Second Special report: Response to Scotland’s Space Sector inquiry
On 22 June 2023, our predecessor Committee opened an inquiry into Scotland’s space sector. The Committee concluded its evidence-taking but was unable to formally report its findings due to the dissolution of Parliament following the announcement of a General Election on 24 May 2024. The then-Chair of the Scottish Affairs Committee—Pete Wishart MP—wrote to the outgoing Secretary of State for Scotland and the Minister of State for the Department for Science, Innovation and Technology on 24 May 2024 with a summation of the Committee’s findings. The current Government responded to these findings on 12 March 2025. A copy of this response is appended to this report. While our predecessor Committee’s correspondence was not itself a committee report, we are publishing the Government’s response to the correspondence in the form of a special report in the interests of accessibility and transparency.
Aspects of our predecessor Committee’s inquiry have been continued with our current inquiry into Scotland’s space sector follow-up: launch.
Appendix: Government response
Letter from Ian Murray MP, Secretary of State for Scotland, Scotland Office and Lord Vallance, Minister of State for Science, Research and Innovation, Department for Science, Innovation and Technology, dated 12 March 2025
We would like to thank the Scottish Affairs Committee for its inquiry into both Science and Scotland and Space sector in Scotland concluded last year and for your letter setting out some key recommendations as a result of this work. Your letters cover a broad range of issues, responsibility for which falls between the Scotland Office and the Department for Science, Innovation and Technology and we are responding on behalf of the UK Government.
The UK Government is committed to working collaboratively with the Scottish Government to harness growth and create high-skilled jobs in the science and space sectors. The UK Government is working extensively to support and promote science, innovation and the space industry in Scotland. Scotland plays a leading role in both sectors, with significant strengths to be proud of. To point to just a few examples, Scotland proudly hosts SaxaVord spaceport, a rich and diverse life sciences sector, as well as some of the UK’s highest performing, historic universities and four Catapult sites.
Scotland is also home to pioneering innovation centres focusing on semiconductor research and development with The University of Glasgow being at the forefront of research and commercialisation through the James Watt Nanofabrication Centre, one of the UK’s leading facilities in nanofabrication, enhancing semiconductor design and production capabilities in partnership with industry. The University also hosts the UK hub for quantum-enabled position, navigation and timing, building on its strengths in photonic technologies.
In partnership with Scotland’s Chief Scientist Office, the Office for Life Sciences awarded further funding to seven technologies to prevent drug overdose deaths. The UK Government is committed to supporting life sciences business in Scotland through the Life Sciences Innovative Manufacturing Fund, which is open for applications UK-wide. NHS Scotland’s Safe Havens, facilitated by Research Data Scotland, provides a federated network of secure data environments. These Safe Havens are bound by a Charter of agreed principles and standards that enable the secure use of health data for research and development whilst protecting patient privacy. Continuing to ensure the success of these institutions will be critical for delivering the UK Government’s Plan for Change and achieve our mission of delivering economic growth across all parts of the UK.
Since last year’s general election, the Prime Minister has been leading a profound reset of relations with the Devolved Governments, with a renewed focus on collaboration and delivery for citizens across the four nations. As part of this, both DSIT and the Scotland Office are committed to harnessing Scotland’s scientific, technological and innovative potential for the benefit of people across the UK. That is why we have taken early action, such as extending the Innovation Accelerator Pilot in the Glasgow City Region.
Please find attached to this letter responses to Science and Scotland Annex A and Scotland’s space sector Annex B, in turn, to the 24th May letter from your predecessor, the Honourable Member for Perth and Kinross-shire, Pete Wishart MP, to our own ministerial predecessors. We look forward to working with you and the new Committee members, supporting Scotland collaboratively to drive growth and opportunity across Scotland’s science and space sectors.
Yours sincerely,
Rt Hon Ian Murray MP, Secretary of State for Scotland
Lord Vallance, Minister of State, Department for Science, Innovation and Technology
Government response
Ambition and action
Despite the hugely exciting progress we have seen across Scotland’s space sector, we are concerned that there may be limited public awareness (both in the UK and internationally) of the sector’s success and potential. It is critically important to raise the profile of Scotland’s space sector. This will be necessary, not just to attract the domestic and foreign investment that the sector needs to grow, but also to secure public buy-in for government support to the sector. We believe that the UK and Scottish Governments need to reinforce two messages in particular. First, space must not be seen as a discrete sector narrowly defined by rockets and astronauts, but as an environment with relevance to every aspect of our daily lives. We have heard about the potential for space to transform the delivery of public services. The UK and Scottish Governments must be clear that space capability is key to future growth, sustainability and wellbeing. Second, it is vital for the public to understand that failure in the space sector need not be a bad thing. The Civil Aviation Authority told us that, for new operators entering the market since 2000, the failure rate of first launches by new operators is around 90%. While the failure of the Virgin Orbit launch from Cornwall to achieve orbit was obviously disappointing, the sector learns from such failures, and they are part of the journey toward success in future. The UK Space Agency should set out how it intends to develop public understanding of this fact, particularly as Scotland draws ever closer to achieving launch capability.
