Britain must spend billions to bridge gap in research

MPs say sea-change in funding is needed to catch up with global rivals

The UK must spend more than £20bn extra a year on research and development to tackle decades of under-investment, an influential committee of MPs warns today.

The Business, Innovation and Skills Committee wants the Government to commit to a target to lift UK R&D spending to 3 per cent of GDP in five years’ time, to fully capitalise on its science base and close the gap on international rivals by bolstering links between universities and businesses.

According to its report, the UK’s gross spending on research stood at £27bn or just 1.7 per cent of GDP in 2012, far below the £250bn a year or 2.8 per cent spent by the US. France and Germany also invest more than 2 per cent of GDP in R&D every year.

Raising the UK’s R&D spend to 3 per cent by 2020 would mean a £48bn outlay every year given the predicted £1.6trn size of the economy in five years’ time.

Adrian Bailey, chairman of the BIS Committee, said: “In 1979, the UK was one of the most research-intensive economies. Now among advanced industrial economies, it is one of the least. If the UK is going to punch its weight in the global economy, and help businesses succeed in international markets, the Government needs to bridge this structural gap in R&D funding.”

The MPs also called on the Government to protect the science budget in future spending rounds to ensure its economic potential was not “throttled”, as well as implementing the recommendations of the recent review conducted by the technology entrepreneur Hermann Hauser. Among his recommendations was expanding the Government’s so-called Catapult centres – which give businesses and academics access to expensive equipment and laboratories to build prototypes – from the current seven to 30 by 2030, backed by £400m in funding.

The committee said more could be done to improve communication between businesses and universities. Mr Bailey added: “We have a world-class university research and science base but not enough is being done to harness the potential economic benefits of this expertise. Other countries, such as Germany, seem to get more value from their scientific activity than the UK.”

The Government’s technology body, Innovate UK, is overseeing the roll-out of the Catapult centres. Chief executive Iain Gray said: “We need to make sure that all of us avoid the temptation to take a short-term view and invest our time, effort and financial support into something that will have much longer-term benefits.”