House of Commons - Innovation, Universities, Science and Skills Committee

Science and Technology Facilities Council - Innovation, Universities, Science and Skills Committee Contents

Memorandum 1

Letter from Professor Keith Mason, Chief Executive, Science and Technology Facilities Council

SCIENCE BUDGET ALLOCATIONS INQUIRY

The Committee asked that I provide an update on the activities of the Science and Technology Facilities Council (STFC) since we last corresponded in July 2008[1] and before I appear before the Committee on 4 February 2009. I have provided a summary of progress in a number of areas below.

I am pleased to report that the Council, management and staff have worked hard in recent months to improve the organisation's ability to deliver maximum scientific, economic, and societal benefit. The Organisational Review Panel's report (see below) reinforces our direction of travel. We accept that we have much more to do, unsurprisingly for the merger of two large and complex organisations, and are committed to act upon the Panel's recommendations.

As the Committee is aware, the STFC is a large and complex research council supporting a very broad range of world-leading science. From STFC's creation in April 2007 until July 2008, the focus of the Council and management was rightly on preparing for, and then implementing, the outcome of the Comprehensive Spending Review of 2007.

This delivered a three-year budget which enabled us to support a world class programme across all our research fields, but in doing so we had to rigorously review our priorities, and we recognise that this was sometimes unpopular.

Our goal was at all times to maintain our commitment to scientific excellence, and the consultation on the Programmatic Review of mid-2008 endorsed our approach.

I am enthusiastic about the future direction of the STFC now set in train and confident that we are well equipped to meet the challenges and fulfil the opportunities ahead.

STFC ORGANISATIONAL REVIEW

Following the Committee's investigation into the Science Budget Allocations (HC 215-I),[2] the STFC volunteered to be the first participant in the Department of Innovation, Universities and Skills' (DIUS) reviews of its Delivery Partners, announced in the Government Response to the Report.[3] The review, chaired initially by Dr David Grant and later by Mr Peter Hazell, covered strategy and planning, customer and stakeholder engagement, governance and monitoring and control, delivery, value for money and management of change.

The review process involved a self-assessment exercise[4] and scrutiny by an independent external panel[5] conducted between June and August 2008 and was published, following scrutiny and input from DIUS, on 19 December 2008.[6]

The STFC welcomes the report[7] and had already made significant progress against many of its recommendations prior to publication. Foremost among these include a restructuring of the senior management team, a stronger focus on improved leadership and teamwork and better administrative practices, as well as a clear commitment to open and timely engagement with staff and the wider community. Detailed responses to each of the panel's recommendations can be found in the STFC response, but it is worth highlighting the following:

Recommendations 5, 9 and 11: STFC accepts that the Executive Board should be responsible for all top-level decision-taking. This Board has been streamlined and comprises the Chief Executive Officer, the two Deputy CEOs, Director of Corporate Affairs, Finance Director and the Director, Corporate Services (with responsibility for Human Resources). In addition, STFC Council and Executive are discussing the evolution of the management structure beneath the executive level as part of STFC's ongoing change programme. STFC accepts that it needs further to develop its leadership capabilities as part of its change management programme and is in the process of recruiting an external mentor to help the top team with this. A new Finance Director, Ms Jane Tirard, joined the STFC on 5 January 2009 and there have been further management changes which are referred to below.

Recommendation 3: The STFC recognised the shortcomings of its communications capabilities in its self assessment. Mr Terry O'Connor, a new Communications Director, was appointed in August 2008 from outside the organisation. Under Mr O'Connor's leadership, the STFC has developed a new plan for its communications, endorsed by its senior management team. A restructuring of its Communications function is underway, with effort concentrated on stakeholder relations and external media management, as well as the improved development and delivery of clear communications, internally and externally. The report of our Investors in People assessor has highlighted the improvements in communication that has resulted from these changes (see below).

