The Impact of Spending Cuts on Science and Scienetific Research - Science and Technology Committee Contents

Examination of Witnesses (Questions 246-303)


24 FEBRUARY 2010

  Q246 Chairman: Could I welcome our two witnesses, Lord Drayson, the Minister for Science and Innovation, and David Lammy, the Minister of State for Higher Education and Intellectual Property. Welcome to you both, gentlemen. This is an evidence session on the inquiry into the impact of spending cuts on science and scientific research, and could I emphasise that that is our clear emphasis rather than the whole of higher education, David. We are particularly interested in what is happening to science. Lord Drayson, in your lecture at St Catherine's College, you laid out five major points about the importance of science, particularly in terms of its underpinning the economy as we move forward out of recession, in your speech on 11 February, and you said specifically that "continued investment and a stable framework so that scientists are able to get on with what they do best" was absolutely at the heart of that agenda, and yet we have heard from scientists, certainly last week, and, indeed, from vice chancellors that they are very worried that beyond 2010-11 there is huge uncertainty about where we are going in terms of spending on science. What comfort can you give them?

Lord Drayson: Firstly, I can say that I recognise that that uncertainty is real. I think it reflects the sense that the whole nation feels that we have been through, and are still going through, very tough economic conditions. We are now starting to see a recovery, but that recovery is fragile. This presents the Government with a central challenge, and that challenge is how it can implement policies to reduce the debt burden as we go forward in a way which does not upset the important drive we have to achieve towards growth. Science is absolutely central to the delivery of the achievement of that growth, and so, as we move forward in putting in place the policy responses to that challenge, what we have to do is get that balance right. What we can point to is, firstly, our track record; that this is a government which has fundamentally understood the central importance of science, it has invested in science, but I understand that there is concern and uncertainty. What I can reiterate is my very strong belief, both as Science Minister and as a member of the Government, that it is science and investment in science and innovation which is at the heart of the answer, and so, therefore, that maintenance of investment is going to be key. In the speech that I gave at St Catherine's, what I was aiming to do was to highlight what I saw as two sides to the argument, making the point that, of course, we have to maintain investment in fundamental scientific research. I believe that our track record there, the evidence shows, is excellent, but alongside that what we also have to do is improve our success in seeing the translation of that scientific excellence from pure research through to commercial application to drive jobs and growth. The future for the scientific community is one whereby the nuancing of that balance has got to be got right, and what we have to do is bring the scientific community with us as we discuss the measures which will achieve this. I am sure we will get on to talking about such aspects of impact in terms of making decisions involving research and research grants, but I think these are very important arguments which lie at the heart of getting the balance right between maintaining the drive towards reduction in debt whilst ensuring growth.

  Q247  Chairman: One of the areas that we are struggling with as a Committee, and it came out in a couple of the sessions we have had already, is this report by the Institute of Fiscal Studies which has basically said that if you are going to ring-fence schools and you are going to ring-fence health, then you end up with probably a 10.9-11% reduction elsewhere in terms of spending. There is a concern about how on earth you can maintain the science ring-fence, given that sort of pressure, having said we will protect things in terms of health and education, and yet the very thing which you and your colleagues say will drive our economic growth and take us out of recession are the things that we are not going to protect. How do you protect that against a 10.9% reduction?

  Lord Drayson: Firstly, we are committed to maintaining the science ring-fence; we are committed to maintaining our trajectory on the 10-year framework. What matters is what is inside that science ring-fence in the next spending review. The answer to your question, Chairman, is that, along with my colleagues, I have to make very strong arguments to Treasury and other colleagues as to why investment in science and innovation is key to the answer to driving growth. Of course, that is going to be a discussion which takes place within the decisions that are taken by the Treasury in terms of the future spending round, but I get the sense that there is an understanding of the central importance right from the Prime Minister downwards. Just earlier on in the week the Government hosted a conference for international investors in the United Kingdom, and at that very conference the Prime Minister, Peter Mandelson and other ministers emphasised the strengths that Britain has in science and innovation and made the clear link between investment in science and innovation, the attractiveness of the UK as a place for investment, future UK competitiveness and how competitiveness was a key component of achieving growth. It is a tough argument that has to be made and that argument has to be won.

  Q248  Chairman: It is a popular thing to say that we are going to protect particular areas, but there is clearly a knock-on effect elsewhere. What we did not get from any of the vice chancellors or, indeed, their organisations was any sense of protecting science within the budgets which they allocate through HEFCE, through the dual support system. Indeed, Minister, you do not seem to have made any real statement to say, "I want to see science protected in our universities even if it means something else has got to go." Is that fair?

  Mr Lammy: I do not think that is fair actually. I think the essential statement of government intent in relation to higher education is contained in Higher Ambitions which we published in the autumn. It was a long and extensive consultation that was begun under John Denham. We asked the sector to play a role in setting out the next 10-year vision for the sector, and on page 55 we said, "Investment in science and innovation is not an intellectual luxury for a developed country; it is an economic and social necessity and an indispensable ingredient of economic success." There is no equivocation there.