The government agrees with the Committee on the importance of raising the profile of the Scottish space sector. We know that Scotland is key to driving the success of the UK’s growing space sector.
The latest Size and Health of the UK Space Industry report estimates that 228 space organisations in Scotland generated a combined income of £298 million in 2021/22, almost double the amount for 2016/17 in real terms (£164 million).
Almost half (49%) of space jobs exist outside of London and the South-East, including 12% in Scotland.
The government also agrees that space is not just about rockets and astronauts: space has transformed significantly in strategic importance over the last decade – it has rapidly expanded into a vital economic, commercial, and security domain, highly integrated into modern life.
In terms of raising Scotland’s profile, the UK Space Agency (UKSA) has hosted a range of events, engagements and activities in Scotland, alongside the opening of its new Edinburgh office, as part of its commitment to be at the heart of the space sector in Scotland.
The Agency hosted Space Propulsion 2024 alongside the European Space Agency (ESA) in Glasgow in May 2024, as well as supporting the inaugural Space-Comm Expo in Glasgow.
At Space-Comm Expo, the UKSA had valuable engagement with the Scottish space sector through its stand presence, an industry roundtable, and gave support to the event organisers to help them deliver an impactful conference with a broad range of speakers.
Following this success, UKSA is looking forward to supporting the next event in Glasgow on 3–4 December 2025. Additionally, it hosted its first Ignite Space event in Edinburgh in November 2021, which supported entrepreneurs and SMEs at an early stage to catalyse commercial success and innovation.
In 2024, the Agency held its first Space Investment Forum in Scotland. This forum exists to connect investors with the increasingly exciting and innovative market, accelerating growth and catalysing investment into the UK space sector.
The Space Investment Forum brings innovators seeking investment face-to-face with investors looking to participate in this sector. The forum provides the perfect opportunity for participants to learn from, and network with, each other.
At the end of February in Glasgow, the CEO of the UKSA, Paul Bate, will be speaking at the second Ireland-Scotland bi-lateral meeting to navigate ways to grow the space economy. We know that launch is inherently risky, and unfortunately, success cannot be guaranteed, as seen recently with SpaceX’s Starship test flight. However, the benefits of having this capability outweigh the risk, promoting research, development, and innovation. Each launch conducted demonstrates the UK’s ability to do this safely, and we are committed to supporting launch companies as they develop the required vehicles and infrastructure to achieve the Government’s ambition in this area.
Both in the run up to and after the Virgin Orbit launch from Spaceport Cornwall, the UKSA highlighted that a successful launch is never guaranteed. Ahead of future launches from Scotland, the Agency will work closely with launch operators and spaceports to highlight the inherent risks of early launches.
Launch
We call on the UK Government to ensure that developing a sustainable pipeline of launch customers is central to this approach. In particular, we were struck by the observation in the University of Strathclyde’s submission that “development of a national, sustained space launch capability without a sustained government customer is, probably, unprecedented”. The UK Space Agency should therefore commit to working with both the UK and Scottish Governments to identify early public sector customers for Scotland’s launch and spaceport sector. Government becoming a customer of the Scottish launch sector would send a clear demand signal that the sector is viable, and encourage the development of a more diverse customer base in the coming years. We also call on the Department for Business and Trade to explain how it will work to promote international demand for Scottish launch services.
The UK government is committed to supporting the Scottish space sector and enabling a UK launch capability that delivers growth, benefitting communities in Scotland and across the country. This will help us to achieve our ambition to become a leading provider of small satellite launch in Europe.
There may be national interest in a UK launch capability in terms of the potential for defence and security uses in the future. For instance, NATO has recently launched the multinational High Visibility Programme STARLIFT, aimed at enhancing NATO’s responsive launch capabilities through a network of government-owned and commercial space capabilities. This initiative supports the UK’s NATO-first defence strategy and will promote our space infrastructure, enabling allies to launch from UK spaceports.
We are working closely with launch operators and spaceports to monitor their plans for launch and have recently provided a £20 million investment to Orbex to enable the company’s first launch from SaxaVord Spaceport. We will continue to consider how the UK government can best support the sector and promote international demand.
