House of COMMONS









Monday 26 January 2009


Evidence heard in Public Questions 1 - 27





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Oral Evidence

Taken before the Innovation, Universities, Science & Skills Committee

on Monday 26 January 2009

Members present

Mr Phil Willis, in the Chair

Dr Ian Gibson

Dr Evan Harris

Mr Gordon Marsden

Ian Stewart

Graham Stringer



Witness: Rt Hon Lord Drayson, a Member of the House of Lords, Minister of State for Science and Innovation, Department for Innovation, Universities and Skills, gave evidence.

Q1 Chairman: For our second session this afternoon, could I welcome the Minister, Lord Drayson, for his first Science Question Time, and just to say for the record that when a Minister for Science is in the House of Lords, and therefore we do not in the House of Commons have the opportunity to question him or her at the despatch box during official Question Time, we invite the Minister to a Question Time with the appropriate committee, and we are delighted that not only did Lord Drayson agree but in fact offered to continue with the Science Question Time which indeed my predecessor Dr Ian Gibson and Lord Sainsbury agreed some time ago, so we are very grateful to you for that. The process is that we let the Minister know the key areas that we wish to question him on, I will read out the first question, the Minister gives a brief reply, and then in fact we will question him from that. I am going to start with question 3, Lord Drayson. Does innovation, in large and small businesses, have to be a casualty of the current economic situation?

Lord Drayson: No, I believe it does not, Chairman. That is based upon my own experience as having been a science entrepreneur myself, but also what the data tells us about the way in which other countries have successfully dealt with difficult economic environments, and how actually continuing to invest in science and innovation is the way in which companies can successfully navigate these very difficult times. I believe that market share is won or lost in a downturn to a far greater extent than in good times. That presents opportunities for companies to invest, to maintain and develop their positions. It is important that they seize that opportunity.

Q2 Chairman: Minister, it has been for many years now the policy of the British Government, both in terms of pure research and also in terms of transitional research or moving research through to wealth creation, not to be involved in picking winners. Do you think the time has come to change that policy, during this recession, and to become far more clear in terms of where in fact government funding is going to go in terms of research and development?

Lord Drayson: I think that we need to look at the global environment, we need to note that the countries with whom we are competing have made strategic choices about the areas in which they believe they are best placed to focus. They are marshalling their resources in those areas, and they are often going further than that, they are targeting leading academics, leading companies in our country, and trying to attract them to theirs. So we have a global environment where it is not so much that other countries are picking winners, but they are making strategic choices about what they regard as areas of priority. In that environment, I do believe that there is a strong case for us to say what is the answer to the question of where the United Kingdom is best placed to compete in the future, based around an analysis of the strengths which we have, both within our research base and our industrial base, and recognise that we have to see a rebalancing of our economy post the credit crunch and the global economic downturn. I think we need to have a hard-nosed look at where we have real strategic advantage.

Q3 Chairman: Where is our strategic advantage?

Lord Drayson: There are a number of areas. An area which I would point to where the UK has something that nowhere else in the world has is in the asset of the National Health Service. The whole world faces the challenge of aging populations and the almost exponential growth in healthcare costs, so there is an enormous need for the development of effective modern healthcare. We in this country are uniquely placed because of the asset which we have in the NHS. This is something which our whole society has supported. The patient databases, the expertise that exists within the NHS provides a unique opportunity for us to not only develop a world class healthcare system free at the point of use, but also to develop a real strength in the life sciences, the development of medical interventions, both pharmaceutical, biotechnology and medical devices, and in doing so, create a world leadership position which can then be converted into jobs and exports. Recent trends, for example, in the way in which in cancer research we have seen arguably now that the strongest place in the world to do cancer research is here in the United Kingdom, and the way in which the general public have consistently supported medical research charities, and the fantastic partnership that exists between the NHS, the science base, the work the MRC is doing and these medical charities, I think that is an example where clarity around a real strategic strength could be converted into a real leadership position for the UK.

Q4 Chairman: Minister, just before I bring Dr Gibson in, in terms of clarity around strategic strengths, are you actually saying therefore that as Science Minister, you would be arguing within the cabinet that in research terms, we should in fact be putting greater resources into these areas like medicine and life sciences, and in so doing at the expense of what? Is there a recognition that that would have to come at the expense of something else?

Lord Drayson: Firstly I would say that the very nature of science means that you need to have the underpinning science across the piece, so for example to do good life science research you still need to have good statisticians, you still need to have good physics.

Q5 Chairman: But not good medieval historians.

