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That Linda Gilroy be discharged from the South West Regional Select Committee and Roger Berry be added .-( Mr. Watts .)
Mr. David Heath (Somerton and Frome) (LD): It is a great pleasure to have the opportunity of using a short period of the House's time to talk about something that this country is very good at, which is invention and inventors. It has often been said that Britain is brilliant at invention, but it is sometimes said that Britain is not quite so good at the commercialisation of invention. I want to touch on that, but not from the point of view of large industry research and development, or the people engaged in scientific support for industry, but in support of individual inventors, by which I mean the people working in their garden sheds, their garages and their upstairs bedrooms in order to bring an idea they have fostered to the point at which it can become a reality.
My interest in this subject was sparked by a visit I made a few weeks ago to an organisation called the south west inventors club, which I strongly recommend. It is a group of inventors, as the name says, from the south-west. They meet to exchange information and support each other; they help each other in the gradual development of their individual projects. When I was invited to go, I did not really know what to expect. I suspected that I would not see the caricature of the lone inventor-the sort of slightly distressed gentleman emerging from a shed with a blackened face and hair awry, or, in short, an eccentric. I knew that these were serious-minded people who were very different from that in their attitude.
I was not disappointed. I met a variety of people. Some had a high level of scientific qualification and background; others did not, but had spotted an opportunity that they thought capable of being brought into reality. Some of the things developed in that club-sometimes by my constituents, sometimes not-had already been brought to market. A gentleman had invented a device for fitting to the filler caps of diesel cars to prevent people from inadvertently putting lead-free petrol into the tank. Anyone who has done that knows that it has a disastrous effect on the car and, in due course, on the pocket. The simple device he invented prevented that from happening. Incidentally, it cannot happen the other way around; one cannot put diesel into a lead-free car because the nozzle prevents it being done. I think that that invention is likely to become a big seller and a standard fitting on a lot of cars. I am very pleased that the inventor is a gentleman who lives in Podimore in my constituency.
Another gentleman was demonstrating what he called a multi-stride tool, for use by carpenters, fitters and do-it-yourself enthusiasts to ensure the correct fitting of screws, handles and so forth to doors. He had devised it because he had realised that it was a tool that he himself needed. He had then brought it to market, and it is now being sold not just in Britain but in America, in major do-it-yourself stores. He had cracked it: he had reached that point of departure. I recall that some years ago a gentleman from Bower Hinton, also in my constituency, invented a completely new set of spanners. Working on a farm, he too had realised that such an invention was needed.
What unites so many inventions is that once we have seen them, we think "How obvious", and wonder why on earth they have not always been there. The answer is that it was necessary for someone to have the necessary spark to invent them. As I have said, I was very impressed by many other inventions that I saw that evening, but I cannot speak about them because the intellectual property rights have not yet been ascertained, and they must therefore remain secret. What I can say is that I witnessed a display of mutual support and mutual giving of information. I also realised that there was a capacity problem, and also a problem with advice and support.
I do not have up-to-date figures, but the figures that I have suggest that between 2002 and 2005 the number of patents filed fell from 20,000 to 17,000, which is a 15 per cent. drop. The patents that were filed must have been of better quality, because the number of patents granted increased by more than 13 per cent. Up to a fifth of all the patents filed were granted during that period. A quarter of the applications were made by lone inventors, which means that a large proportion of the inventions were developed not by big business or industry, but by the individual.
What problems do inventors face? There is the problem of getting their ideas to the point at which they can be marketed successfully, part of which involves understanding the market itself: understanding what the market wants, and how their ideas fit into what is already there. Another problem is understanding what investors seek from a person whom they do not know and who wants to promote an idea. Inventors also sometimes have problems in filtering their ideas in order to identify the runners and the non-runners. That too may seem obvious, but it is not, and it requires expert help.
