CORRECTED TRANSCRIPT OF ORAL EVIDENCE To be
published as HC 490-ii
House of COMMONS
MINUTES OF EVIDENCE
TAKEN BEFORE
SCIENCE AND TECHNOLOGY COMMITTEE
OST SCRUTINY 2005
Wednesday 25 January 2006
LORD SAINSBURY OF TURVILLE
Evidence heard in Public Questions 32 - 73
USE OF THE TRANSCRIPT
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Oral Evidence
Taken before the
Science and Technology Committee
on Wednesday 25
January 2006
Members present
Mr Phil Willis, in the Chair
Adam Afriyie
Mr Robert Flello
Dr Evan Harris
Dr Brian Iddon
Margaret Moran
Mr Brooks Newmark
________________
Witness: Lord Sainsbury of Turville, a Member of
the House of Lords, Parliamentary Under Secretary of State, Science and
Innovation, Department of Trade and Industry, gave evidence.
Q32 Chairman: Can I welcome you, Lord Sainsbury, to the
Committee once again and may I make the point of thanking you very much for
extending your time with us, it is much appreciated, and we do appreciate what
efforts you put into supporting science and technology. Could I also welcome amongst our visitors
today students from Cardinal Newman School in Luton. You are particularly welcome and we hope you will enjoy meeting
the Minister and listening to some of the questions which he will answer in his
elegant way over the next 40 minutes.
Minister, what role is the Office of Science and Technology playing in
the current Energy Review?
Lord Sainsbury of Turville: OST is contributing to the Review in a number
of ways, focusing in particular on energy research and innovation aspects. For example, members of the Council for
Science and Technology, co-chaired by Sir David King, last year published an important
report on energy and they will be meeting with Malcolm Wicks tomorrow to
discuss how the committee can assist.
In addition, the new public/private sector Energy Research Partnership,
again co-chaired by Sir David King, will, at its launch meeting later today,
consider, for the head of the review team, areas where it can contribute. OST officials are also assisting engagement
with the science and engineering communities.
Q33 Chairman: You mentioned Sir David King a number of
times then and clearly he is playing a significant role. How much weight do you put on his advice in
terms of this Energy Review and particularly his comments about nuclear
power? Is he speaking for the
Department?
Lord Sainsbury of Turville: Well, it is always important to understand
that chief scientific advisers play, I think, a very independent role and I
think that is a very healthy position.
They do not, in that context, speak for the Government necessarily. I think it is very important in terms of
their public credibility that they are seen to be independent, so I think the
answer to your question is that we put a great deal of weight on his views
because I think he is a very distinguished and really excellent scientist, but,
on the other hand, he is not speaking for the Government.
Q34 Chairman: When the Energy Minister says that our
treatment, for instance, of nuclear waste over the last 20/30 years is a public
disgrace and that only eight per cent of the 2.3 million cubic metres of waste
is actively being dealt with, do you think it is credible for the Chief Scientific
Adviser then to be openly saying that we need another X number of nuclear
reactors in order to meet our power needs before the Energy Review has even
taken place?
Lord Sainsbury of Turville: If that is his view, then I think he is
entitled to take that view. Equally, I
think the Energy Review will have to consider, as a very key part of its
report, whether the waste issue and the safety issues are such that it would
not be right to go ahead with nuclear energy.
Those are clearly two issues that need to be solved, and the Prime
Minister has made it very clear that those issues have to be solved, before we
could go ahead with nuclear energy.
Q35 Chairman: But in terms of actually where OST puts its
resources or encourages the research councils to put their resources, how much
additional effort is being made to deal with that issue particularly of dealing
with waste?
Lord Sainsbury of Turville: Well, I think it should be said that, if you
look at the spread of energy resources, they cover all these issues and we are
putting very substantial resources into both renewable areas and into areas to
do with nuclear waste, safety and clear-up, so I do not think there is any bias
in those areas. If there is a problem,
there was a tremendous fall in energy research both by the private sector and
the public sector over the late 1980s/early 1990s and I think perhaps we may
have taken too long to correct that, but we are now correcting it and putting
more money into energy research.
Q36 Mr Newmark: We are still curious as to why the Government
is approaching the Health & Safety Executive now and will the
implementation of the Energy Review's recommendations be conditional on the
findings of the Health & Safety Executive?
Lord Sainsbury of Turville: I think it should be clear what we are
asking. What we are asking the Health
& Safety Executive to look at is the processes, particularly the processes
involved in pre-licensing, so that we have an understanding of that as part of the
Energy Review. Of course there is no
way that any of this could go ahead unless the nuclear safety issue was dealt
with and we had confirmation that not only nuclear safety in general, but
particular designs were safe in this process.
