Plastic electronics engineering: innovation
and commercialisation
8. The UK is well placed to capitalise on the
economic potential of the growing plastic electronics industry.
However, we are concerned that without a clear understanding of
how best to build on and market the UK's strengths in this sector
this opportunity might not be fully realised. We urge BERR to
engage with the Technology Strategy Board, UK Trade and Investment,
UK Displays and Lighting Knowledge Transfer Network and the plastic
electronics community to develop a technology roadmap. In constructing
this roadmap it is essential that stakeholders across the sector
be consulted, from spin-out companies to multinationals. (Paragraph
72)
We welcome the Committee's recognition of the UK's
position to develop new products and capitalise on the potential
of this emerging industry, which is in part the product of past
investments by the former Department of Trade and Industry (DTI),
the Technology Strategy Board, the Engineering and Physical Sciences
Research Council (EPSRC), the Regional Development Agencies of
England and the Devolved Administrations of Northern Ireland,
Scotland and Wales.
The recently published strategic policy statement,
'Building Britain's Future: New Industry, New Jobs', outlined
that Government can and must be intelligent about ensuring its
actions deliver a high value, high skilled economy able to respond
to long-term opportunity. It highlighted the need for concerted
action to back businesses in markets and sectors, such as plastic
electronics, where Britain has strength and Government can make
a difference by clearing obstacles or correcting market failure.
In this context, BIS officials, Technology Strategy
Board staff and KTN staff will work alongside key players from
within the UK's plastic electronics sector to develop a UK Strategy
for Plastic Electronics that will identify the UK's main strengths
and how businesses throughout the supply chain can best take advantage
of future commercial opportunities. Due for publication in the
autumn of 2009, the strategy will also define the role for Government
in unlocking competitive potential of this emerging industry.
A draft for consultation is planned for Summer 2009
with the formal launch of the strategy in Autumn 2009.
9. We welcome the support for plastic electronics
research and development provided by EPSRC and the Technology
Strategy Board, and believe sustained support by these organisations
is vital to the growth of the industry. (Paragraph 80)
Plastic Electronics remains a central theme within
the Technology Strategy Board's technology strategy and significant
levels of support have already been delivered through direct support
from the Technology Strategy Board, the Research Councils, the
RDAs and the National Measurement System.
The Engineering and Physical Sciences Research Council
is currently funding over £73m of research of direct relevance
to plastic electronics and the Technology Strategy Board has committed
a further £9.6m investment in projects in the field of Plastic
and Printed Electronics, in the last 18 months, including funding
a £12m project (£6m grant) to develop full colour flexible
displays.
10. We do not believe that the Technology Strategy
Board's grant schemes and the Managed Programme proposed by UKDL
KTN and the former-DTI are mutually exclusive forms of support.
UKDL KTN champions the needs of the plastic electronic community,
and as such we urge BERR and the Technology Strategy Board to
engage with it, and to reconsider the deployment of a Managed
Programme in this area. (Paragraph 89)
As noted above, Plastic Electronics remains a central
theme within the Technology Strategy Board's technology strategy
and as part of its programme to stimulate innovation in the field
of Plastic and Printed Electronics it will hold a 'sandpit' in
January 2010 with an £8m Challenge—"To exploit
the UK wealth potential of plastic and printed electronics".
The sandpit will aim to identify unique UK capability in plastic
electronics and that will result in end-use applications and also
produce demonstrators by engaging new players, end-users, business
leaders and creative designers.
The Technology Strategy Board is also working with
the Regional Development Agencies and Research Councils to co-ordinate
investments that are informed by the work of the KTN and BIS,
which will help define the needs of business.
11. The future success of the UK plastic electronics
industry not only lies in its ability to lever public and private
finance, but also in the co-ordination of funding sources. We
recommend that BERR, the Technology Strategy Board and UKDL KTN
take immediate steps to increase the understanding of technological
risk in the private sector, and to review the funding landscape.
(Paragraph 95)
Following Lord Sainsbury's 2007 Review of Science
and Innovation, the Technology Strategy Board has made good progress
in working with other funding partners to address fragmented technology
and innovation landscape, and create critical mass and coherence
to the support provided to improve the technology and innovation
capability of UK business.
Furthermore, the Government recently announced Solutions
for Business (a simplified framework for business support), which
is now in place to offer real help to companies with common issues
such as accessing finance, support for research and development,
skills and training, exporting and overseas trade.
