Decline in R&D spending 'threatens defence jobs'

Substantial increases in funding for defence and aerospace research programmes are essential or Britain will lose jobs and its competitive edge, a Government taskforce has warned.

Substantial increases in funding for defence and aerospace research programmes are essential or Britain will lose jobs and its competitive edge, a Government taskforce has warned.

A report from the Department of Trade and Industry's Foresight Directorate, calls on the Government to reverse the long run decline in R&D budgets for defence and civil aerospace.

It also recommends scrapping the 50:50 rule whereby the Government will only provide funds for R&D projects provided it is matched by upfront investment from industry. The report says that this deters small and medium-sized companies from undertaking R&D work.

Smaller companies could be further helped, it adds, by the use of commercial off-the-shelf equipment in defence programmes and the development of dual-use technology, which could be applied to both civil and military products.

The report has been compiled by the Foresight Directorate's defence, aerospace and systems panel, which is chaired by Sir Donald Spiers, the chairman of Meggitt. The panel says it is of "significant concern" that support from the UK Government for the defence and aerospace industries has continued to decline on a yearly basis. "Without such a reversal it is inevitable that in the fullness of time this will lead to the loss of high quality jobs across the manufacturing base of the industries as knowledge capability is grown by international companies in bases other than the UK simply because the conditions to do so are more favourable than those provided by Government," the report says.

The panel says it is a "regrettable fact" that UK R&D funding fell by some 35 per cent in real terms between 1976 and 1996 while in Europe the budget spent by Nato nations on defence research is $10bn compared with $36bn in the US.

"In the view of the Foresight Panel, the UK needs to reinvigorate its research base if future competitiveness is to be assured. In terms of UK research spending what clearly needs to be understood is that the technology now embedded in the UK's world class defence and aerospace products is based on research from 15 or 20 years ago."

Future threats to national security, apart from biological and nuclear attack, include "cyber crime" which will require the development of increasingly sophisticated defence systems and software.

The panel's hard-hitting report is being issued as a consultation document to industry, research organisations, the Ministry of Defence and associated agencies. The aim is to produce a final report for presentation to the Cabinet in November.