  Q249  Chairman: No, it is translating those words into some action. That is the key.

  Mr Lammy: Absolutely. At a time where there is belt tightening I would say to the sector, look, obviously there is a political context to this discussion and the political context is, I think, that there are some vice chancellors looking a bit too closely at the polls—perhaps not the recent ones—and anticipating other governments that might do other things and sending out very strong signals about the importance of higher education, but even if you look at the savings that we asked the sector to make in the grant letter that we issued shortly before Christmas, it is clear that HEFCE have sought to minimise the effect on science and research and indeed on teaching, and the lion's share of those savings fall, in fact, on capital. I think our commitment both to the ring-fence, to the 10-year framework, reiterated again in Higher Ambitions, is absolutely clear.

  Q250  Dr Iddon: David, I have been through a period of retraction in the universities as a chemist and I know, because I saw it happening all over the country, admittedly under a previous administration, that when vice chancellors have to save a considerable amount of money on their budgets, the non-classroom subjects in engineering and science suffer the most because those subjects are the most costly to run. The evidence is being seen all over the country at the moment. Leeds is a typical example, where the Chairman of the Russell Group is making quite savage cuts, for example, in the biological sciences department, but that is just one example of many that I could quote around the country. It worries me that science is not being protected in the universities for those reasons. Does it worry you?

  Mr Lammy: I think we have to distinguish between two things, and one of the things that bears on that is autonomy. In the end the Government sets the overall framework, and that is an overall framework in which we have specifically asked HEFCE to do two things, which they are currently doing. They have a pot of money, around about £10 million, to help institutions move from other subjects to STEM areas in this next financial year. So we have a contestable fund, which we also indicated in Higher Ambitions, again encouraging institutions to support STEM. It is not for me to comment on individual institutions, but you will be aware that vice chancellors are also making strategic decisions based on RAE determinations—those, in some senses, predate this next spending cycle—and they are making decisions in relation to where they want to focus their institutions. Let us not conflate decisions that would have been made about particular subjects and institutions that vice chancellors and management teams have to stand behind within this next period. Yes, it is belt tightening, but we are asking the sector do it in a way that minimises the impact on science and research and on teaching.

  Q251  Dr Harris: You mentioned HEFCE was directing universities to concentrate on capital cuts. What do you think is more capital intensive: scientific facilities or English language or humanities facilities?

  Mr Lammy: I do not really like the either/or that you are posing there, Evan.

  Q252  Dr Harris: Let me put it another way then. Which costs more to set up: a science facility or a humanities facility?

  Mr Lammy: Clearly a science facility costs more.

  Q253  Dr Harris: Do you think the capital cuts might fall more on science facilities than humanities facilities?

  Mr Lammy: I think the context is not a year-zero moment, is it? We have invested round about £6.4 billion in capital in the last 10 years. This year we have a capital budget of over £400 million. We have brought forward £250 million from last year as a fiscal stimulus. On any account, when you compare that, say, with the upstream pipeline and the capital budget of zero in FE when we came to power and, I think, roundabout £75 million in HE, we are building on 10 years of serious commitment to capital.

  Q254  Dr Harris: I do not dispute that. I know you start from a much better base than in 1997 in terms of capital investment—I accept that—but going forward I was just trying to establish the question—

  Mr Lammy: It is a different paradigm.

  Q255  Dr Harris: —is it reasonable to say that because you are cutting capital that protects science, from whatever the base (and I accept it is a high base compared to 1997: I just want to make that clear) but I just want to ask you whether you would reflect on whether to say "it is not science, it is capital" is really logical?

  Mr Lammy: No, I think it is reasonable to say that. It is reasonable to say that on the basis of two things: (1) on the basis of 10 years of serious investment in capital and (2) on the basis of the £23 billion income in higher education, £15 billion of that being overall spend from a government or related institution, but the sector has been able to lever in beyond that an extra £7 billion and, of course, let us be clear, universities are also in arrangements with banks and other things to ensure that they can take forward capital again.

  Q256  Dr Harris: I am asking you about the future and you are referring to the past. It is a good record on capital, but let us look at this ring-fence question. Lord Drayson, you said that you are committed to the science ring-fence. I want to ask you two questions: one about what that means in terms of years and, second, what that actually means in terms of what the ring-fence is. First, in terms of years, are you saying that you are committed to what is planned to be in that ring-fenced budget in years 2011-12 and 2012-13, or are you saying you are only giving a commitment to retain what is planned to be in that for 2010-11?

  Lord Drayson: Yes. I think there are two important aspects of the ring-fence. Firstly, what I am saying is that we are committed to the principle of the ring-fence in having a definition of a pot of money which is specifically protected from being spent on other areas as a long-term principle beyond the current spending round. It will not be determined until we get to the budget decision on the future CSR three-year period how much money is in that ring-fence, but I think it is important for the scientific community to recognise that the principle of a ring-fence, independent of how much money is in it, is very important. There has only been one occasion—I think it was in 2007—where money was taken from within the science ring-fence and spent on something outside of the science definition. In addition, it is important that we maintain our commitment to the current CSR and then we argue for the future under CSR of maintaining the investment on the science budget at the current levels going forward. That is an argument to be made and won.