Supporting the sector to grow
It is clear that there is a gap in matching the right government customer to the right space service provider, and we believe that the UK Space Agency can play a greater role in closing this gap. We urge the UK Space Agency to co-ordinate demand for space services across government, identify potential UK providers of these services, and provide targeted support and guidance to both sides in navigating procurement processes. This role must be made central to delivering the UK Space Agency’s missions of maximising UK space sector growth and championing the power of space. As an example of how this could be achieved, we urge the UK Space Agency to use its new Edinburgh office in Queen Elizabeth House as a “front of house” for multiple potential UK Government customers of Scottish space services, supporting both sides to make these connections. We also call on the UK Space Agency and Scottish Government to work together in understanding and meeting the Scottish Government’s own needs for space services.
More broadly, we agree with Space Scotland that there is a need to review and improve the mechanisms by which companies are encouraged to scale-up, including ensuring that infrastructure is in place, and considering whether current mechanisms are sufficiently targeted enough for the space sector. We urge the UK Space Agency to work with the Scottish Government to conduct this review.
In order to champion our space sector, we are committed to working collaboratively with the Scottish government and industry stakeholders to grow the Scottish ecosystem.
Following on from the introductory strategic workshop last year, in March 2025, we will hold a bi-lateral Scotland/UKSA facilitated strategy forum which will not only help to focus discussion on key themes such as Launch, Investment, Sustainability, Telecommunications, Business Support, ESA and Space Applications, but will also collaboratively and inclusively set a road map for the years ahead.
On 6 May, the UKSA will host the Space Scotland quarterly workshop at its Edinburgh offices and proactively engage with Scottish Government Space Group stakeholders where these challenges are discussed.
As evidenced by the Smiths of Dundee space cluster infrastructure fund project, we are aware of the positive impact derived from funding space infrastructure to establish facilities, drive business growth, develop supply chains and patented technology, catalyse investment and attract companies from worldwide to access this technology. The UKSA is leading the Unlocking Space programme that has a focus on championing the benefits of space to different stakeholder groups to catalyse investment and support the long-term growth of the UK space sector.
As part of this programme, the UK Space Agency is delivering the Unlocking Space for Government project which aims to increase public sector adoption of satellite data and services through convening public sector stakeholders to understand their requirements, aggregate demand and improve procurement processes. The programme has led user-led design workshops bringing together different public bodies around shared uses cases or thematic areas such as healthcare or transport infrastructure. The UK Space Agency will use these workshops to develop detailed specifications for these uses, cases that can be translated into coordinated commercial opportunities and to design interventions that remove blockers and accelerate the pathway bridging potential government end-users to space sector suppliers.
Unlocking Space for Government has also delivered GovBridge, a 3-month programme designed to demystify the Government procurement process and help space companies refine their business offering to better suit the UK government’s requirements. GovBridge has educated space businesses about how the government procurement process works, and how companies can set themselves up for success within this process. The learning materials and outputs from the course will be made openly available to the wider sector.
The Unlocking Space for Government project has also, in collaboration with NI Space and the Department of Agriculture, Environment and Rural Affairs (DAERA), awarded three companies Small Business Research Initiative (Contracts for Innovation) contracts worth £360,000 collectively to develop satellite technology and data that could be used to improve the detection and monitoring of blue green algae in Lough Neagh.
The project will harness satellite, space-based and remote sensing technologies, alongside aquatic applications, to observe and predict blue green algae blooms, which will help to inform the development of strategic initiatives to protect the Lough and other waterways across Northern Ireland. As suggested by the report, subject to future funding, there may be further opportunities to support the regional uptake of space data and services as part of the Unlocking Space for Government project.
Skills and the space workforce
We encourage the UK Space Agency to work with industry and with Skills Development Scotland to carry out a mapping exercise of the specific key skills challenges facing the space sector, to inform a set of targeted interventions. One particular challenge we would highlight is around business skills such as marketing and finance, with EcoOnline’s Sarah Middlemiss telling us that there is a lack of “people who know how to scale a business”.
DSIT and UKSA published the findings of the 2023 Space Sector Skills Survey in September 2023 on gov.uk, openly available to all. This emphasised the importance of growing a strong UK skill base on AI and data, software engineering, systems engineering and wider technical roles, as well as the need to develop highly specialised space capability in the workforce.
The Space Sector Skills Survey 2023 provides a comprehensive mapping of the current recruitment and retention challenges facing the UK space sector. Acknowledging that regional challenges and issues do exist, the UK Space Agency already engages locally through the established cluster network to deliver targeted skills interventions. As part of the current Ecosystem Development Program, Space Scotland is delivering a series of projects that focus on workforce development and includes funding for a range of both short-term and long-term measures. We encourage Skills Development Scotland (SDS) to collaborate with Space Scotland to maximise the impact of this UKSA funded project. Outputs thus far from this project include:
- Development and delivery of a hands-on programme that allowed school students from remote and underrepresented communities to build their own miniature AmbaSat satellite.
