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Lord Crickhowell: I should be grateful if the noble Baroness could help me on one specific point. I am not very good at interpreting the legal jargon of Bills, and I have cast my way around this Bill. I keep hearing the statement that there are other parts of the Bill. I simply have not been able to identify them. If there is going to be this change of policy, I want to know where it appears and to what extent action is possible under it to deal with the problem to which I am referring. I simply have not been able to identify it so far, and reading everything that has been said about the Bill, I am as confused about it as I was when I began.

Baroness Ramsay of Cartvale: But what will not be dealt with under parts of the Bill are the objectives of NESTA. That is a negative answer, but I can certainly tell the noble Lord what is not there. When we come to Amendment No. 39 and that part of the Bill I hope that this discussion can continue there.

It is fair to say that the proposals for NESTA have been among the most widely welcomed of all the proposals of our White Paper. Nine out of 10 of the people who responded commenting on NESTA supported its establishment. The proposals which are now embodied in the Bill have been the subject of lengthy discussion and consultation outside and inside the Government, both before and since the general election. The response to NESTA has been overwhelmingly enthusiastic. I was pleased to hear that the noble Lord, Lord Skidelsky, also gives his support to the concept of NESTA.

The reason why NESTA has so captured people's enthusiasm is that it is perceived that there is a major and damaging gap in our national life which NESTA will fill. Britain is a country full of talent, ideas, innovation and creativity. As well as a source of national pride, this surely represents a real economic as well as a cultural value. Many of the jobs of the future will depend upon creativity. If we are to make the most of the advantages of the creativity of the British people, we must ensure that we support and nurture that creativity.

Britain has too often failed to provide this support in the past. Too many of our talented young artists and musicians have found the way barred to them. Too many of our inventions have been exploited overseas because financial support could not be found to develop them here. Too many of our scientists have left to pursue their pioneering work in foreign laboratories. NESTA's primary object is,

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It will do so by helping talented individuals reach their full potential, and by helping turn good ideas and innovations into marketable products and services at the cutting edge of technology where financial support is often hard to come by. In these ways, NESTA will help the most talented people in our country to give of their best.

The first of the amendments of the noble Lord, Lord Skidelsky, would remove NESTA's focus on,

    "helping talented individuals reach their full potential".

Instead, it suggests that NESTA should help,

    "develop talent and achievements".

On the face of it I would agree that this does not perhaps seem a significant difference but in practice we believe that the amendment is drawn far too wide. Developing talent and achievement is not the same as talented people reaching their full potential. The amendment seems to be aimed at a wider group of people, including those whose talents are not yet apparent or even noticeable.

It is not a primary objective of NESTA to improve general access and involvement in science, technology and the arts, however laudable these aims are. The Government support many other programmes and projects designed to promote exactly such access, but NESTA's concern is with the brightest talents whose gifts might otherwise be diluted, squandered or just not developed. The wider NESTA's focus, the less support it would in practice be able to deliver to those with the greatest potential. The Government, therefore, support the original wording, rather than the noble Lord's amendment.

The means by which NESTA is to achieve its objects, which are set out in Clause 15(2), include:

    "(c) contributing to public knowledge and appreciation of science, technology and the arts".

We see this particular means as supporting NESTA's primary objectives--promoting talent and helping develop ideas. Ensuring public appreciation of the role of creativity will help to secure public support for NESTA's activities, but we do not expect NESTA to spend as much time and money on general public awareness activities as on its primary objectives. We are therefore considering whether we need to make it clear in Clause 15(1) that the public appreciation object in paragraph (b) is subservient to the main object at paragraph (a). If we consider that this needs to be made much more explicit, we will seek to return to this issue on Report.

The noble Lord's second amendment would remove altogether NESTA's capacity to support the development of new goods and services. At the cutting edge of innovation, it is often difficult to bring ideas to the marketplace. The noble Lord, Lord Skidelsky, said he had often heard this, but he was not convinced. However, venture capital often fights shy of creative genius and all its attendant risks. The clear market failure places the UK at an economic disadvantage, and has done so until now, and it leaves others--notably the United States and Japan--to exploit and capitalise upon what was, very often, British creativity. The Japanese Government have estimated that 57 per cent. of major technological innovations which have benefited the Japanese economy

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stemmed from ideas or inventions from the United Kingdom. I know those figures are often quoted--at least, I have read them a great deal recently--but they are nonetheless telling for the fact that they have been reiterated. If one reflects on what that means, it surely makes an unanswerable case about the fact that something needs to be done to help British creativity be exploited in its own country.