  Q257  Dr Harris: I think I understand you. The principle is that once the money is allocated for that year, it cannot be raided like it was in 2007?

  Lord Drayson: Exactly.

  Q258  Dr Harris: If something is not currently bought by ring-fenced money and then you put that cost pressure into that budget, you apply that budget to that cost pressure currently outside, is that not equivalent to taking money out of the ring-fence to purchase the thing that was currently purchased outside the ring-fence, and do you know of any examples where that has been done recently?

  Lord Drayson: I think it would, in effect, lead to the same cause. I am very focused, as is John Beddington, on monitoring what is in ring-fences, what is on the shopping list, so to speak, and I think I know where you are going with this.

  Dr Harris: I do not want to spring it on you now, but perhaps you might want to write to us in advance of it being sprung to see if you can find any examples of that that will put you on the front foot.

  Q259  Chairman: You are obviously aware of it.

  Lord Drayson: I am very aware of it, and further investigations are taking place.

  Q260  Dr Harris: Let us see if you tell us before I tell you. One last question for the Higher Education Minister. The £600 million planned future cuts are set to be decided after the Browne Review reports. Can you give an assurance—and I know this is hypothetical but I think it is a reasonable question—that if the Browne Review recommends, as it may well do, an increase in the fee that students have to pay, which is money from inside, some of that income will not be lost, effectively, by a withdrawal of government funding, not necessarily on a like-for-like basis, but some of that, because that would not all be new income then to universities? That is what is seen to be implied by linking the £600 million planned cuts to a Browne Review on whether students will pay, through increased debt, higher tuition fees?

  Mr Lammy: I think the £600 million looks across the whole terrain in relation to higher education, funding, research, science. Obviously, it is an independent review. I cannot anticipate what will come out of it and, therefore, it is very difficult to get into hypotheticals.

  Q261  Dr Harris: But if it suggests raising £600 million more from students through higher fees, which is at least a possibility because it is in the terms of reference, would you accept that that fee income would not be extra income to universities because of the £600 planned cuts? In that circumstance, and it is not a difficult sum, I think, you could say that there is no net increase of funding to universities because what students are giving essentially with one hand is being taken way through these savings by the other. Would you accept that mathematic?

  Mr Lammy: I understand where you are trying to direct me. I am indicating extreme reluctance to get into hypotheticals.

  Q262  Dr Harris: Is that really hypothetical?

  Mr Lammy: It is, yes.

  Chairman: I think we have understood the question and we have had a response.

  Q263  Graham Stringer: Can I go back to one question, David? You were saying in answer to whether you could really protect science in universities, universities have autonomy, which they do. Is that not just a straightforward contradiction, and is not the answer that while universities have autonomy you cannot really protect science?

  Mr Lammy: No, I think the Government has to demonstrate leadership.

  Q264  Graham Stringer: I do not want to interrupt, but you said that there are good words in demonstrating support for science; it is a good thing; we want it to be the basis of the future of our economy. We all agree with that on this Committee, but when it comes down to protecting science within universities, while universities are rightly autonomous, is not the answer that you cannot protect them?

  Mr Lammy: Graham, I do not quite think it is like that. I do think that we are, and HEFCE demonstrated that we are, where we are asking for savings to be made, able of course to look right across the area and minimise the impact. For example, HEFCE have made a decision in this recent grant allocation in relation to old and historic buildings. I am a former Heritage minister. I happen to believe that heritage is hugely important, but these are tough decisions, and that is precisely the sort of decision that affects a certain group of universities. That is not as a consequence an impact on science. That is the sort of thing that the Government and the Funding Council can do, but, you are right, universities are autonomous. Vice chancellors must then make decisions about the focus of their institutions, understanding that each institution has a different mission, and, also, they must be able to make determinations, which ministers must not be involved in, about the merits, quality and other assessments about particular departments, and that is taking place at this point in time.

  Q265  Chairman: The short answer is you cannot protect it because your priority is the autonomy of universities and preserving that.

  Mr Lammy: I do not think that is quite how I have put it, no. I have said that we absolutely can lead, we can invest, but then, ultimately, for individual institutions, they must make a determination; but, of course, when this Committee talks about science, we are talking about the collective whole, so we are talking about the sum total of institutions, we are talking about R&D and BIS, a whole range of areas when we are talking about science. We are not talking about what is happening in Leeds.

  Q266  Chairman: I think there is a huge frustration when yourself, the Minister, and, indeed, the Secretary of State, constantly bang the drum about how important science and innovation is to the future of our economy and yet the area where you can make the greatest impact, which is in our higher education system, you are basically saying, "No, no, we cannot touch that. Ultimately it is the vice chancellors that can make these decisions." That just seems to be incredulous to us.

  Mr Lammy: Can I come back? Let us actually look at what is happening. PhDs in science are up; student undergraduates are up in every area of science this year. That is not a context in which we should be alarmist about the prospects for science in our country, surely.