Q37 Mr Newmark: I am rather curious because I know that a
number of environmental campaigners in particular are concerned that this is
just merely a process and that it has already been decided that nuclear is
going ahead. Can you give us some
thoughts as to why their concerns should be alleviated that the nuclear option
effectively is not necessarily a fait
accompli?
Lord Sainsbury of Turville: Well, as I said, the Prime Minister has
always made it absolutely clear that, unless the safety and waste issues are
dealt with, this will not go ahead.
Q38 Mr Newmark: Given the rising levels of CO2
emissions from transport, is the Government prepared to put more funding into
R&D in such areas as fuel cell technology and biofuels?
Lord Sainsbury of Turville: I think the point of the Energy Review is
just this: that it is a review and I think, whether it is nuclear or what money
one puts into energy efficiency, one should not prejudge the Review, but one
should look at what comes out of that Review and then, on the basis of that, go
forward. As I said, I think we still
have a lot of work to do to make certain that we are putting enough money into
energy research and putting it into the right places. That is why David King is now chairing this Energy Research
Partnership because this is both a private sector and a public sector issue.
Q39 Mr Newmark: But you have not really answered my question
directly which has to do with transportation.
Transportation is at the moment viewed still as a major problem with
pollution and, specifically on that, do you yourself have any particular views
as to the need to be focusing on alternatives such as, as I said, fuel cell
technology and biofuels?
Lord Sainsbury of Turville: Well, can I just go back one step. I do think there is a tendency always to see
this issue in terms of electricity generation and people tend to focus on that
issue solely. Of course if you are
going to deal with the CO2 emissions, you have got to deal also with
the whole issue of transport, so I think hopefully there will be more focus on
transport in the future as well as electricity generation. If you are going to focus on transport, then
obviously issues like hydrogen become very much more important.
Q40 Mr Newmark: One of the biggest challenges that we seem to
face is that, whilst there do seem to be some strides at least into achieving
certain goals with auto transport, one of the big challenges actually is to do
with air transport and, regarding air transport, there is a report, I think it
is the Air Transport White Paper, forecasting that by 2030 CO2
emissions from UK aviation could amount to a quarter, 25 per cent, of the UK's
total contribution to global warming, so I am curious again, is there any focus
on that particular area because that seems to be a major challenge today?
Lord Sainsbury of Turville: Well, I can only repeat what I said which is
that I think transport is a much bigger part of this than sometimes it is given
credit for and, therefore, doing actions to do with this is very
important. I should say that there is now
a lot of research going on in the aerospace industry, quite a large part of it
supported by the Technology Strategy which is about finding or developing the
environmentally friendly engine for planes in the future.
Q41 Chairman: Just before we leave this section, you have
talked about the Health & Safety Executive review feeding into the Energy
Review. The Energy Review, according to
Malcolm Wicks, is going to be completed by this summer, yet the HSE review in
18 months' time is due to report, so how can that feed into that Review to be
effective for this summer?
Lord Sainsbury of Turville: I need to look exactly at the issue
here. I think what has been looked at
is simply the processes of pre-licensing, what the processes are which are
involved in that. I may have been
mistaken in saying that that would feed into the Energy Review itself, but
clearly it is sensible to get on with looking at the question of what kind of
processes you might have in that.
Q42 Chairman: There is a major concern for us, Lord
Sainsbury, that the Energy Minister has made clear that by this summer there
will be a set of proposals being put to the Government in terms of our future
energy policy. The Prime Minister and
yourself have clearly said that the issues of dealing with waste in particular
and safety are crucial, yet the Health & Safety Executive are not going to
report for 18 months, so I do not understand those timescales and how one can
inform the other.
Lord Sainsbury of Turville: Well, I think the Prime Minister has also,
and we have always, made it absolutely clear that, if the Energy Review took
the view that nuclear should be or ought to be looked at as part of our energy
mix, there would still be a further process which would probably be a White
Paper on the question of nuclear and that would obviously have to involve
issues like safety.
Q43 Chairman: Moving on to question 2, are you satisfied
with the operation of current safeguards against the publication of misleading
research?
Lord Sainsbury of Turville: In 1998 the Director General of Research
Councils and the Research Council Chief Executive issued clear guidance on good
practice which aims to ensure that misconduct is not tolerated. This places the principal responsibility for
monitoring misconduct with the institution in which the researchers are based. Institutions must have procedures in place
in line with this guidance and must investigate and report any cases of
misconduct. An average of two or three
allegations of misconduct a year have been reported to the research councils
over the last ten years. These have
been investigated according to the established research council procedures and
appropriate action taken where justified.
