UK research spending at new low

BRITAIN'S SPENDING on research and development fell in real terms for the fourth year in a row in 1997, official figures yesterday show. As a share of output, R&D spending dropped to 1.8 per cent, the lowest recorded and well below the average for other leading economies: the same figure is 2.3 per cent in France and Germany, 2.6 per cent in the US and 3 per cent in Japan. The Budget pre-announced a new R&D tax credit for small companies.

R&D in 1997 funded by business accounted for pounds 7.25bn of the pounds 14.65bn total, and rose by 4 per cent in real terms on the previous year. Direct government-funded R&D was pounds 2.33bn, diving by 7 per cent in real terms.