Inventors often need advice on strategy: on the analysis of the market, competitors, and the skills that are required to enable them to take their inventions to market. Then they hit the big barrier of patenting and the legal issues associated with protecting their intellectual property rights. That involves expense, but it also involves expertise. They must know how to set about the process, and how to protect themselves from the rather better-equipped lawyers acting for businesses that might want to exploit their inventions. Then there is the development of a prototype. That too needs initial investment, which will often be hard to come by. They must get the invention off the drawing board and turn it from something built with string and plasticine into something that can be demonstrated to work, and demonstrated to work to the satisfaction of the partners that they will need in order to proceed.
In some parts of the country there is a lack of support schemes, although in other parts there are good ones. The south west inventors club is an example of a good one, but provision is patchy. Support schemes are helpful in several ways, such as in pointing to those who offer genuine help and in warning against those who fraudulently offer support in order to steal ideas.
There is also a problem in getting big business interested in the amateur, because it is often not interested. It works by looking at its own products and development streams. If someone has an idea that is of relevance, it can be hard for them to identify who in the corporate structure might listen and be willing at least to take them to the next step.
What are the remedies? I do not pretend that I have all the answers, and nor do I pretend that nothing has been done before now to meet some of the demands. I have mentioned inventors clubs; I would like there to be many more of them. They should be promoted. The peer review that is inherent in such clubs' activities is of great benefit, as is the mutual support they offer.
Organisations such as Business Link and the regional development agencies must be fully engaged. Business Link is very good in terms of what it makes available online-it has comprehensive website support. In some other areas, too, it provides exactly the sort of help that people need for the initial stages. Again, however, this support is patchy; it is not consistently provided across the country as that very much depends on the enthusiasms of local organisations. I do not think that RDAs do nearly enough on this, however. They do not recognise the huge potential economic benefit in seeing such ideas brought through the stages of development to eventually creating jobs and wealth. RDAs are simply not set up to identify these opportunities, but they should be.
The British Library is also enormously valuable in this regard. I was not previously aware of that. Shortly after I discovered that I had secured this debate and it was advertised, I was contacted by the public affairs manager at the British Library, who said, "You do know what we're doing already, don't you?" I am a great fan of the British Library. I visited it to attend an exhibition only a few months ago, and I think it does a great job. In 2006, it set up the British Library business and intellectual property centre, which provides a lot of support to those businesses who can find their way there-that is the critical factor, of course. It says it has welcomed 100,000 businesses since it opened. Interestingly, it also said it had recently experienced a marked increase in the number of people finding their way there, particularly among people who are unemployed. Perhaps one reaction to the recession is that people who have been nursing an ambition for a long time are thinking, "Now is the time. I'm going to do something about this", and they are trying to make use of the support that is on offer.
The centre at the British Library offers some of that support, but-and it is a big "but"-it could do more if it had a little more investment and connection with the rest of the country. The British Library is a national resource, but it is in London. It is online, so it is available to everyone via the web, but there is a difference between getting information online and actually going and talking to someone face to face. I therefore wonder whether we need a greater ability to use the facilities of the British Library in other parts of the country in order to provide support.
The key issue is so often funding and finding the right business partner-business angel-to take a project forward. I have a pedantic issue with the popular TV series "Dragons' Den"-its name. Dragons do not live in dens; however alliterative that may be, they live in lairs. That puts me off, but it is a very good and entertaining programme, and it provides a real connection between people with money and people with ideas, so that the money supports the ideas. We need more dragons' dens; we need an easily available one in every part of the country, rather than just having a television programme. We need something that puts people with money in contact with people with ideas and enables them to come to local agreements.
My final point perhaps deals with a much bigger issue, although I am unsure whether it falls directly within the context of this debate I wonder whether it is time that we should start to think in terms of local-regional-stock exchanges. We are used to the investment money that flows through London, but London is not the country as a whole. I would love to see a stock exchange in Bristol or Bath, in Cardiff and in the cities of the north of England. That would provide the opportunity for local people to invest in local entrepreneurs and provide that sort of funding. This is an idea whose time has perhaps come, and I impress it on the Government as something that should be examined.