Recommendations 11 and 12: One of the first priorities for Ms Tirard is ensuring that the STFC has all the necessary financial systems and robust controls required to ensure mutual confidence in the information used for decision making in the next Spending Review. The Council has already moved to strengthen the effectiveness of its interactions with DIUS, and STFC is already in informal discussions with DIUS and our wider stakeholder community, in respect of its approach to the next SR, in particular with regard to the long term nature of many of the STFC's investments.

WAKEHAM REVIEW OF PHYSICS

The Review of UK Physics[8] forms part of RCUK's continuing oversight of the health of disciplines, and was the first in a series of such reviews. The review Panel, led by Professor Bill Wakeham, gathered information on the volume and nature of research being undertaken by physics departments through the first part of 2008 and reported in October 2008.[9] The review considered the priorities for investment across physics as a whole, taking account of the need both to maintain the health of discipline, and to strengthen its wider impact, including economic impact, in the future. The STFC made its own written submission in May.[10]

The STFC welcomed the Review's findings that the strength of the discipline in the UK is high, in particular with regard to the physical infrastructure required to sustain research in the UK. STFC contributed to the RCUK's response to the key findings of the report[11] and welcomes the stated need for continued and increased interdisciplinary working to ensure the continued health of the discipline.

The Panel made recommendations with regard to the STFC's approach to CSR bids (Recommendation 6) with regard to former PPARC facilities and grant funding, and other potential tensions between regional, national and international facilities. The STFC stands by the RCUK response to these points, in that the evidence for all aspects of bids for funding as part of spending reviews is already supplied in detail. In addition, we believe that we need to manage our expenditure as a whole across the newly formed organisation, rather than managing individual budgets in discrete silos. We recognise, however, that the newly formed council has challenges in appropriately tensioning different types of expenditure—for instance, between grants and capital investments, and also with respect to interdisciplinary programmes. On 19 November 2008 I took the opportunity to expand on some of the themes in the report in a speech to the Foundation for Science and Technology, and outlined some of the challenges for the UK, and the STFC in particular, with regard to physics.[12]

We welcome debate in this area and, with regard to some of the unique investment challenges faced by the STFC, we have also submitted a discussion paper to the Committee's Inquiry, Putting Science and Engineering at the Heart of Government (attached)[13] which explores some of these questions and looks to potential routes to their resolution.

With regard to the Panel's call for the STFC Council to be broadened (Recommendation 7), the STFC and DIUS held an open competition to recruit two additional non-executive science members in the latter part of 2008. Interviews with candidates are being held on Friday 23 January with the expectation that the Secretary of State will make appointments effective 1 April 2009 following the interview panel's recommendations.

The Panel made specific recommendations regarding Solar and Terrestrial Physics, Nuclear Physics and High Performance Computing (Recommendations 12, 15 and 17). The STFC has been working closely with NERC, EPSRC and other relevant bodies to progress all these areas positively.

2008 PROGRAMMATIC REVIEW

Following an external consultation process which concluded in early 2008,[14] and an intensive review process conducted by the STFC Science Board and its two key advisory bodies PPAN (Particle Physics, Astronomy and Nuclear Physics Science Committee) and PALS (Physical and Life Sciences Committee),[15] the STFC announced its £1.906 billion investment programme in July 2008.[16] Ten independent specialist panels assessed input from the wider scientific community during a consultation which received more than 1,400 responses from the UK and abroad.

The programme is ambitious, scientifically sound and makes excellent use of the resources available. All projects reviewed were judged as having considerable scientific merit. However, support for some existing work inevitably needed to be withdrawn to create space for new activities. Successfully managing the competing aspirations for the community with the constraints placed upon the STFC will always remain central to the challenges we face, but the successful completion of the review and continued management of resources is of great credit to our management team, advisory groups, staff and stakeholders across the organisation.

STFC STRATEGY DEVELOPMENT AND CONSULTATION

Throughout 2008 STFC has been engaged in a series of conversations, workshops and forums with staff and external stakeholders to develop and agree its strategy for the future, under the leadership of the Director of Corporate Affairs, Gordon Stewart.

