Investing in the future of innovation


It continues to be a testing time for the UK economy, so focusing on areas that encourage industrial growth is vital. Investment into research and development (R&D) is essential for creating inroads into the technological innovation that will help initiate positive growth. Investment will ensure the UK remains competitive with dynamic economies such as India and China. Industry, academia and government each play a role in making this growth happen. Currently, however, the impact industry, academia and government is having on each other is proving more inhibitive than progressive. What is needed is a more cohesive approach that results in innovation, growth and subsequently prosperity says IET president, Andy Hopper CBE


UK industries in the engineering and technology sectors play a large part in helping the economy to grow. In February, Lord Browne, Chair of the Queen Elizabeth Prize for Engineering Foundation reported that engineering contributed to 21% of the country’s GDP.

Currently, however, UK businesses are spending very little on R&D which could help in furthering this contribution. The UK R&D Landscape report by Alan Hughes and Andrea Mina, from the Centre for Business and Research at the University of Cambridge, highlighted that as of 2009, the UK spent only 1.2 per cent of its GDP on R&D efforts.  This was comparatively less than other global competitors such as Japan (which spent 3.2 per cent), Germany (2.8 per cent), and USA (2.8 per cent). Combined with the report’s findings that over 40 per cent of UK R&D was conducted by foreign firms, this further highlights that there has been a substantial decline in efforts towards innovation resulting in a less positive effect on the UK economy. Industry, particularly in the engineering and technology sectors, need to consider increasing spend on R&D in a bid to rectify this problem and enhance innovation.

The same report highlighted that there had been a substantial drop in R&D in higher education in the UK over the last ten years. This is in stark contrast to the likes of Germany which have benefited from the largest upsurge in higher education R&D within this same period. The UK is failing to keep up with global competitors and as such, more is needed to consolidate this relationship between industry and academia as it will in turn benefit innovation.

The barriers between industry and university need to be lowered. Over the past decade the UK has slowly moved from a low barrier, low cost (revolving door) model to a high barrier, high cost (turnstile) one, which has made it extremely difficult for universities and industry to work together. The high cost of university research and the current culture within universities of selling their intellectual property to companies means they are no longer working together effectively.

This conflict of interest has put universities and industry in a difficult position; On the one hand, universities can help the growth agenda through the vast amounts of intellectual property which will prove helpful to growing businesses. In an age where universities are faced with high targets, high fees and lack of funding, this can restrict the level of goodwill that universities may experience.

Universities need to make publically funded intellectual property available to applicable industries at no extra cost. This will generate goodwill and interaction with companies and result in more research contracts for universities, to the benefit of all.

This mutually beneficial relationship however can only progress forward successfully, if government plays its part by subsidising research. Providing this financial incentive to universities will remove current financial barriers for industry, giving smaller UK businesses the financial freedom to use this research to explore new routes to innovation.

Realising the positive impact that engineering and technology can have on the economy, the government has started to place more attention in these areas over the last two years. The 2011 Autumn Statement unveiled plans to spend £5bn on infrastructure which would help encourage innovation and growth.  This spending has already begun with work on the A45, M1 and Tyne and Wear Metro which started this year. While investment is an essential way to achieve this, there are other options which will help ensure that this funding is spent in a way that will have long lasting effects across the UK.

The first suggestion on how to do this effectively is not a new idea - the creation of a Chief Engineering and Technology Advisor position within government. This individual would sit alongside, and be equal to, the Chief Scientific Advisor, and would effectively be a Chief Technology Officer for UK plc. advising the government of new ways to help with growth.

The US administration has already benefited from such a position when it appointed Aneesh Chopra in 2009 as its first CTO to the White House. Replacing Chopra in March 2012, current CTO Todd Park has already made positive and significant strides, particularly in changing the way American citizens interact with technology and data. Through key US initiatives such as The Presidential Innovation Fellows programme and the Digital Government Strategy, Park aims to bring together innovators from outside the government and the best innovators inside government to create agile teams that aim to deliver game-changing solutions in the US.

The UK government needs to take a lead from such action, but also remove current inhibitors that limit innovation. The Prime Minister needs to appoint an engineer to sit alongside his other cabinet members to take the decisions on levels of investment to help increase innovation. The ever changing fiscal tax policy in the UK also inhibits innovation as it makes it extremely difficult for companies to grow and plan for the future. Stabilising policy will give companies more freedom to explore new technologies which could help them innovate.
By working together cohesively and understanding how each can help the other, government, industry and academia can all make sufficient changes to help enhance innovation in the UK. An increase in R&D by industry, more openness of intellectual property by the universities and most importantly, changes in government policy will help create a more mutually beneficial relationship between the three. This will in turn ensure the UK remains competitive in terms of opportunity and innovation compared to other nations.