The fact that it will spend almost £2 billion over the next three years on what is a hugely exciting programme is something that we should now support, instead of raking over old coals. Of course, there have been some losers in the funding round, but there have also been some big winners.

Let me now turn to the ability of the Government and Minister to engage with what I always hope will be positive criticism from the Select Committee. The Minister will accept that many members of the Committee are deeply committed to science and do not make criticisms
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purely for the sake of it. The Government rejected the bulk of our conclusions and recommendations, and we acknowledge that they have every right to do so, but they do not have the right to traduce what the Committee said or to produce a response that was impolite, inaccurate and, at times, incomprehensible. That is unacceptable and should be challenged.

The Government were hasty in rejecting our recommendations regarding the transparency of the allocations process, and in particular our suggestion that documents prepared for bilateral negotiations between the Government and the research councils should be published as a matter of course, which goes to the heart of the issue of transparency and communications with the community. The Government rejected the recommendations on two grounds. First, they claimed that some information is commercially confidential—I can understand that—and, secondly, that transparency would put at risk “candid discussion and robust appraisal” during the allocation process.

The Minister must recognise that those are not sensible rebuttals. Commercial sensitivity did not prevent the release of most of the information under the Freedom of Information Act 2000 and, if that is an issue, DIUS should be able to release the documents as a matter of course, with steps taken to remove commercially confidential information prior to release. The second concern, that transparency would put candid discussion at risk, simply does not hold. We have not asked to see transcripts of the negotiations, because that would be preposterous, but we have asked for the documents relating to the negotiations so that we can see on what basis the decisions are being made.

Keeping the negotiations confidential opens the Government up to accusations that they have inappropriately influenced the decisions that research councils take. That is the most damaging accusation for the relationship between the Government, the research councils and the research community. Accusations that the Government have broken the Haldane principle are already coming from organisations such as CaSE, the Campaign for Science and Engineering, and when such strong organisations make complaints, people sit up and listen, and so should the Government. They cannot simply dismiss those accusations. Will the Minister consider our recommendation that the documents that are prepared by research councils for use in bilaterals with DIUS are published as a matter of course?

Dr. Evan Harris (Oxford, West and Abingdon) (LD): Does my hon. Friend agree that the Government’s argument that this decision is part of the comprehensive spending review negotiations is different in this case? It is not like allocations to the Higher Education Funding Council, for example, where the Government rightly and transparently say that they want to direct Government priorities and to see that what the council proposes to spend in the settlement is what the Government want it to do. In this case, the Government claim, rightly or wrongly—rightly, in my view—that they do not have any influence on particular scientific programmes. Therefore that process of negotiation is especially different in Haldane.

Mr. Willis: I am grateful to my hon. Friend, and I am sure that he will make those points again. That was the very point that I was trying to make—obviously, not as well as I should have.

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We welcome the fact that the CSR period will be characterised by an increased emphasis on translational research into health and wealth benefits. Three new bodies have been set up recently for that purpose: the Office for Strategic Co-ordination of Health Research, or OSCHR; the Energy Technologies Institute; and the Technology Strategy Board. It is clear from our report and the Government’s response that those new bodies—welcome as they are—are partially supported by reallocated money that previously supported basic science, which I think was the point that the hon. Member for Castle Point (Bob Spink) alluded to earlier.

The Government defend the movement of funds in paragraph 43 of their response by saying:

They go on to say:

Those statements run contrary to previous assurances that the Government have given to us that basic science will never be cut in favour of translation. Can the Minister reassure us that the increased emphasis on translational science will not have a detrimental effect on basic science—the kind of science that is not on the fast-track to translation, but will instead enhance humanity’s knowledge base in the long-term?

The key issue of the Government’s approach to the Haldane principle emerged during our discussions on regional policy. I am sure my colleagues will speak later, so I shall be brief. In short, the Government appear hopelessly confused on regional policy. They have repeatedly stated that they want

That desire has led the Government to have a specific vision for the STFC to fund science at Daresbury. Whether or not that is a breach of the Haldane principle, it is a clear breach of Government policy, which is:

That is a direct quotation from the “Science and innovation investment framework, 2004-2014”.

Surely, if the Government follow their own guidelines and the Haldane principle, they should not be putting pressure on research councils to invest money in any specific location, as they have done by repeatedly voicing a desire to see world-class science facilities at Daresbury and by outlining their specific vision for the Daresbury campus to be a partnership between the STFC and others. That is for the research councils to decide on the basis of the science, but the Government are clearly and rightly determined that Daresbury should have a bright future.

I understand that there is a problem for the Minister: either the Government have a regional science policy or they are reaching for one. Either way, they should make their position clear. Will the Minister reconsider our recommendation to open a debate on regional science policy by producing a White Paper on the subject? He cannot still simply allow the confusion to go on between centrally driven national policy, in terms of the Haldane principle and excellence, and regional policies.