There appears to be no upward trend, but RCUK have been reviewing the
measures in place. Commercial
publishers are of course responsible for the accuracy of the material they
publish.
Q44 Dr Iddon: Do you think there really is a need for a
mandatory ethical code for scientists to be published?
Lord Sainsbury of Turville: I think it is something worth looking at and
the Council of Science and Technology have issued a document which the OST will
be looking at. This is called Rigour, Respect and Responsibility. I think that is important in general terms,
but I think the point I hope to make in my first answer is that I think the
place to look at first is whether there appears to be a problem or not in what
is actually going on. As far as I can
see, there is no upward trend. There
were a rather small number of allegations, and what I mentioned were
allegations, not proven cases. To be
quite honest, when one talks about scientific misconduct, there are only two
issues: one is fabrication and falsification of data; and the other is
plagiarism. I do not think there has to
be a great deal of clarification of what is involved in these. In most cases it must be very clear to the
perpetrators that they are falsifying or fabricating data or indeed
plagiarising. However, I think we
should look more closely at the particular allegations which have been made and
see if there is any misunderstanding which needs to be clarified to scientists.
Q45 Dr Iddon: In your answer, you put the onus on institutions,
but can I put it to you that most scientists are members also of professional
societies and most professional societies already have a code of conduct for
their members. How do you see the
institutions' role playing against the role of the professional societies to
whom scientists might belong? In any
case, we could make it mandatory for an academic to belong to his or her
professional society.
Lord Sainsbury of Turville: Well, I think the position taken by the
Director General of the Research Councils and the Research Council Chief
Executive is the easiest way to do it, which is to put the responsibility on
the institutions and, given that the system seems to work very well, I do not
think there is any need to add anything to it.
Indeed, the people on the spot are more likely to pick up and understand
the issues involved.
Q46 Dr Iddon: How can we stop ghost-writing which is a
phenomenon largely used by the pharmaceutical industry?
Lord Sainsbury of Turville: I think it is a rather difficult issue. I think this might be a case where
clarification of the ethics of this should be established. I do not know what the ethical situation is
or what code of conduct there is which covers this, but that might be a case
where further ethical clarification was needed, and obviously that would be a
Department of Health responsibility, I think.
Q47 Dr Iddon: Do you think we are putting too much pressure
on our academics these days by way of the research assessment exercise
concentrating more and more research in fewer and fewer universities and,
thereby, academics feel that they have to produce at the cutting edge in order
to stay in the institutions in which they are working presently?
Lord Sainsbury of Turville: Obviously you can make a lot of ethical
issues go away if you say to people, "You don't have to perform to very high
standards in terms of scientific productivity", but obviously that has implications
for scientific productivity. It is like
the issue as to whether you encourage scientists to do work with industry, and
obviously, if you do that, there is a bit more pressure on ethical
standards. I think the way to do it is
to require high standards of quality and scientific productivity, but make it
very clear what the general issues of rigour and responsibility are.
Q48 Dr Iddon: Regarding industry, I have two
questions. Firstly, do you think we
should make it mandatory for the name of sponsors to be published in a paper,
the people who have sponsored the work, so that we know if there is any
industrial affiliation which has led to that work being published? Secondly, should we not be worried about
industrial sponsors, particularly in the light of what has happened with the drug,
Actonel, in Sheffield where obviously the amount of money coming into that
university has obviously put a lot of pressure on that university and has led
to a difficulty in Sheffield of which I hope you are aware.
Lord Sainsbury of Turville: I am afraid I am not aware of that particular
case. Again I think the issues to start
with are whether we see any problems existing and, if there was any sort of
upward trend or situation where there appeared to be more instances of misconduct,
then one needs to look at whether one should take action to deal with this,
but, as I say, from the figures we have, there appears to be no change in this
position. Obviously if there appears to
be a new set of problems occurring, we ought to look at it and see what should
be done.
Q49 Dr Harris: You are aware of the Wakefield study on MMR
in The Lancet and the controversy
around that and we have got a series of questions around that. Firstly, do you think there is a concern
that a rush to publish controversial information leads potentially to the
short-circuiting or the shortcutting of peer review? Secondly, do you think that The
Lancet in that case, after the revelations came to light and it completed its
investigation in five days and came to a judgment and only some time later was
the article partially withdrawn by part of the authorship, do you consider that
to be a satisfactory way of dealing with it or should we have a much more
rigorous way of looking into these sorts of cases when the stakes are so high?