  Q267  Graham Stringer: There are varying achievements. Can I move on to the impact agenda, David? We have had a lot of witnesses who are concerned both about the potential retrospective assessment of impact, particularly HEFCE looking at their Research Excellence Framework and saying that they will try to assess the impact of previous research and weighting that up to 25% in their assessment. Is this not really a false quantification? We all know science impacts on society and it is by and large a good thing, but to try to quantify it and use that as a basis for assessing future research, is that not just false quantification?

  Mr Lammy: I do not think that researchers are being asked to predict their impacts in advance.

  Q268  Graham Stringer: I am coming on to predicting them in the future, because Professor Cox told us they were and you did not know how to do it. I am going to come on to that with Lord Drayson. The Research Excellence Framework: HEFCE are looking, and they are not quite sure how to do it, at assessing the impact of research up to 10, 15, 20 years ago. It just seems a bit strange. I am not sure Max Planck could have done it when he got to the basis of the quantum theory.

  Mr Lammy: Let me tell you my view. I am very clear doing this role that the public do not fully understand the public impact of higher education in this country, and that is indicated every time you see a reference to higher education in a red-top newspaper and in quotation marks you see the word "boffin". We need to do better. We need to convey a much bigger national story about the importance of science and research, about the innovation, say, in the swine vaccine that Imperial were engaged in this year, the technology at Oxford Brookes producing our Formula 1 winning team. We are not able to do that and I think, therefore, that economic, social, public impact is important. If you are hugely committed to the sector, as I am, I actually think if we can get this right it will help alleviate any future concern of withdrawing funds, or whatever. The determination on the "how" must be for the academics themselves, and it is a HEFCE consultation: they must determine the outcome, they must determine the weighting, but the direction of travel is important, to look back and make a determination about what impact particular bits of publicly funded money has generated in our economy.

  Q269  Graham Stringer: Can I ask the question about the future to Lord Drayson? Research councils are asking as part of their assessments of giving grants for scientists to predict what impacts their research will have on research projects of equal value in research terms. That could be a discerning factor. Do you really believe it can be done? Professor Cox told us when he was here that when he was asked to predict future impacts he had absolutely no idea how to carry out that assessment?

  Lord Drayson: Yes, I do, and I am well aware of Brian Cox and others' views on this. I read with interest the transcripts of this Committee's meetings where there is a range of opinions within the scientific community upon this. My sense is that actually the majority of the scientific community do believe this is sensible, do believe that it can be done and are willing to work with both HEFCE and the research councils in the projects which they have to try and do this in an effective way. I think we need to recognise these are pilots, for example, that we are at the early stages of doing this, and so we are sensing our way. There are some people who really do not believe that it is possible for it to be done, and I respect their views. David has already mentioned one reason why it is important to do it. There are two others, I believe. One is making the case for continued investment in science in more difficult economic times. That is going to be the difference between making the case for the science budget going forward and making the science budget case over the past 10 years: it is much tougher economic circumstances. The lack of data on impact which exists at the moment makes it more difficult to make that case effectively within government. The third reason why I believe it is important is that from my own experience of doing research in my own PhD, my own experience as a science entrepreneur, the conversations that I have had with people on this subject, I get a sense there is a real value in asking researchers to think about this issue, not expecting them to implement the impact themselves, not asking all scientists if their research leads to commercial impact for them to become entrepreneurs—of course not—but making the point that this is taxpayers' money; that, therefore, researchers should expect to be part of a process which ensures that taxpayers' money has the biggest impact that it possibly can have for the benefit of the country, whether that is economic, or social, or what have you. Therefore, I believe that these efforts are worthwhile. We are at an early stage of trying to do it; I think we should carry on with it.

  Q270  Graham Stringer: Are we not on dangerous ground here? I understand what you are saying. You have to make your case within government for science and we are in tough times and if you are arguing against health and saving people's lives, or whatever, you have to make a case, but are you not going to get into conflict with just pure curiosity-driven research? When I think back to the classic cases in science, whether it is Rutherford or Max Planck, people have made huge impacts on society with the research that they did. I do not believe that they could have answered these questions when they were doing that research. Do you, and are you, in effect, moving away from curiosity-driven research to applied research?

  Lord Drayson: Absolutely not. I think that if you read the biographies of those individuals about what was going on at the time around their laboratories, for example, you get the impression that there was no doubt at the time that the work that they were doing was going to have massive impact. Therefore, if they had been asked to give some consideration to what the impact might be of their research, I do not think they would have had much trouble in doing it.

  Q271  Chairman: Not when they started though. You are asking them to do this when they are starting the work.