Input from external bodies encouraged the development of a strategy that covers all aspects of the STFC's work (Science, Operations, Economic Impact and Education & Skills) in a single place, as well as the development of a framework that can provide clarity and vision for all members of the organisation.

The draft strategy has now been opened to public consultation,[17] and structured engagement with key stakeholder groups, including DIUS, other Research Councils, learned societies and other key stakeholders is taking place over the coming weeks. The formal consultation closes on 20 March 2009, with a view to final publication in April. The Committee's input to this process is very warmly welcomed.

BLUEPRINT—THE STFC CHANGE MANAGEMENT PROGRAMME

IN PARALLEL WITH WORK ON THE STRATEGY AND VISION, THE STFC'S CHANGE MANAGEMENT PROGRAMME, BLUEPRINT, HAS BEEN AN INTENSIVE AREA OF ACTIVITY IN THE SECOND HALF OF 2008 AND WILL CONTINUE THROUGH 2009. WHERE THE STRATEGY SETS OUT THE STFC'S VISION AND GOALS, BLUEPRINT CAN BE CHARACTERISED AS THE WORK UNDERWAY TO ENSURE THAT THE ORGANISATION CAN ACHIEVE ITS GOALS. ITS KEY COMPONENTS ARE: DEFINING THE ECONOMIC MODEL FOR ALIGNING OUR COSTS TO OUR STRATEGY AND FUNDING; PERFORMANCE MANAGEMENT REQUIREMENTS; CORE BUSINESS PROCESSES; ORGANISATIONAL STRUCTURE AND COMPOSITION; INFRASTRUCTURE; LEADERSHIP; ORGANISATIONAL CULTURE; AND CHANGE CAPABILITY.

IN ALIGNMENT WITH THE RECOMMENDATIONS OF THE ORGANISATIONAL REVIEW, I AM THE SENIOR RESPONSIBLE OWNER FOR THE BLUEPRINT PROJECT WHILST RICHARD WADE (CHIEF OPERATIONAL OFFICER) AND GORDON STEWART (DIRECTOR OF CORPORATE AFFAIRS) ARE PROGRAMME SPONSORS.THE CHAMPION FOR THE PROJECT ON THE COUNCIL IS PETER WARRY, STFC'S CHAIRMAN.

REGULAR UPDATES FOR STAFF ARE BEING PROVIDED, INCLUDING A REGULAR NEWSLETTER, AND PROJECT MANAGERS FOR EACH OF THE CORE COMPONENTS HAVE BEEN APPOINTED.

OTHER MANAGEMENT AND PERSONNEL DEVELOPMENTS

The senior management team has been re-invigorated over the last year with the introduction of new faces to the senior team, as described above. The year also saw significant work to implement the Research Councils's Shared Services Centre in Swindon.

At the end of 2008, the British National Space Centre relocated its offices from DIUS to the headquarters of the Research Councils in Swindon, which improves integration and communication with this key body for which STFC is a primary sponsor. This is augmented by the full time secondment of senior STFC staff to the BNSC team.

This year will see the closure programme of the SRS at Daresbury Laboratory enter its final stage, with the last planned round of redundancies, that of the decommissioning team, due to be announced shortly, in line with the agreed timetable. During 2008 the opportunity was taken to celebrate the incredibly successful operation of the SRS over its lifetime.[18] I am particularly grateful to the management team at Daresbury for dealing with the closure programme so professionally, which has understandably been a very challenging and at times stressful process.

INVESTORS IN PEOPLE

On 12 December 2008 the STFC's Investors in People assessor reinstated the organisation's full Investors in People Standard, following some concerns outlined in their assessment 12 months earlier (the full report is attached). The STFC welcomes the report and believes it rightly highlights the hard work being made across the organisation to forge a single culture. The report welcomes the creation of our new unified People Management Standard (CRISTAL) and highlights the successful promotion of new and existing talent within the organisation to key roles at all levels. I continue to be greatly enthused by the description of the STFC as an organisation that "oozes talent" and one where "professionalism, passion and pride [is] displayed at all levels".