Lord Sainsbury of Turville: I feel very strongly, because of a number of
incidents, that actually insisting that people do not publish things until they
have been properly peer reviewed is extremely important and it is a message we
need to make very clearly again. There
will always be people who say, "Well, the information is so important that we
must get it into the public arena", but I think this is a very dangerous
attitude because, if it then turns out that the research is wrong or has been
misinterpreted, that is a very serious situation.
Q50 Dr Harris: Because the more controversial the research
is, arguably the greater the scrutiny that needs to apply, not the less.
Lord Sainsbury of Turville: That would be entirely the view I would take.
Q51 Dr Harris: Do you think that the current approach
through the Committee on Publication Ethics is working because you said there
is some responsibility on the journals as well as the institutions, so do you
think that system is working adequately or do you think there is a need for the
system to look at that, and I am not advocating government action here, just
your view?
Lord Sainsbury of Turville: Well, on the issue of peer review, I do not
think there is again any lack of clarity that people should have things peer
reviewed before they start making statements about them, so I think it is not a
question of misunderstanding, but it is a question of people not abiding by the
rules. I think it is a good question to
look at, whether there are enough clear statements which everyone subscribes to
that in these circumstances there should be perhaps more pressure that people
do not make these statements before they are peer reviewed.
Q52 Dr Harris: Let me finish with the specific suggestion to
get your initial view on it. In
clinical research, which is some of the most important research using patients,
in order to get approval for the study, you have to submit a protocol to an
ethics committee, a detailed protocol saying what you are going to do. It seems that, when you then submit the
manuscript for publication, you do not have to, and it is not expected that
you, submit the protocol so that they can check that you have actually
conducted the research in the published version in line with what you said you
would do when you got ethical approval.
Certainly in my view and in the view of many others, that is what
happened with the Wakefield case. Do
you think there is an argument that journals should demand the ethical protocol
so that they can check that everything that is said in the publication is
pretty much in line with what they got ethical approval for?
Lord Sainsbury of Turville: Well, I think that raises a number of quite
complicated issues. The issue we were
talking about before is people communicating things before they have been peer
reviewed, so that is one issue. The
issue I think you are talking about is a different one which is that you have
ethical approval for a particular protocol and getting a journal then to check
that what research had been done was in line with that protocol ----
Q53 Dr Harris: As part of peer review.
Lord Sainsbury of Turville: ----- again it might be a useful and
important thing to do, but again I do not know of any examples and I do not
know whether that is a real problem or issue.
If it was, then obviously we should look at it and take action.
Q54 Chairman: What consultations did you have with NERC,
the National Environment Research Council, prior to the recent announcement of
the closures at the Centre for Ecology and Hydrology?
Lord Sainsbury of Turville: During the allocation process following the
Spending Review of 2004, NERC indicated to my officials that providing the
Centre for Ecology and Hydrology with a sustainable future was a high priority. NERC then examined options to achieve this
in line with their responsibilities.
This included the Strategic Review over last summer with
stakeholders. OST was consulted about
the proposals NERC then developed to put CEH on a sustainable basis. An allocation out of the science budget was
then agreed in order to help achieve CEH's sustainability. NERC is currently consulting on its
proposals with the public and the staff.
CEH has seen a fall in contract research in recent years. I think it is to the credit of NERC that
they are grasping the implications of this now, looking at their science
priorities and developing a science programme for CEH which is of high quality
and sustainable.
Q55 Adam Afriyie: Are you personally content with the proposed
closures and the handling of them by NERC?
Lord Sainsbury of Turville: I think there are two different issues
here. As far as the decision about
consulting on the closures is concerned, I think that is totally the decision
of NERC. We have, I think, a very
strong tradition in this country which says that those kinds of scientific
decisions should be made by the scientists and not by ministers. I think the responsibility I have and OST
have is just to make certain that the way it is done and the way the planning
of it is done is done in a responsible manner, and I am content that they are
doing this in a very clear and responsible manner; they produced a very clear
corporate plan and they are consulting on it.
Q56 Adam Afriyie: During your consultations, what form of
consultation was there and is there any circumstance in which you have steered
the direction of the closures or nudged them in any way or recommended?
Lord Sainsbury of Turville: No, we were concerned essentially with the
process, that they had produced a proper plan, that they had consulted on this,
that they seemed to be taking account of all the issues you should take account
of and that they were doing it in a responsible manner.
Q57 Adam Afriyie: So they initiated the idea to close it?
Lord Sainsbury of Turville: This was their plan. They realised they had a problem in this
area and they, therefore, developed a plan to deal with it. The only comment I would make is that I
think it is to their credit that they are tackling this problem and trying to
put it on a sustainable basis and not letting it continue in its present form.