  Lord Drayson: You are asking people to give some consideration to this as part of the overall assessment of a research project in the same way that we are starting to ask them to take consideration of the communication of science. This is another theme which we believe is important and which we need to provide the incentives for people to do. We are not saying that this is the main way that we are going to judge research. In fact, in the case of the research councils, the idea of asking for this consideration of impact is to enable the peer review panels in a dead heat, a tie, between decisions, between grants, where the overriding criterion for making that decision is research excellence, and if they have come to the conclusion that those grants are equivalent in terms of excellence that there is a further differentiating factor which can be looked at. Sincerely, I really believe with my 20 years' experience in science as a science entrepreneur that this has value. I really do believe it can be done. You hesitate to characterise a scientist in the company of the Maxwells and Plancks and so forth, but, I think, if we look at it, there have been enough really seriously eminent living scientists who have said, "It is fair enough for us to be asked to do this; it is early days; let's see", to suggest that this is worth doing. I think that there the concern that I have said I recognise is all to do with a general concern: is there a shift away from pure towards applied? Absolutely not. What we need to do is make sure we continue being excellent and pure, but we need to get a bit better at the application of applied research, and so I do not think that this impact agenda should be seen as a part of any kind of intention by the Government to shift allocation of research funding between that pure and applied spectrum, but I do believe it has huge potential benefit and should be followed.

  Q272  Dr Iddon: Lord Drayson, words like "prioritisation" and phrases like "strategic choices" are now being used more commonly in your speeches, and I think David has used "prioritisation" as well. In the Nairne Lecture the other day you stressed a focus on space, the digital economy and life sciences. Does that mean there is going to be a shift of money from other areas into those favoured areas and, if so, who is going to make the choices about those shifts of money and will it not damage some areas like particle physics?

  Lord Drayson: The fundamental thinking behind all of this relates not just to scientific research but it relates to the central question of the economic future of Britain and the Government's plan to ensure that Britain has a prosperous and successful future in the context of the difficult economic circumstances in the near term but also very strong global international competition, and that has been pursued through a strategy, described as "industrial activism" by Peter Mandelson, whereby the Government has worked to identify with industry and the academic community those areas where Britain has real clear strengths, where the markets in those areas are growing strongly and where, therefore, if Britain invests in those areas, both on the supply and the demand side, it is most likely that Britain will succeed in generating future economic growth. You mentioned space. Space is a classic example. It is as if the recession did not happen in the space industry. It has been growing at 9% a year for the last 10 years or so, it is projected to grow at 5% a year globally for the next 20 years, an opportunity for Britain to increase its global market share to 10%, create 100,000 new jobs, but to do that investment has to be made to maintain the fundamental science, first of all—just the sort of things that Professor Brian Cox would be keen on—but at the same time to make sure that that is translated into success in the economy, which means making sure of that translation of that science into projects. The best example I would give of success in doing this is Surrey Satellites. Out of one of our leading universities, a world lead that we have now in small satellites, Surrey Satellites just having won a major contract for the supply of the Galileo System. 500 million, I think, is the number, half of which will be coming to the UK, so there is a clear policy here. What that means, though, is that both the academic community, industry and government need to work together in the example of space, the innovation and growth team, to come up with a plan and a plan that the academic community supports. Therefore, it is the role of the academic community, through peer review, through the research councils, under the Haldane Principle, having been asked to think by the Government of what these priorities should be, for them to provide that advice. It is not for ministers to tell the scientific community these are the areas, because it is for the scientific community to come up with the conclusions.

  Q273  Dr Iddon: I think all members of this Committee would agree with what you have said, but if we are going to put more emphasis on all of what you have said, does that not mean that something down the line somewhere has got to give, because it is a limited budget?

  Lord Drayson: Absolutely; choices have to be made

  Q274  Dr Iddon: Is there not a danger that some of our fundamental aspects of science are going to suffer? I have mentioned particle physics; I could mention nuclear physics as well. I was at Manchester a few days ago and the nuclear physicists, at a time when we are developing the nuclear industry in this country, are suffering quite badly across the country at the moment.

  Lord Drayson: I believe there are two dimensions of this. One is the dimension from pure fundamental research to the most applied research, and then there is the dimension of the field of research. What I have been talking about really is the fields of research. What are those fields where Britain has real critical mass, it has real leadership in, where the science is moving at a pace which is part of a big shift which leads to a big market opportunity? It is not a question of whether or not you make a short-term or a long-term decision. Pure research, by its nature, has a long-term impact, but it can be absolutely fundamental to success in an area of real importance. I do not make this link that some are making that if you are concerned to ensure success in these areas of strategic importance that that necessitates a shift from pure research to applied research: you have to do both. I think we have got to improve our success of translating our applied research to economic growth. We have made a lot of progress but we need to go further.

  Q275  Dr Iddon: Let me turn now, Lord Drayson, to the STFC. Are you able to tell the Committee when your work with Professor Sterling will be completed?

  Lord Drayson: Very shortly. I have received in the last few days proposals from Professor Sterling, as a result of the work that he has done with the Research Council in response to my asking for this review. I am now reflecting on the proposals that he has given, talking to colleagues across government, and will be making a decision very shortly.

  Q276  Dr Iddon: There is a feeling in the community represented by STFC that when CCLRC and PPARC came together that that was probably a mistake. Is it possible that there might be some more restructuring of the STFC?