Lord Drayson: I think we have to ask ourselves whether or not this competitive environment which we face requires us to be crystal clear about what is the vision for this country's future, and how does the research base best support the development of this country in an economic world which is going to rely upon us being really quite excellent at the conversion of science and innovation into wealth. There are areas that I believe we can be extremely successful in. I think life sciences and the earth sciences are two areas, for example, which are both bang smack in the area of huge global growth and opportunity; they are also areas where the UK has real strength, and areas which we should capitalise on.

Q6 Dr Harris: Sorry just to press you on the point, but we have a limited research budget going through the research councils, and we saw the huge arguments that there were about some changes in terms of solar terrestrial physics through STFC, and the huge furore that that actually caused with some re-adjustment of those budgets. What you appear to be calling for is a much more significant re-alignment to actually support these strategic priorities; are we clear that that is what you are supporting? Because you cannot have it both ways.

Lord Drayson: No, I recognise that. I am calling for a serious debate about the areas of focus for this country in the future, and this is not about ministers making these choices. We do have, I think, a very effective process based upon both peer research and, for example, initiatives such as the technology strategy board, but it is about having a debate about the question, just asking the question. Given that we are in an environment where other countries are doing this, given that we see real need to rebalance our economy, we need a diversified economy, but we need to be clear about what are the key assets which the United Kingdom has which puts it in a relatively strong position, and where are those assets best deployed to ensure that we are playing to our strengths? That is a debate which I know will cause some interest, but I do think it is one which we need to have because it is the reality of the environment in which we operate as a country.

Q7 Dr Gibson: It is like the school curriculum, I guess, when you talk to people about what is wrong with the science teaching, the engineering teaching, all that stuff, physics and maths, you get to the point when you say, "What would you drop?" And nobody wants to say, "Forget chemistry". I would, but other people would not say that. Are you tough enough and is the Cabinet of this country tough enough to actually say, "We are going to drop this and we are going to go for this"? Now universities made that decision, because we dealt with the furore of closing chemistry departments and physics departments and so on, and those universities have grown, actually. It is a hard decision to get away from the old world of how science was taught and how science is practised. Are you tough enough to do that, really is the question, and what would it be first? Who has got it coming to them first?

Lord Drayson: Well, there is, I think, a real need for us to debate this question and to come to a settled view of what is the long-term vision for the development of this country in a modern age. The opportunities which exist for us to exploit this tremendous strength which we have in science has to be paid for by somebody, and that money comes from us being a country which is fit enough to be able to pay its way. For that to happen, we have to be really excellent in these areas of the future which are going to be the drivers of economic growth. Now we do have the resources to do it. I believe that if we are smart in the way in which we make those decisions, then we can grow this country very effectively even though the environment is very difficult, but it does require us to make these choices. These are very difficult choices to make. I do not think it is going to be helped by people sort of reducing this debate down to headline, "Ministers pick winners"; that is the easy old rhetoric. If I think about the decisions which I had to take when I was in business, if I think about the decisions that I have to take just in my life, in a business you have to choose what it is you are going to focus on; in your life you have to choose what it is you are going to focus on. I think countries do have to choose what they are going to focus on. But you do have to have a strong and broad science base to be able to do anything, and so one should not make the mistake of just taking a thin slice through and saying, "Okay, we can get rid of all of that because that is not necessary". We need to recognise that a strong science base requires strength in these broad fields, but in terms of the balance of investment, linked to a clear sense of the strategic vision of where this country can be most successful and grow, I think that would be hugely added value, because it would also give a real coherence and alignment to decisions which we make around industrial policy and around educational policy, and I think we can look at previous examples of other countries who have done this very successfully.

Chairman: You have not answered Dr Gibson's key question.

Q8 Dr Gibson: I do not think he can really, because it would be hard for him to say, "I am going to close Oxford University and everything in it, and everybody from Oxford will go to Cambridge". That is the kind of breadth of some decisions you have to make, because scientists accumulate round each other. People go to where excellence is. In all the discussions we have had in the last hour, you have not said anything about that. For example, my favourite university is Dundee. Phil Cohen got a lot of good people to go there, and it has just exploded, because people went there because of the work he did. I think that happens in Oxford and Cambridge and elsewhere, and you cannot do that everywhere. There are only a limited number of excellent scientists, and they will always gravitate where other people are. It is not quite like football teams yet, but it is a bit, with RAE exercises now. People gravitate to certain places. So other places might have to close their biology or whatever because you cannot have two places in East Anglia doing biology, you only need one.

Lord Drayson: So if I am right in understanding the question, are you asking me, do I believe that there would need to be more concentrations?