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Finally, at the heart of the problems over the STFC’s budget is the financial legacy that the STFC was left with following the merger of the Particle Physics and Astronomy Research Council, or PPARC, and the Council for the Central Laboratory of the Research Councils, or CCLRC. The Government have repeatedly denied that the origins of the STFC’s budget shortfall have anything to do with an inherited deficit from CCLRC by pointing out that the STFC was formed without a budget deficit. That is absolutely true, and the Committee has no wish to reopen that argument. However, the Government have consistently missed the point. As Professor Keith Mason, the former chief executive of PPARC and current chief executive of the STFC, so correctly put it:

That was the point.

Let us consider the facts. CCLRC would have had a budget deficit of approximately £80 million, in today’s money, had it continued as a stand-alone council, because its baseline allocation was not sufficient to meet the running costs associated with Diamond and the ISIS second target station coming online. That is shown in the National Audit Office report, “Big Science”, from January 2007—it is not something that we made up. The STFC was given approximately the combined budget of CCLRC and PPARC and the STFC’s budgetary shortfall is almost exactly the same size as the amount that CCLRC would have been short of had it been able to continue as a stand-alone council. Those facts cannot be dismissed on the grounds that CCLRC should have planned its budgets more carefully on the basis of a flat cash settlement. That might be true, but it is unfair to saddle former PPARC users with a deficit derived from CCLRC. That is exactly what happened as a result of the budget settlement.

The Government assured us that there would be no legacy issues associated with the merger. They got it wrong and they should take responsibility for that, rather than hiding behind other people’s decisions. Although we know the outcome of the programmatic review, we still do not know what the grant allocations will look like. Will the Minister consider a modest STFC uplift to prevent significant grant cuts if Professor Bill Wakeham recommends that when he reports in the autumn?

The process has been interesting and has raised some fundamental issues about the Haldane principles and the independence of the research councils. It has also raised some very interesting issues about how individual research councils work. At the end of the day, the major problems have not transpired to be as serious as was first thought. I am grateful for that. I hope that when the Minister replies he is able to give not only the community in the STFC but the whole research community the commitment that the Government will seriously consider the recommendations of the Committee, rethink some of them and bring forward new proposals.

7.38 pm

Dr. Roberta Blackman-Woods (City of Durham) (Lab): I, too, am glad to be able to participate in the debate. It is perhaps rare for Select Committee business and constituency business to collide in quite the way they did for me on the matter of science funding. Since becoming an MP, I have spent a considerable amount of
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time establishing a relationship with the science community in Durham. That community is reflected in our excellent world-class university, our science learning centre and Framwellgate school, which is to be rebuilt as a science village.

I have also wholeheartedly supported the prominence that the Government have given to science, and the recognised and often cited need for us to maintain and enhance the science budget given the many years of Tory neglect. Indeed, the uplift in the budget was needed to keep us internationally competitive in an increasingly global economy.

The 2007 comprehensive spending review was flagged up in advance as a very difficult spending round, and so it proved, but I am particularly glad that science funding was protected. As I think the hon. Member for Harrogate and Knaresborough (Mr. Willis) mentioned, science funding has doubled in real terms since 1997, having gone from £1.3 billion then to £3.4 billion in 2007-08. The CSR 2007 allocation made provision for a further rise of £4 billion between 2008 and 2011. That is an average increase of 2.7 per cent. a year in real terms over the next three years. I was consoled by the fact that, despite a difficult spending review, science appeared to be protected, and the Government were continuing to support world-class research and sought to drive up the economic benefit that could be derived from investing in science.

As the Committee’s report points out, the headline figure is a three-year increase in the science budget of 17.4 per cent. As I have said, that reflects a Government commitment to implement the main recommendations of the Cooksey review on health research funding and the Sainsbury review on the role that science and innovation can play in keeping the UK competitive. It is of course true that not all research councils will receive the same percentage of uplift in their budget. As was mentioned, the Medical Research Council will receive a 30 per cent. increase. Nevertheless, overall, even the Science and Technology Facilities Council budget had a planned increase of 13.6 per cent. I will talk a bit more about that percentage later.

I therefore felt some consternation and confusion when I started to receive frantic telephone calls from members of the physics community in Durham about the dreadful cuts that would be inflicted on them after April. That appeared to relate to budget cuts that were to be introduced by the STFC and that would affect not only their projects, but programmes supporting students. Something seemed to be going dreadfully wrong, and I had already made up my mind that the matter needed investigation, but news of the impending disastrous cuts had also reached the Science and Technology Committee, and it took the view that we should look into the STFC issues as part of the wider inquiry on science budget allocations.

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