  Lord Drayson: I recognise that the creation of STFC has led to a situation where, because of the very nature of STFC as a research council which has a larger proportion of its funding being spent on large international facilities, costed not in sterling, where Britain is an important but a minority partner, the creation of this structure through the merger has meant that pressures which are not within the control of the Research Council, like exchange rate risk, changes that are decided by the majority of other countries to increase costs, leads to pressure on the grant-giving side of the Research Council. I have said that I accept that that is a problem. The purpose of the review is to come up with solutions to that problem. I am optimistic we can come up with solutions to this.

  Q277  Dr Iddon: The astronomy community and the nuclear physics community, in particular, but others as well, feel they have no clout within the STFC, they have no say on the council of the STFC and they are now being marginalised. We are talking about some pretty important areas of fundamental research. Do you feel that we should in some way try to protect those areas like nuclear physics and astronomy that are being marginalised at the moment?

  Lord Drayson: I hear what you are saying about the concerns that that community has. There have been a number of communications to me and to other ministerial colleagues about the concerns within the STFC community and we are listening to those very carefully. As part of the review we are not just looking at the structural elements of the organisation of STFC but we are listening to the community. I can say that I absolutely recognise the fundamental importance and excitement in those areas. I have a child who is particularly keen on astronomy, and so I am well aware of the importance of astronomy, not just in terms of the answers it gives to some very fundamental questions in science, but also its power in terms of enthusing and motivating young people to study science.

  Q278  Dr Harris: I wanted to ask the Higher Education Minister what your view is of the health of physics in higher education at the moment.

  Mr Lammy: I obviously see it through the lens particularly of entrants. I am pleased that we have seen a 3% rise in students taking physics, which sits alongside the increases in all the other STEM subjects.

  Q279  Dr Harris: What is the baseline for that rise?

  Mr Lammy: It is a year-on-year rise because of investment.

  Q280  Dr Harris: So if there were a 6% fall in a previous year, would that give you pause to say that maybe picking your baseline to create the rise is not necessarily the most statistically appropriate thing to do?

  Mr Lammy: No, because this Committee in previous incarnations would, quite rightly, have been concerned about a fall of 19% in chemistry, a fall of 7% in maths and physics struggling as well.

  Q281  Dr Harris: Between when and when?

  Mr Lammy: This is going back to the 1999-2000 period. We are now seeing progress. We are also seeing progress in Masters courses, which I think is very important, and PhD levels. In terms of the appetite, partly because of the capital conversation that we had previously, the investment in facilities and a whole range of activity, that feels to me to be a healthier environment.

  Q282  Dr Harris: Do you think the astronomy and particle physics community in higher education, particularly those funded by STFC, are happy with their lot at the moment, or do you think that it is fair to say that there is a problem there, if not a crisis?

  Mr Lammy: I recognise what Lord Drayson has just said. I too see some of the concern that has been raised.

  Q283  Dr Harris: Lord Drayson, in respect of partnerships that we have in this area, for example with Wellcome over the Diamond Light Source, do you think as a matter of principle that if you do a partnership deal to create a large capital facility, then it should be a first call on government resources to live up to the obligations to then fund the recurrent running costs of that facility, otherwise you are not maximising your return on the investment and you also could be perceived as letting down the people you entered into a partnership with because you are pulling the plug on your share of the running costs? Do you see that that is a reasonable thing to be a high priority first call?

  Lord Drayson: I do accept the point that you are making that the partnership depends upon an understanding of the principles by which the long-term nature of funding decisions on those facilities would be made and, in particular, not just the capital funding for the facility in the first place, but the ongoing development work and the allocation of funding to be able to ensure that those facilities are maximised. I think your question referred to the difficulties that STFC has faced with the pressure which is being caused, as I have already said, and we do need to address that and we are looking at that aspect in the review that we are taking. To actually commit today to a prioritisation, I am not in position to do, but I accept the point.

  Q284  Dr Harris: My final question is to ask whether you have any concerns, whether you have heard of any concerns over the cost of setting up the shared services centre by RCUK?

  Lord Drayson: Yes, I have heard about those concerns.

  Q285  Dr Harris: What is your take on that?

  Lord Drayson: Like all aspects of the administration of science, we need to be alive to making sure that those are done as effectively and as efficiently as possible, and I think that is one of the areas that we will need to put increased attention into as we go forward.

  Chairman: We will leave that hanging in the air.

  Q286  Mr Boswell: A quick question to the Higher Education Minister. Given the pressures we know there are across the higher education sector, some of which have been announced and others of which are to follow, not specific to STEM, and given also the acknowledged improvement or beginning of an uptake in STEM enrolments, does the Minister have anything to say about any anticipated safeguarding of STEM subjects and whether he will be talking to the Browne Review? One has a suspicion that Lord Browne may have an interest in STEM subjects as well. Would he give us a take on whether, at the end of this process, I think the welcome improvement which we have seen will be maintained or will be reversed if not in absolute possibly in relative terms as well?