Finally, in the context of securing access to Venture
Capital, there are now 10 Enterprise Capital Funds providing venture
capital investment in amounts of up to £2 million and a number
of these Funds have a strong technology focus. Further measures
have also been taken to support businesses during the downturn
including Enterprise Finance Guarantee and the Capital for Enterprise
Fund. The Government's recently published strategic policy statement,
'Building Britain's Future: New Industry, New Jobs', outlined
a commitment to consider whether, and in what form, further intervention
could help increase the supply of long term growth capital to
small and medium sized businesses. This will include options for
a Public-Private Partnership similar to the predecessor of 3i,
the Industrial and Commercial Finance Corporation, leveraging
private sector capital to address gaps in growth finance and risk
capital.
We also recognise the important role that the Technology
Strategy Board and KTNs have in increasing the understanding of
this emerging industry amongst private investors. The KTNs in
particular bring together a variety of organisations, such as
businesses (suppliers and customers), universities, research and
technology organisations, with the finance community and other
intermediaries to provide a range of activities and initiatives
to enable the exchange of knowledge, which can help address any
information deficiency that could hinder private investment in
the sector.
12. PETeC's location is a function of the fact
that it was established as a regional initiative. It is an open
question whether PETeC would have been sited elsewhere had it
been founded as a national resource, something that it undeniably
is. However, we do not see further discussion on this issue as
constructive or worthwhile, and wish to see a line drawn under
the debate. (Paragraph 100)
We welcome the Committee's support for this important
initiative and agree with its conclusion.
13. We are sympathetic to PETeC's need to generate
income in order both to assure its future survival and to allow
it to participate in UK grant competitions. The Technology Strategy
Board and OneNorthEast should review whether the requirement for
self-sustainability within five years is realistic. (Paragraph
104)
It is important that PETeC works towards independence
from regional development funding as befits its status as a technology
and innovation facility for a national and international audience.
However, there is no restriction on PETeC participating
in industry led projects seeking grant funding from the Technology
Strategy Board. Furthermore, the role and value of PETeC will
be considered in the context of the UK Plastic Electronics strategy
highlighted above
14. We urge PETeC to continue developing its relationships
with other Research Centres, and to liaise with these Centres
to ensure national capability in facilitating R&D across the
spectrum of plastic electronic technologies. (Paragraph 106)
We agree with the Committee's recommendation that
tying PeTEC into world class research centres will be critical
to its success. The Displays and Lighting KTN is coordinating
links with other centres so that they provide a national, complementary,
capability addressing a broad range of issues across key areas.
Furthermore, the Technology Strategy Board and BIS staff sit on
PETeC's advisory board, with a view to ensuring such links are
developed and maintained.
15. The plastic electronics industry is likely
to grow substantially over the next few years. Although the UK's
research base puts it in a unique position to capitalise on this
growth, we must not be complacent as countries such as Germany
and the USA are becoming increasingly competitive. We recommend
that the Research Centres supporting UK plastic electronics R&D
engage with the academic research base to ensure state-of-the-art
facilities are accessible to the academic community. (Paragraph
112)
PETeC expertise is available to academic institutions,
and there is scope for academics to utilise the facility in the
context of specific industry led projects funded by the Technology
Strategy Board.
Furthermore, the Research Councils provide support
for Innovative Manufacturing Research Centres (IMRC) such as the
Innovative electronics Manufacturing Research Centre (IeMRC) with
a 'hub' at the University of Loughborough and partners from a
number of Universities across the UK. IMRCs provide the UK's leading
manufacturing researchers with a base of stable yet flexible funding
to pursue strategic research themes that are responsive to the
needs of UK industry.
16. The UK academic research base should be applauded
for its strong record in 'spinning out' start-up companies. Focused
support, however, is needed to ensure these businesses grow into
world-class enterprises. We recommend that the Technology Strategy
Board, BERR and UKTI consult with UK business, from start-ups
to multinationals, to identify how best to support the growth
of innovative businesses in emerging industries. (Paragraph 120)
Following the recommendations of Lord Sainsbury's
review, the Technology Strategy Board has established an Emerging
Technologies Steering Group to bring together various agencies
involved to drive a competitive position and significant value
creation for the UK in new high growth markets or industries based
on emerging technologies.
The Technology Strategy Board will publish a final
strategy highlighting its approach to supporting emerging industries
this year.
UKTI will continue to use the Regional Challenge
Fund to promote UK plastic electronics capability internationally.
17. We encourage the Technology Strategy Board
to engage with multinational companies across Europe to determine
whether pan-European consortia could be established to progress
the development of emerging industries with the potential for
high economic returns. (Paragraph 128)
We agree with the Committee's assessment that there
are benefits to be had from closer collaboration with companies
across Europe.
UK businesses and researchers have to date benefited
from funding and collaboration provided in the European Framework
Programme 6, and BIS have successfully influenced the European
Commission to include plastic electronics as a key theme in Framework
7.