In summation, I am saying that there are people with great ideas who have a problem: they often face so many barriers in taking those ideas forward to the point at which they go into production and start creating jobs and wealth. A relatively small amount of support, in addition to what is being supplied, could unlock a huge amount of capacity for innovation and invention across the country. I am inviting the Minister to agree with that proposition and to take away the thought that this is something that the Government can usefully do, not just centrally-not just here in the capital-but across the country, so that all those people with their bright ideas in their garden sheds end up with the factories producing the goods, which will help us through the current economic problems and to a much brighter future.
The Minister for Higher Education and Intellectual Property (Mr. David Lammy): I congratulate the hon. Member for Somerton and Frome (Mr. Heath) on securing this debate and on the manner in which he put his remarks. I hope that he will also allow me a moment to congratulate a native of Frome, Jenson Button, on becoming Formula 1 world champion. If we praise Mr. Button's success, we must also recognise that it was made possible by the inventiveness of his British-based team, so, I welcome the hon. Gentleman's choice of subject for this debate.
Invention is an important subject in a country whose competitiveness in world markets, no less than on the race track, depends increasingly on its ability to make technological breakthroughs and put them to good use. Sometimes those breakthroughs are the product of big-money investment by big business, sometimes they are the result of practical applications being found for discoveries made in our universities and sometimes they happen just because the proverbial lone inventor has a bright idea-the hon. Gentleman has elucidated that-while doing the washing up, for example.
For many inventors there is often a missing link somewhere in the chain. Whether we are talking about funding at an early stage, protecting their intellectual property, developing a prototype, finding the right partner or bringing the product to fruition and to market, we need to create an environment in which innovation can thrive. The Government recognise that, which is why we and our partners have a raft of ways to help inventors bridge those gaps.
The hon. Gentleman is right. We have traditionally been very good at invention in this country, but we have been far less good at commercialisation. Many of the
new industries and technologies that we now rely on, particularly those to do with the internet, were born out of the previous recession in California. We need to get better, and all our policies are aimed at ensuring that.
Any inventor's first port of call for advice should be the excellent Business Link website. It offers a wealth of advice, including tips on commercialisation and legal issues, and contains links to other sources of local and regional support for inventors. However helpful the advice on offer is, finances will undoubtedly, of course, be one of any inventor's chief concerns. This is an area where I hope that our record of investment is beginning to bear fruit. Since 1997, public spending on the UK science base in particular has more than doubled. Although much of that money has been spent in universities and research institutes, it has undoubtedly helped to bolster sectors of the economy that will drive future growth. They include life sciences, low-carbon technology, digital media and advanced manufacturing.
Focusing investment in invention and innovation on areas where we have existing strength and potential future competitive advantages makes sense at any time, but it is more important than ever as we begin to emerge from recession into recovery. Help is available in the form of grants for research and development. They provide funding which can be used to fund proof of concept, research, prototyping, patenting and product development costs.
The grant for research and development is a Solutions for Business product, which can help to introduce technological innovation in businesses. The grant provides finance to individuals and small and medium-sized businesses in England to research and develop technologically innovative products and processes. It is a national scheme that is run and funded by the regional development agencies and the budget for the grants available to inventors in the south-west is £1.5 million this year.
In previous years, that money has supported a number of individuals and small companies in the south-west in taking their product to market, such as the grants that went to Fluvial Innovations, a multi-award-winning company that provides functional and economical solutions against the risk of flooding, and Xintronix, a high-tech semiconductor company that was supported by UK Trade and Innovation and the South West of England Regional Development Agency. These companies are two of a number of companies that had just one employee at the time of application.
I recognise that some call for full funding through the grant for research and development, but that is not right in principle. We cannot fully grant inventors the whole cost of their inventions, as all serious inventors need to share the risk of their inventions. Beyond that, there are state aid rules that preclude 100 per cent. support for any inventions.