Q9 Dr Gibson: Yes.

Lord Drayson: Yes, I do believe there would need to be.

Q10 Chairman: Ian Gibson's question which I thought he was asking originally was: do you have the bottle to lead this debate?

Lord Drayson: Yes.

Q11 Chairman: Right. Thank you very much indeed.

Lord Drayson: It is a bit late now if I have not.

Chairman: Nobody is listening, Minister, so you are all right.

Q12 Ian Stewart: This is very interesting, and it is good to hear the grasp that you have, Minister, of some of these issues. But let me just tell you that when this committee went to China and Japan recently, late last year, and met with the highest level to look at how they deal with encouraging young people into engineering, one of the things that they were very excited about was that "innovation" was in the name of this new department. Now it struck me as quite strange that they were so exercised by this in a positive way, but they were genuinely exercised that the British government had the sense to put the name "innovation" in there. You have given us today quite a clear view of your thinking and your approach to this, but we have a situation where that prioritisation that you are seeking the debate about, with the complications that we have had in discussion earlier about Haldane and all the rest of it, you have a situation where the allocation of resources becomes problematic, because the CBI have reported a downturn in business contribution to research and development. Now should the government therefore be taking up that slack increasingly, and if it does think that it should take up that slack, how are you doing that? And is it sustainable?

Lord Drayson: It is not going to be possible; it is not right either, I do not believe, in circumstances where businesses have taken the decision to cut back on their R&D investment, for the government to step in and replace that, because it is of a qualitatively different nature. I think I have to say quite clearly that I believe it is a mistake for businesses to do that. You are effectively eating your own seed corn if you do that within a business. Businesses can get to the point, I recognise -- I have managed a business through two recessions myself, I know how difficult the pressures can be, and so it may be that individual businesses are under huge amounts of pressure, and therefore, they see that is an area in which they can cut back, but in my experience, businesses have two jobs in a downturn that they really have to do. One is to survive, and two is to really position themselves so they can grow when the upturn comes, and that is why it is very important that that investment is made. What government needs to do is maintain and develop its investment in the science base and innovation to ensure that it is doing everything it can to create an environment whereby those businesses that do make that investment are able to realise the maximum return from it, so that winners can emerge from that, and making sure that the government does not cut back at all on the science budget during the downturn. I am very strongly making the point that it is key to our future success that we maintain our science investment, and that is certainly what I am going to be pushing for.

Q13 Ian Stewart: If you are successful in that argument with business, and get them to increase their contribution towards research and development, would that leave government free to do more in the implementation side, and should government do more in the implementation side?

Lord Drayson: No, I do not think it will have that effect. I think the two are complementary. I think there is a very important role for the government to invest in the private sector research, and the process of innovation, what we have talked about. I think that we need to look at interventions which do a better job of overcoming this bottleneck which we have identified in terms of the size of science based businesses which we develop. The answer to that is in part government procurement policies, because that can have a big impact, so we are making some changes to that, but I think it is really down to business to make the investments that they need and for government to make the investments that it should need in the infrastructure in our universities and in our research.

Q14 Dr Harris: In terms of the radical proposition that you have made, it has further implications, of course you are aware, for other government policy, because one of the things about the current system is that change in universities happens slowly as peer review slowly shifts on the basis of the work and innovation. If you want to have a large shift in funding priorities, you have to plan the workforce in those priorities, to build up one and to run some down. I would like to ask you to agree whether you think that requires some lead-in time, so how quickly do you think this can be done if it is agreed across government; and secondly, does it not mean you cannot leave higher education to a demand led market, you have to say, we are going to need to double the number of biologists, at the expense of these people who want to do these new fangled things that are popular with students but are no good for your vision about what this country needs?

Lord Drayson: We do need to recognise that we have significant shortages in skills, at all levels within science and engineering. That is something which we are seeing as a picture which is not just unique to us but to other Western countries too. We need to do a better job in part of addressing the misperception that exists in young people in terms of the development of a career within science. We see from our public attitudes research that they really like the way science is being taught at school, but they do not see how science is the basis of a good career, whereas on the other hand, the data clearly shows that there is going to be a huge demand in certain of these sectors which I have highlighted for just these sorts of people with very well paid jobs, with really good career progression prospects. So what we do have to do is do a better of job of making sure -- for example, when we look at the climate change area, we have made a legal commitment to reduce carbon emissions by 80 per cent by 2050, we are going to have to go to effectively zero based electricity generation, that is going to require a significant investment in infrastructure, it is going to require a significant demand in the engineers, the scientists that are able to deliver that. We need to be training and developing these people. So, therefore, having the strategic clarity about those areas in which we are going to need that capacity, not being put in a position where by default we have to import that infrastructure, because we do not have it located in the UK, I think you are absolutely right, this is part of the picture. Other government departments too will need to be part of this debate, identifying these areas where --

Q15 Dr Harris: So you will have to tell universities you are not going to fund any more media studies because you want them to recruit, and this will filter through to sixth forms hopefully so they will pick the right subjects, you are going to fund this, you are not going to fund that. Universities are not going to be independent to play the market as they wish because the UK has certain priorities that have to be met and we are funding higher education.