We need to do something to address this failure and to ensure that most of the benefit of British innovation, talent and ideas is reaped here and not overseas. The noble Lord's amendment would, we believe, move this major plank of NESTA's activities. That is one of its activities that has been warmly commended by so many people who have been working in exactly those fields.

I hope that the noble Lord will, on reflection, agree with the central purpose and means we have set out for NESTA. I appreciate that at the beginning of his remarks he joined in welcoming the creation of NESTA and the fact that it was endowed by the National Lottery, but I hope that in the light of all this he will withdraw his amendment.

4.30 p.m.

Lord Chorley: Before the noble Lord withdraws his amendment or otherwise, I wonder whether I could ask a question in order to try to understand a little better how this will work. I am not sure whether I am addressing myself to the amendment to subsection (2)(a) or the amendment to subsection (2)(b). But what happens in the case of an individual who works for a company--he may even own the company--which is trying to establish a new technology that it eventually wants to market? Will NESTA be able to give help to that individual? If the property rights--that is, the benefit of the invention--accrue to the company, does that preclude the individual from getting help from NESTA? Can the noble Baroness give me some guidance?

Baroness Ramsay of Cartvale: I am not sure whether I can be of complete guidance to the noble Lord, but it seems to me that it would depend very much on what agreement the individual had with his company. I do not know whether it helps to say that "persons", as used here, also includes companies. However, on the specific point of a person working for a company and applying for something that is his idea, it would depend on the relationship and the agreement between him and the company as to whether it could be treated as his personal idea or the company's. I may have misunderstood the question.

Lord Chorley: I do not want to prolong the discussion but subsection (2)(a) refers to "individuals"; I do not think that an individual can be a company. I can see that "persons" in subsection (2)(b) can be a company. Perhaps the noble Baroness will write to me in due course, but it will help tease out the scope.

Baroness Ramsay of Cartvale: Yes, of course, I shall be happy to write to the noble Lord. However, the point is that "individuals" in subsection (2)(a) does mean one or a few individuals, but "persons" in subsection (2)(b) also includes companies.

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Lord Skidelsky: The Minister's reply has given us some indication of the difficulties of this subsection. That is why we are seeking to tighten it. For example, the provision in subsection (2)(a), which states,

    "helping talented individuals in the fields of science, technology and the arts to achieve their potential",

seems to me to reflect a rather romantic view of the artist--the talented individual starving in the garret, and NESTA comes to his rescue. The trouble is that NESTA is the national endowment of science, technology and the arts. Unless it was purely for the convenience of the acronym that led to science and technology being put first, that has no relation to innovation in sciences and technology. These are team efforts, and creativity is a collective thing. They are laboratories, they are experiments, they are groups of people.

The word "individuals" just gives the wrong emphasis to the whole thing. It suggests that the Government have the idea of the starving artist as their paradigm. That is surely not the message that NESTA wants to be sent out, especially when coupled with the Minister's sad reflections on how inventions keep going abroad, are exploited by others and so forth, and that NESTA is designed to stop this happening. I suggest that wording does not relate to the objectives of NESTA centrally, as either stated by the Minister or in any of the notes we have had. That is why we want to change it. We may not have come across quite the right wording, but surely we have to find some way of getting "individuals" out of the central position, and making the provision more relevant to the needs of British science and technology, if indeed they are of the types that have been described.

The idea that our economy has lost a war over the past century because the British genius has not found expression in British industry and because owners are too stupid and banks too shortsighted--"Will Huttonism" one might call this--the Government have bought hook, line and sinker. It is totally unprovable. There may be something in it, there may not, but I am interested in the mechanics of the process.

I asked a number of questions. Is NESTA supposed to enter into competition with banks in lending innovators money? Is its judgment supposed to supersede commercial judgment about the value of the products? If so, at the end of that do the losses fall to the taxpayer or to other National Lottery causes? We do not believe that NESTA should be set up to be a commercial organisation. I know the noble Baroness said this was a subsidiary aim and not the main aim, but there it is, and we believe that it should not be. That should not be the aim because only trouble will lie along that route.

I would beg the Government to take what we are saying seriously, not respond automatically, and do something to tidy up this subsection. It is going to land NESTA in trouble, and we are seeking to avoid that trouble.

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