CAMPUS DEVELOPMENT

The signing of the Joint Venture Agreement for Harwell Science and Innovation Campus (HSIC)[19] between UKAEA, STFC and private sector partner, Goodman, in October has been an important step in moving forward the long term Campus development project and, in particular, marks commercial confidence in the project despite a difficult investment climate. It is planned for the Daresbury Science and Innovation Campus (DSIC) to develop and issue a European OJEC notice to secure a similar joint venture partner at Daresbury, drawing on the HSIC experiences of this process.

Work continues at pace at the joint research council Research Complex at Harwell,[20] led by MRC, which will provide facilities for life and physical sciences researchers adjacent to the Diamond Light Source, and is now well advanced in construction.

EUROPEAN SPACE AGENCY CENTRE AT HARWELL

Progress at HSIC was quickly followed by the agreement of the European Space Agency (ESA) at its intergovernmental Ministerial meeting to develop plans to locate a research centre at the Harwell.[21] Once established the new centre will play an important part in the development of key technologies and capabilities, particularly new work on climate change modelling that uses space data and the development of technologies for a new era of planetary exploration, including robotics and novel power sources.

LARGE FACILITIES CAPITAL FUND INVESTMENT

STFC has had £236.5 earmarked for investment to develop large-scale research facilities and projects in its science portfolio.[22] The investment was announced in July 2008 by DIUS and is being made available through the Government`s Large Facilities Capital Fund. The STFC projects approved include:

— £50 million for the Hartree Centre, an advanced computational science centre at STFC's DSIC;

— £24 million for a new Imaging Solutions Centre based at HSIC;

— £30 million for a new Detector Systems Centre based jointly at Daresbury and Harwell;

— £25 million for ISIS Target Station 2, STFC's world-leading pulsed neutron and muon source facility at the Rutherford Appleton Laboratory;

— £92.5 million for the Diamond Light Source, in which STFC has an 86% shareholding, for the design and construction of an additional 10 beam lines; and

— £15 million for the Square Kilometre Array to develop the first prototype phase of this next generation global radio telescope.

RESEARCH GRANTS

In recognition of the difficulties caused by the reduction of grants funding to universities as part of the 2007 CSR Allocation, STFC has worked hard to find flexibility in the original programme, largely by identifying management of risk in other areas of the budget profile. The STFC was able to announce in October an increase in our planned spend on research grants by a total of £9 million over the next two years[23] as a consequence.

Following this announcement, the Science Board has agreed to recommend the allocation of an additional £6 million to the Particle Physics, Nuclear Physics and Astronomy grants panels over the remaining CSR period, with the remaining £3m going to support new initiatives in Universities.

The Committee will appreciate that the STFC is involved in a great many projects at any one time and a broad update can be found in the Council's Scorecard.[24] Included below, however, are brief updates on some of the matters in which the Committee will have particular interest.

Nuclear Physics

Further to the Recommendations of the Wakeham review, STFC has been working closely with the RCUK and EPSRC to establish the UK's requirements in this area, particularly in the context of the UK's requirements for skills in this area and taking into regard the recent Nuclear Engineering case study work of the Committee.[25]

Solar and Terrestrial Physics

Further to the Recommendations of the Wakeham Report and following the conclusions of the Select Committee, the STFC has been working with NERC to define ongoing responsibility for ground based Solar and Terrestrial Physics capability.

European Spallation Source

Following an accelerated timetable from European partners with regard to planning towards for future neutron facilities in Europe, a town meeting was held in November 2008 to agree the UK's negotiating position.[26]

I look forward to expanding on these matters when I appear before the Committee on 4 February.

January 2009