Lord Drayson: Well, we are right at the start of this debate. How do you come up with effective means to get that balance between market demand, how do you ensure that people are motivated to want to choose those areas for which there is the greatest -- at the moment, we have a mismatch, in that people are choosing to learn to do things for which there is not as much demand as there are in others. Is that a lack of information on their part which is leading them to make those decisions? Is there a market failure --

Q16 Dr Harris: It can happen, can it not?

Lord Drayson: It would not be the first time. These are exactly, I think, the questions which we need to answer. We start off by asking the question: do we need to prioritise? What would prioritisation look like? I think it would be actually good for the country to get a clear sense of what it is we think we can lead the world in over the next ten years. I feel really quite optimistic about it. I have mentioned one particular area, I sincerely believe we could be the world's best at life sciences if we really put our minds to it.

Q17 Graham Stringer: You mentioned the commitment of this government, and we assume governments in the future, to reduce carbon dioxide emission by 80 per cent, and I think when this committee has looked at alternative energy sources, while the headline policy has been, "We do not pick winners", when we have looked at it, actually, there are sufficient incentives there for wind power and other alternative energy sources, so that the government are trying to pick winners, and I think with some fairly bizarre consequences. What I would like you to explain to the committee is how, when you look at reducing carbon dioxide, you would choose between investing in a new hydrogen infrastructure, as opposed to having petrol for cars, wind power, tidal power; or whether, when you were arguing in Cabinet, it would not be better if the Chancellor of the Exchequer just said, "We will go for a carbon tax and let the market decide". How will you argue that out? I think it is a very exciting debate.

Lord Drayson: I think that the realities of modern society mean that you cannot leave these things just to the market. As an example, the decisions that need to be made about electricity generation are massively influenced by planning decisions, so therefore, making a decision as to what is going to be the mix of electricity generation sources over the next 50 years has to take into account the realities of the UK geography. From that one would conclude that tidal power, which is something which geographically we are well set up for, is going to be a big piece, offshore wind in part because the nature of the country, it is our weather, but also, and here we can take into account the regional and historical capacity of the country, the fact that we have real strength in marine engineering from our offshore industry, so therefore offshore wind power is likely to be an important element. We are a small country, highly densely populated, therefore onshore wind power is more challenging. So just in that paragraph I have given you a sense of where you would be developing a clear sense of priority, based upon decisions which take into account both the realities of the science of geography, meteorology and our industrial infrastructure.

Q18 Chairman: We are not going to be able to get through our three things, so with the committee's indulgence, I am going to drop thing number one, because thing number two really follows on from this debate. So could I ask you: what changes have taken place to response mode funding formats across research councils and how have these impacted on the research community?

Lord Drayson: We are committed to both forms of funding clearly. There is a trend towards larger project funding, consistently placed over a period of time, and this is something which we expect to continue, in fact something which we encourage. We do think that creating an environment where researchers feel there is this stability over a period of time, where they have a sense that that is an area which is going to be supported, there is going to be a critical mass of funding, leads to effective and efficient research, and that is something which we applaud.

Q19 Chairman: Minister, research under response mode funding, and a great deal of what you have talked about in our earlier session, and indeed in this session, is really about this pull-through, and, if you like, creating wealth from the research base. Yet if you looked at the Russell Group's research that they did in terms of, if you like, the wealth created from basic research rather than transitional research, their evidence indicated there was significantly greater return coming out of blue skies research than anything else, and yet the indication and the direction of travel which we have had earlier in this discussion is that we are going to have greater direction in terms of those areas in which we want to see research take place. Do you not see that there is a sort of problem there?

Lord Drayson: Yes, I do. I think that this is what makes science so fascinating, because science by its very nature is unpredictable. You are dealing at the frontiers of knowledge, there is a serendipity to scientific discoveries which is unpredictable, so therefore, you are faced with the challenge, as you have put your finger on, Chairman, of saying, okay, this is an area -- if you were taking a strategic view that the UK either has a real strength or is an area of strategic importance in the future, so therefore requiring you to be more directive, but at the same time, history tells you that some of the most important breakthroughs come through investment in the blue sky, the pure research, which by its very nature is not directed. So this is why this is really difficult to get right. Nonetheless, I do think it is something which we need to try and do.