- Delivery of a Rocketry Academy Course for graduates, providing sought after hands-on engineering skills not provided by academic curricula.
- A white paper identifying potential future training pipelines and skills needs for Scotland.
DSIT and UKSA accept this recommendation from the Committee and have reached out to SDS to share the findings of this survey. The UKSA operates the national UK Space Agency Accelerator that supports early-stage space businesses, giving them the tools and opportunities they need to drive their own success wherever they are based in the UK.
The UK Space Agency should form a new partnership with academia and industry to deliver a package of development programmes for the space sector, including apprenticeships through colleges and universities, and CPD schemes for those already in the sector. This package should also include support for re-skilling of personnel from other industries, to help space compete with more mature sectors.
The UKSA has committed £19.6 million to education, engagement and workforce projects since 2022, including:
- Funding 125 summer internships placements aimed at university students (where historically around 70% of participants go on to jobs in the space sector).
- Funding 5 new space training programmes, including one in Edinburgh, designed to meet the highest priority gaps identified in the 2023 Space Sector Skills Survey.
- Funding 15 local community engagement projects, including one in Glasgow, to reach underrepresented communities.
- Funding enrichment and engagement initiatives aimed at using space as a context for learning for schools, teachers and students (e.g. teacher training, learning resources, competitions, careers activities and engagement with role models and employers through the Space Inspirations STEM Ambassador programme in underrepresented communities.
The UKRI has also delivered a range of STEM skills support, including a £3.9 million SENSE Centre for Doctoral Training, training 70 PhD students in satellite imagery.
The Level 6 Space Systems Engineering Apprenticeship was officially launched by the Department for Education in July 2023, joining the existing Level 4 Space Technician apprenticeship.
Following the Autumn budget in October, further detail on future allocations within DSIT and its arms’ length bodies will be decided in due course. This will include consideration of funding for the UK Space Agency’s Education and Future Workforce programme and the actions it may seek to take in future years. Spending allocation outcomes and the overall implications for the future programme will be communicated to the sector at the earliest opportunity.
We are aware of concerns that foreign investments in the Scottish space sector have sometimes resulted in the displacement of existing jobs, rather than the creation of new ones. It is essential that foreign investment in Scotland contributes to the growth of the domestic sector. We encourage the UK Space Agency to share the results of its skills mapping exercise with Scottish Development International, so that the UK and Scottish Governments can work together to ensure alignment between skills planning and investment strategy.
Recent challenges experienced by the sector in terms of inward investment, sourced by Scottish Development International pertaining to new manufacturers may have resulted in some displacement of existing jobs and generated criticism of the policy. Future attraction of investment must be considered in a wider context of the space supply chain, not just looking at specific space product manufacture, but more in the component supply chain and in the development of products and services in the space data downstream and analysis.
Scotland is strong in downstream capability and is already seeking new sectors who could be best placed to use the data. The Department of Business and Trade (DBT) and the UKSA have been supporting Scottish companies and SDI through various international initiatives including Space Tech Bremen and Global Space Technology Convention and Exhibition in Singapore). The ongoing negotiation by DBT of free trade agreements and especially on digital trade (e.g. UK-Singapore Digital Economy Agreement) will ease the use and transfer of this data between markets. Future work identified by the skills mapping exercise and close working with domestic enterprise and skills agencies will assist in addressing the shortage of skilled personnel.
The UKSA agrees to share the findings of its skills mapping exercise with Scottish Development International.
To inspire as many young people as possible into space, government, academia and industry must work together to communicate the full range of careers that are possible. This will be particularly critical for improving the diversity of the space workforce. To unlock the Scottish space sector’s full potential, it is imperative that no group feels that space is inherently ‘not for them’. We urge the UK Space Agency to set out how it will ensure that its space outreach activities achieve sustained engagement with young people that communicates the full range of possibilities in the space sector.
Between 2022 and 2025, the Inspiration Programme has so far achieved:
13m Interaction Hours (this does not account for 2025 Q4 so expected to be significantly higher).
- 125 UK wide Internship Placements (over 5000 students applied).
- 15 regional community projects, including 1 in Scotland, funded (£1m overall).
- 25 regional science centres funded to deliver “Our World From Space” (6 in Scotland).
- So far over 4,500 delegates participated in 5 new training programmes funded (1 in Scotland).
The above statistics on interactions highlight the sheer reach of the UKSA’s Inspiration programme to all audiences, including those in Scotland.
Following the Autumn budget in October, further detail on allocations within DSIT and its arms’ length bodies will be decided in due course. This will include consideration of funding for the UK Space Agency’s Education and Future Workforce programme and the actions it may seek to take in future years. Spending allocation outcomes and the overall implications for the future programme will be communicated to the sector at the earliest opportunity.