  Mr Lammy: We have already indicated in Higher Ambitions and HEFCE already are implementing a £10 million pot to ensure that universities are able, in a sense, to safeguard and move to STEM to continue to see the improvement that we have seen since the introduction of the framework, and the figures that I gave previously are as a result, if you like, of the introduction of the framework. We are already saying to the sector that we are making some funds contestable to also see a shift to the New Industries, the New Jobs agenda, and STEM obviously lies behind that. Of course, the review is independent of government and we will reflect on it as it comes to us, but I know and would expect that certainly our more research-intensive universities will have made the case that you are outlining.

  Q287  Mr Boswell: Beyond that, in relation to graduates and career entrants into STEM subjects, will the Minister also be taking a lively interest in the fact that this is not simply a matter of undergraduate recruitment, but it is a need to get people trained to be the scientists of the future?

  Mr Lammy: I think that is a very good point. We have seen a huge increase at Masters level. We must ensure that we are seeing a good proportion of UK postgraduate students. I think Adrian Smith's postgraduate review is very, very important in relation to this and, clearly, we have to build on what the CBI outlined at the end of last year. We do need to see more sandwich courses in the sector, we do need to see continued increases in employer co-funding, and I think the whole sector understands that the proximity to industry and the commercialisation of science must be the key to growth in the sector.

  Q288  Ian Stewart: Paul, can it be taken from your answers this morning that you are comfortable with these cuts and comfortable with the consequences that they will bring about?

  Lord Drayson: No, I would not say that as Science Minister I am comfortable; quite the opposite. My role is to argue very strongly for investment in science. I think that we have to be very clear that the £600 million that has been looked at as an efficiency saving is off a figure which has not been determined yet, and so, therefore, my lack of comfort is due to the fact that I am arguing very strongly for the figure for the overall future research budget. I think it is important to be absolutely clear on that. The PBR figure, the £600 million efficiency saving in 2012-13—people talk about a percentage. You cannot calculate a percentage because you do not know what the CSR numbers are yet. The argument is still to be made and won.

  Q289  Ian Stewart: The motive for the question was to seek what you have just said, because I have also had difficulty trying to work it out. David, higher education, of which our Chairman is a great advocate, has received massive investment since 1997. Can you say whether these cuts will undo that good work? Will it, for example, force some universities to decrease their UK recruitment for indigenous students and perhaps go for more students from overseas? Will they damage the good work?

  Mr Lammy: I think we have got to put this in perspective. We saw a decline in the unit of resource, Ian, as you will remember, on new UK figures of 40% between 1991 and 1997. What we are effectively talking about is a less than 5% saving, and within that 5% I think the real argument is about how we minimise the effect on science and research, and I would include teaching within that. That is the endeavour. I certainly do not recognise some of the alarmist statements that have been made.

  Q290  Ian Stewart: Do you not accept that some of the more far-reaching statements that may be made are born out of complete uncertainty, not about the current proposals, but whether there may be further cuts to come after the General Election?

  Mr Lammy: Yes, as I indicated earlier, I think that there are some vice chancellors who are clearly very worried about the prospect of a Conservative administration and there are other vice chancellors, very, very unusually, confusing their understanding of ancient history, because I did not quite understand the 800 years statement that had been made.

  Q291  Ian Stewart: Can I move to the more positive side? Some of our witnesses have asked for help from government. For example, a number of them have said it would be really good if the Government could do something about VAT. Have you articulated that to the Treasury and what progress has been made if you have articulated it?

  Mr Lammy: That point has been made. We are looking at it, but I think it is right to say that there is quite a lot that can be done in terms of shared back-office operations and we need to encourage the sector to make those advances because some of the impediment looks to be in competition actually and I want to indicate that where the last 10 years have been very competitive, this next period has to be collaborative. You will understand, Ian, that we are obviously discussing these things within the Treasury. Progress is usually determined by a Budget.

  Q292  Ian Stewart: Do we know if it will be in the Budget?

  Mr Lammy: I cannot anticipate what the Budget might be.

  Q293  Ian Stewart: Can I move to my final point? We know, in line with what Paul Drayson said and what you have said, David, as Higher Education Minister, that hard decisions need to be made, but in an attempt to move things forward positively you have implemented the 10,000 additional student initiative and one of our witnesses, Professor Adrian Smith, has said that this was a fairly hastily contrived move and we thought that was an interesting statement, to say the least. Can you tell us about where the idea came from and what consultation you undertook before announcing it, and is Adrian Smith correct?

  Mr Lammy: I think all of last year you will have seen a particular group of universities particularly (and I know that you have had Les Ebdon before you and he described the move as tremendous) generating quite a lot of noise in the system last year, asking for extra places, so I think there was quite a long process by which government was able to hear and listen, to look at a pattern of figures. We were in the height of the recession and we sought to ameliorate that with just the 10,000.

  Q294  Ian Stewart: David, can I interrupt there. Professor Ebdon, in the balance, also called the actions on student support money a "betrayal". It appears to me, hearing the different statements from witnesses, including yourself, that there is a sweet and sour situation here. How is the university sector going to get any stability for planning, which is the key issue for the future?

