Putting Science and Engineering at the Heart of Government Policy - Innovation, Universities, Science and Skills Committee Contents

Memorandum 71

Submission from UK Space


  Space is one of the economic sectors with the highest added value, contributing ~£7 billion annually to the UK GDP. It is a hi-tech export-driven sector in which engineering and science blend together seamlessly to underpin a world-class sector growing at over 10% per annum. The space industry's level of investment is equivalent in monetary terms to 12% of the industry's value added (ie its GDP contribution). This means that the UK space industry is about six times more R&D intensive than the economy as a whole.[218]

Space provides several examples of best practice for government investment in science, such as:

    —  both civil and military space systems/services often benefit from a single government-sponsored R&D investment;

    —  Government R&D funding has helped create a public sector "intelligent customer" for space systems and services—in Departments, Regulators and Agencies, and at both policy and implementation levels; and

    —  enlightened public sector procurement policy has turned small long term R&D investment into world-leading commercial services.

  UKspace recommends that it is timely to use the above best practice as guidelines for future public sector investment in science. We would be pleased to elaborate on the aspects of public procurement that are most relevant in this debate.


  Space science (in its broadest sense, including Earth Observation, timing, navigation, telecommunications, biology and astronomy):

    —  Provides a challenging environment which forces the development of leading-edge technologies from the science base.

    —  Provides an intellectually rigorous environment for researchers which forces the advance in scientifically-based endeavours in the space domain.

    —  Underpins much commercial activity—directly as in broadcasting and positioning for example, and indirectly by contributing to the innovation environment in the nation as a whole.

    —  Provides a beacon for the education system to encourage children and students to develop an understanding of, and a desire to participate in, science and engineering.

  We support the proposal for a review of science investment policy and recommend that it address how best to support the whole UK economy rather than individual narrower domains. We therefore recommend that the review be led by a scientifically-qualified economist, eg: from the Treasury.


  UKspace is the Trade Association for the UK space industry. It is jointly sponsored by the SBAC and Intellect.

The Space Industry in the UK is one of the most innovative sectors of the UK economy and as such contributes to the wealth of the nation. It is a large employer of science and engineering graduates—nearly 60% of the industry's labour force is qualified to at least graduate level—compared to 30% for the economy as a whole.[219] Most companies have close links with Institutes of Higher Education and public sector laboratories, often supplying the tools for research in the various science disciplines making up space science.


  Central Government spends £218 million in civil space directly coordinated by the British National Space Centre (BNSC),[220] predominantly from DIUS, DfT, DEFRA, TSB and The Met Office, and most of it through the European Space Agency (ESA) and Eumetsat. Through its contribution to the European Commission it spends significant additional amounts on GMES,[221] Galileo and other FP7 research activities.

One of the major reasons for UK participation in these international organisations is the scientific benefit that accrues. However, the organisational structures used by the UK for managing its participation in these international scientific endeavours often differs radically from those used by competitor countries (in particular in not having a UK Executive Space Agency).


  UKspace believes that a review of science investment policy is required.

Whenever public sector funding for science comes under pressure, there is an understandable attempt to "pick winners" which will be commercially successful when spun out into industry. History shows that such attempts are usually failures; if the commercial value of a development is so obvious, commercial investment will be viable and the investor will not want to share the intellectual property with an academic institute.

  This means that the public sector should invest in high-risk subjects where success is not guaranteed but where success would have major national-scale benefits.

  One of the benefits of a vibrant scientific sector is the cultural change which can be brought about in the nation as a whole, with the general public developing an appreciation of science and technology and reviving the Victorian perception that advances which affect everyone can be made in the UK, rather than only in Japan, the US, France etc.

  Selecting the leader for such a review is difficult. Academics and industrialists will both inevitably bring a history of their domains and will be open to accusations of bias. Our recommendation is that a scientifically qualified economist (eg from the Treasury) may be the most appropriate, able to consider such important issues as:

    —  Given the global mobility of scientists, knowledge and capital, how can UK scientific investment be best framed to maximise the benefits to the UK economy and society?

    —  Given that other countries have a similar requirement and will also be trying to take benefits from UK investment, what actions can the UK take to maximise the benefits to the UK of the investments of other countries?)

    —  When science is done, where does the economic benefit fall? In volume manufacturing of commercial products, some probably falls where the factory is, but some also falls where the R&D site is.

    —  Where is the tax take that results from HMG subscriptions to international scientific organisations such as ESA, CERN, ESO, ITER,...?

    —  Since scientific investment may take decades to have noticeable economic effect, how can science investment policy be arranged to drive the speed of developments and sustain funding over those extended periods?

  Above all we whole-heartedly endorse Lord Drayson's suggestion to favour science investment in areas where the UK has clear competitive advantage. In the case of space science, the evidence for competitive advantage can be clearly seen in the successful, growing, hi-tech, export-driven space industry.

April 2009

218   Case for Space, Oxford Economics, November 2006. Back

219   Case for Space, Oxford Economics, November 2006. Back

220   UK Space Activities 2007, BNSC, July 2007. Back

221   GMES = Global Monitoring for Environment and Security. Back

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