Collaborative research and development is another Solutions for Business product that provides grants to help cut the cost burden associated with bringing research to market. The grants are delivered as part of the activities of the Technology Strategy Board. We have also introduced innovation vouchers to enable small and medium-sized enterprises to buy support from knowledge-based institutions so that they can explore potential opportunities for collaboration in developing new products. Innovation vouchers are being piloted
nationally, and the pilot will start in the south-west region in April 2010. The hon. Gentleman will want to ensure that the inventors whom he has met recently are able to access those innovation vouchers.
A number of other agencies around the UK fund innovation. Time prevents me from mentioning them all, but they include the National Endowment for Science, Technology and the Arts, the Design Council and the 10 EU-funded business innovation centres. In addition to grants, many inventors will need some form of equity finance if their inventions are to be realised commercially. The British Business Angels Association and the British Private Equity and Venture Capital Association provide help with all aspects of business angel and venture capital support.
This is a tough time for venture capital, but the support is there. Business Link also has a comprehensive guide to equity finance that explains the Government grants available to help finance parts of projects.
Funding can be a key issue, and as the hon. Gentleman said, other aspects of inventing can be complicated, too. Most inventors are looking for quality intellectual property advice, and the Intellectual Property Office and its partners have developed a suite of products to guide them through the process. There are online databases, such as the one run by the British Library and the European Patent Office to which the hon. Gentleman referred. Inventors can search them for patent documents for free, and I hope that many of the applications are granted as a result of the advice that is available.
There is also an intellectual property tool online, known as the IP Healthcheck, which is free to use and helps inventors answer questions about intellectual property. It is broken down into the four elements of patents, trade marks, designs and copyright, each of which should take no more than 20 minutes to complete. Advice and help on searching patents, designs and trade marks is also available through the network of 13 patent information libraries, two of which are in the hon. Gentleman's area, at Bristol and Plymouth.
The IPO also runs a programme of free intellectual property awareness seminars across the UK, aimed at businesses that want to find out more about the benefits of using intellectual property. The IPO also produces a guide to the advantages and disadvantages of seeking patent protection, and it also offers help with the use of trade marks. For the past 10 years, the IPO has supported the ideas21 network for inventors, which enables successful inventors, business and intellectual property professionals to help would-be inventors through the complex process of turning an idea into a commercial success.
Among many other initiatives, the IPO is currently working with partners to develop a standard for invention promoters. Most invention promotion or marketing companies are perfectly reputable, but I know, as was said earlier, that too many inventors have fallen foul of unscrupulous operators in that area. I hope that the new standard will help inventors to market their ideas with more confidence.
The hon. Gentleman mentioned the effects of fees for patents on inventors. Although patents do entail an outlay, the fees chargeable for an initial patent remain well below cost price. Indeed, the real cash price of a patent is lower now than it was 150 years ago-notwithstanding the involvement of lawyers in this area.
The Government encourage and support invention, but we do not pick winners. Instead, we want to create the right environment for invention and innovation to thrive. When inventors are ready to take their invention to market, we help them identify the best way to find a potential licensee. We also offer guidance about the non-disclosure agreement process by which they can secure a confidentiality agreement before revealing their idea.
We also encourage collaboration with business or universities. I particularly mention universities. There are so many spin-outs coming out of our universities for inventors to be plugged into what is happening in that hub in their local area. Business Link does what it can to ensure that right from the beginning, all the advice is available. It will be regional and it will be different in different contexts. We know that it is not perfect, and we want to make it better. I hope that in my short contribution I have set out all that is available.
Regional development agencies are important in this context. The overall spend on innovation is £260 million across the region. It must be for RDAs to determine local priorities, but I know that that is understood in the south-west. It is an area where creative businesses have been at the hub of activity, not just locally, but nationally. I commend the hon. Gentleman for bringing the matter to the House, and I hope I have set out how we are attempting to provide support. We can get better and we must do so. We must be in a position to commercialise invention and bring to full fruition the innovation nation that the Government have always said we must be.
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