The Technology Strategy Board has also, since its
establishment as an NDPB, taken over support for the EUREKA programme,
and the offer of advice and guidance on Framework Programme 7
to encourage more UK businesses to take advantage of significant
opportunities for collaboration with European partners through
EU funding programmes.
Furthermore, the Technology Strategy Board will also
increase the support its KTNs give to international activities,
recognising the increasingly global nature of innovation and business
in general.
More details on the Technology Strategy Board's international
strategy will be published shortly.
18. The manufacture of plastic electronics devices
is not destined to occur outside of the UK. However, we are extremely
concerned that without urgent action by the Government this will
be the reality. As in our previous recommendation (Paragraph 72),
we urge the Government to engage with the plastic electronics
community, and to articulate a strategic vision for the development
of this innovative industry. (Paragraph 130)
We agree with the Committee, and the UK Plastic Electronics
strategy currently under development will consider the role of
manufacturing and the role of wider Government in securing high
value-added activities here in the UK.
19. Support for innovative businesses as they
transition from being primarily R&D focused to launching pilot
manufacturing lines is imperative. We recommend that the Government
consider whether there is merit in establishing an open access
fabrication facility for the manufacture of Plastics Electronic
devices by UK SMEs. (Paragraph 133)
We agree with the Committee and believe this is a
role fulfilled by PETeC.
20. The economic opportunities provided by this
growing industry do not only lie in the manufacture of devices,
but also in the development of enabling technologies. It is imperative
that any national strategy for this industry must embrace the
materials supply chain, particularly as this sector holds huge
potential for UK industry participation. (Paragraph 138)
We agree that in order for the sector to be successful
we need to consider the entire value chain and engage in areas
where UK can have the most impact. This will form part of the
UK Plastic Electronics strategy that is currently being developed.
21. Public procurement has the potential to be
a valuable tool in driving innovation. We welcome the Government's
efforts to develop innovative procurement mechanisms, and recommend
it supports pilot projects in the area of plastic electronics
in order to stimulate product development and manufacture. (Paragraph
148)
We agree with the Committee's assessment of the role
of public procurement, and believe that the commitment that during
2009, all Government Departments must publish Innovation Procurement
Plans, will embed a clear obligation to procure goods and services
in a way that drives innovation, and to identify clearly the areas
in which they are seeking to procure innovative solutions to help
deliver their objectives.
Expansion of the Small Business Research Initiative
(SBRI) will help reinforce this by using the chance to compete
for Government procurement contracts to incentivise early-stage,
high-technology businesses and support these companies through
a critical stage in their development.
However, we do not believe that procurement should
be designed with a view to supporting a platform technology such
as Plastic Electronics, but believe that a clearly articulated
need or application by a Government Department could provide opportunities
to support the growth of UK companies in this area.
22. The Small Business Research Initiative (SBRI)
is potentially a valuable source of funding for innovative companies
in the UK. Our concern is that unless this support mechanism is
re-launched in a format accessible to SMEs developing future technologies,
UK companies will refocus their business models to engage with
the lucrative procurement opportunities offered by the US under
its Small Business Innovation Research programme. We ask that
DIUS keep us updated on progress made in rolling-out the revised
SBRI. (Paragraph 155)
Following Lord Sainsbury's Review and the Innovation
Nation White Paper, the SBRI programme has been reformed with
a view to:
- Help with development of leading-edge
technologies and innovative products to meet the Government's
future needs ahead of commercial procurement.
- Increase access and opportunity by high-tech
SMEs to Government R&D contracts which develop hard technologies
and innovative products.
- Drive an increase in demand for R&D services
from early-stage—high-tech SMEs, and to support them through
a critical stage in their development and thus establish future
industry in the UK.
- Ensure that the SBRI programme complements and
where appropriate enhances the Government's other business support
products for SMEs.
Building on the successful pilot competitions run
by the Department of Health and the Ministry of Defence in 2008-09,
the reformed SBRI programme will be implemented by the Technology
Strategy Board and extended in 2009 to involve a wider range of
departments and an increased number and value of competitions.
The revised structure is well-structured, focused
on technology development and demonstration (£300k to £1m
per project), phased to reduce risk, and attractive and accessible
to industry. As an example, the pilot competition in Health is
seeking technologies for hand hygiene and rapid pathogen detection
in hospitals—two essential tools for conquering healthcare-associated
infections—which will save cost and lives compared with
what is available today.
The Technology Strategy Board has recently used the
mechanism to help develop sustainable construction technologies
suitable for retrofitting into social housing, and we will keep
the Committee informed of developments in rolling out SBRI more
widely.
The programme will also be annually monitored and
evaluated by the Technology Strategy Board in order to ensure
its effective performance and impact on both the buying Departments
and suppliers. The annual performance results will be published
on BIS and TSB websites.
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