Q20 Chairman: But yet the number of first grants which are being awarded are just going down significantly. We looked at EPRC, and you actually look at, yes, larger grants, first time grants, but again, far smaller. If you have got a one in five chance, you are very, very fortunate, and more often than not, it is a one in ten chance. This is driving out the very sorts of people that you say are going to be the people who are going to drive this sort of research excellence in the future.

Lord Drayson: Yes, I think this is a fair point, Chairman. I think that we need to be aware of the way in which the function of the funding available, the demand for that funding, has an effect in terms of success rates, what effect that therefore has on people and the psychology of this, and we need to ask ourselves whether we have got the balance right. This is not a very satisfactory answer, it is an answer which says this is difficult, I think that we need to do more in terms of articulating the balance between the two. It is interesting to me, I was at a university on Friday where there was a real sense that there had been more funding actually into applied research rather than pure research and that this was a general trend that people perceived.

Q21 Chairman: That is the perception, yes.

Lord Drayson: So that is something which I really need to take on board very seriously and follow up.

Q22 Dr Gibson: I just wondered if you thought that the days of Cold Spring Harbor, the molecular biology lab at Cambridge, where there was a concentration of people working together, great success, Nobel Prizes were a measure of that, do you think that has gone forever now, where people are concentrated into certain centres? Because it seems to me that most of the Nobel Prize winning stuff, which does lead to human genome stuff and all that, is done in centres where people are not burdened by having to teach undergraduates, which is kind of shameful in a way, because we were always brought up, you had to teach, administer and do research at the same time. Do you think that has gone forever now, in terms of the kind of person you are trying to produce?

Lord Drayson: I do not think I can generalise on that. I think that there is a real need for these centres where you have a locus of expertise, sometimes interdisciplinary expertise around molecular science, for example, and I think that the challenge of both having a fertile teaching environment as well as research environment is something which is difficult to do, but I do not get a sense that there is a move away from that entirely.

Q23 Dr Gibson: You do not think there is a move away to get post-docs to do the teaching unpaid?

Lord Drayson: That is not something which I have detected. Maybe I will have to look into that a bit, and reflect on what you have said.

Q24 Dr Harris: Can I ask you about your attitude to peer review? Notwithstanding what you have said about changes and possibly taking a more high risk approach, maybe you can look into that, it is said that the peer review technique in funding research leads to less high risk research being funded almost by definition than business would tend to do in its decisions. Do you think there is a need to change the way we do peer review in some of the public funding decisions that are currently done, and if so, do you have any plans as to how that might be done?

Lord Drayson: I think that peer review is the best system we have come up with so far. It is a bit like other things, it is not perfect, but no one has come up with anything better and I think that it has shown over time that it has been effective. I think that the ability of the scientific community amongst itself to make these judgments is the best one, and that is something which I totally support.

Dr Harris: But there are criticisms that it is innately conservative, it is cliquey, and it penalises high risk applications.

Chairman: Allegedly.

Q25 Dr Harris: It is said, and we have had evidence, or submissions.

Lord Drayson: I do not have a better system, I am afraid, Chairman. If anyone has developed a better system than peer review which is accepted within the global scientific community, I do not know of it.

Dr Gibson: You just stick it on a computer, you have open access, because science is always tested, nothing lasts forever anyway in science, people will find out and check it out, if there are claims, so you just open the whole process up. That is a way of doing it.

Q26 Dr Harris: Are you proposing to use peer review in choosing your strategic areas for increased investment?

Lord Drayson: Yes, I think that would be a smart thing to do.

Q27 Ian Stewart: A very short question, Minister: how should the pattern of research funding change in light of the current economic downturn? Should it change?

Lord Drayson: I believe that it is very important that research funding is maintained in this downturn, I think it is vital to our future success as a country that we maintain our investments in science research. That is the policy of government, the Prime Minister has reiterated himself the importance of science as being central to our strategy. My colleague, Lord Mandelson, has himself said that science is the ladder by which we will get out of this economic downturn.

Chairman: I think that is a positive note, with the words of Lord Mandelson ringing in our ears, so it must be right, as we bring this session to an end. Lord Drayson, you have been incredibly generous with your time this afternoon, and have been very, very straight in terms of the questions we have put to you and the answers you have given. We are very grateful to you for that.