  Mr Lammy: If you look at successive years, actually there has always been unfunded growth in and around the system. There was the year before this one and before that.

  Q295  Chairman: 10,000 places.

  Mr Lammy: It may not have been as much as that but we were in the height of the recession last year. We had a decision to make, we made it and I think it is a good thing that those young people are effectively in universities in new areas of the economy.

  Q296  Ian Stewart: What will happen if universities have to say to applicant students, "No, there is no place for you"? Is that not contradictory to what all the Government strategy has been?

  Mr Lammy: There will be more young people at university next year than ever before in our history. University is a competitive process. It has never been the case in this country or any other country that everyone who wanted to go in their first-try application went, and that will be the same this year, as it has been in all of our history.

  Q297  Ian Stewart: Is that growth sustainable in the light of these cuts?

  Mr Lammy: Absolutely. It has to be managed growth, and that is what we are indicating. For every place around 40% of students are in receipt of some grant; so it is managed growth. We have always been clear about that.

  Chairman: You have taken 10,000 places out this year. You put them in last year and you have taken them out this year. That is not managed growth.

  Q298  Dr Harris: That is negative growth.

  Mr Lammy: When I talk about managed growth, I talk about the costs associated with each student place. We made a determination in the height of the recession last year. I think it was the right determination. We will still see growth this year but, of course, it is not the growth that we would have anticipated before we came into this difficult period.

  Chairman: Okay.

  Q299  Dr Naysmith: Lord Drayson, Professor Brian Cox told the Committee that "it is accepted clearly in the Obama administration that the way to do it"—and this is the sort of thing we have been talking about this morning—"is to expand the frontiers of human knowledge and thereby we derive the benefits". You yourself said earlier this morning that investment is key to driving growth. At the bottom of all we have been talking about this morning there is a clear strategic choice: do we as a country increase investment in science, and that is the punch line, or do we try and squeeze a few more drops out of what we have got and hope for the best?

  Lord Drayson: I think that the Obama administration has truly followed what this administration has been doing for a number of years. If you look at the previous administration, the Bush administration certainly did not see science in the centre of its policy. So there has been a transformation, Professor Cox is absolutely right, in the United States that is hugely welcome, but here in the United Kingdom, under both Prime Minister Blair and Prime Minister Brown, there has been a sustained focus, a transformation in science. That is something which should be maintained. In good times or bad this country's future depends upon it being a science leader. Our health, our wealth and our prosperity depends upon us making the best use of this leadership which we have in science. It is astonishing, I think. We are the most productive nation in science in the G8. We have more Nobel Prize winners than any other country apart from the United States, and so we have something very special that takes place here in the United Kingdom. That has been hard fought after a really quite shocking underinvestment by the previous Conservative administration. That has been put right now. We need to maintain that in the future.

  Q300  Dr Naysmith: Are there going to be cuts or not? Are there going to be serious cuts that will affect science funding?

  Lord Drayson: What I can say to the Committee is that I am arguing very strongly for the investment in science and innovation, but I can also point to public comments that have been made by the Prime Minister and that have been made by Peter Mandelson many, many times over the past 18 months.

  Q301  Dr Naysmith: You said that earlier and you said that from the Prime Minister down everyone was persuaded by the importance of science, yet you are still arguing for future investment. Who you are arguing with?

  Lord Drayson: The decisions have yet to be made. We are waiting for decisions coming out of the Budget to be made which will then affect future spending rounds. That is the normal business of government.

  Q302  Dr Naysmith: What kind of steps are you taking to try and ensure that the rest of the Government will agree with you and increase our investment in science?

  Lord Drayson: Firstly, we are showing that we are putting as much effort as possible into ensuring the efficiency of everything we do. The point that you make about the shared services problem is an example that we have to show to Treasury and other colleagues that we are putting significant effort into making sure that we are maximising the efficiency of everything that we are doing in the areas for which we are responsible. The fact that we are the most productive in the G8 shows that we are already doing something very special, but we must not be complacent. Also we need to develop a public consensus of the central importance of science to growth, about the importance of scientific literacy generally but also making sure that the talent which we have in this country is properly stretched, exploited and its potential turned into economic jobs and growth. All of these things we are doing and we can point to a pretty effective track record. A number of people have said in some of the debates which we have had, on which Evan has shared a platform, and the Chairman is well aware of the fact, that in this run-up to an Election science is central to what this nation is about and it is being discussed in a way which it never has been before, so truly in this Election we have achieved an important goal which is to make science a central part of the choice that voters make. Do you really believe that science is going to be central to this country's growth? This Government has a clear strategy, a clear plan for doing so. The Opposition have said there are going to be very major cuts in science; I do not agree with that, I do not believe there should be very major cuts in science.

  Q303  Dr Harris: That is the official Opposition.

  Lord Drayson: The official Opposition of course.

  Ian Stewart: There only is one official Opposition.

  Chairman: On that very, very positive note of agreement, could we thank you very much indeed, Lord Drayson and David Lammy, for your time with us this morning.

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