Q58 Adam Afriyie: I just want to be absolutely clear that it
was NERC that initiated the idea of the closures.
Lord Sainsbury of Turville: Absolutely.
This was initiated by them because they realised that they had a problem
here.
Q59 Adam Afriyie: If there are no questions over the quality of
the science coming from the Centre for Ecology and Hydrology, why was it cut
back, do you think?
Lord Sainsbury of Turville: I think there are a number of issues here,
and let me say something about the funding there. First of all, NERC is, like all the research councils, having a
very substantial increase in its budget allocation. It has almost doubled since 1997 to £134 million a year, so it
has gone up very substantially. Within
that, of course there are changes in terms of what NERC consider the priorities
to be where issues like climate change have become more important, although in
this particular case, as far as I can see, NERC do not think there will be any
reduction in their research portfolio in the fields of ecological and
hydrological research. What is
happening here, in common I think with a number of the special research
institutions of research councils, is that they are coming under pressure
because more and more there is an inclination to do basic research or blue-sky
research in this sort of field as in other fields of science within
universities because, by doing it within a university, you can access all the
different disciplines, so there is a tendency to shift from institutes ----
Q60 Adam Afriyie: A bit more competition, you are saying?
Lord Sainsbury of Turville: No, not more competition. It is that there is a well-considered view
internationally that separate research institutes have the disadvantage that
they become obviously specialised science institutions and in today's
multi-disciplinary world, basic research increasingly should be done in a
multi-disciplinary environment like universities. That is one issue.
Q61 Dr Harris: I have Oxford, one of the sites earmarked for
closure, in my constituency, I should say, but that is embedded within the
university, the building, so it is hard to see that argument. You say that there is going to be no impact,
or NERC tell you, on their research, but there are redundancies here, so the
volume must go down and biodiversity in particular is well recognised to be
markedly affected. Do you think in this
area, with climate change and other issues impacting on diversity, that we can
afford to lose that volume and make these redundancies, even the planned
redundancies from 600 to 400? How NERC
can think that people, particularly women scientists, are going to relocate
hundreds of miles away, in the case of the Scottish centre, is, I think, a bit
hard to believe, so on those two issues, the volume and the biodiversity so the
loss of capacity, is that not something that questions should be asked about by
you?
Lord Sainsbury of Turville: No, I think the point I was trying to make is
that there is not a fall of research in this area, but it is being done in
other places, in this case in the universities. The other issue that I was just going to draw attention to is
that these institutes have had quite a high proportion of contract commercial
research done in them. What NERC has to
do is take a judgment on the trends in this and whether this is sustainable
over the long term and indeed whether it is high quality ----
Q62 Dr Harris: I understand because you have said that
already, but in the reply we got from NERC, when we asked them, "What impact
would the closures be expected to have on the expertise available in CEH?",
they said, "Because some science would be discontinued, the breadth of
expertise would decrease", so even they are admitting something that you are
not admitting. If you reduce from 600
to 400, regardless of what is already happening in universities, that is a
reduction in capacity. That is just
maths.
Lord Sainsbury of Turville: No, I think what the letter says, from what
you say, is that there will be a drop of expertise within CEH. That is not the same as what I was saying,
which is looking at what is the total amount of research and expertise across
the whole of NERC's portfolio, a very large proportion of which goes through
universities.
Q63 Chairman: Do you think the reduction in terms of the
institutes is a trend, Lord Sainsbury?
Are we likely to see that across other research councils where the work
of the institutes becomes less important as work goes into the universities and
should we be concerned about that?
Lord Sainsbury of Turville: We do not have a policy on this, so this is
not a situation where we are, as a matter of policy, pushing this, but I think,
if you just observe what is going on and the decisions being made in particular
situations, there is a rather clear trend here. For example, the NMIR, the whole question of the relocation where
we consulted very much on an international basis, an enormously strong steer
was given that the rebuilding should not take place on its current site in Mill
Hill, but it should be linked in to a major university, and I think that was
probably very good advice.
Q64 Chairman: But you have a review going on at the moment
of all the institutes, so you must have some concerns about their future
viability?
Lord Sainsbury of Turville: Well, I think all I am saying is that I think
you will see more cases where people will take the view that, for that area of
science, it should be placed within a multi-disciplinary environment if you
want to get really world-class science.
I think that as a whole is probably the right judgment in many cases,
but again I think this is a judgment that the scientists ought to be making
within their particular fields and particular areas of research.
Q65 Chairman: Our last line of questioning is on research
and development and knowledge transfer. What conclusions do you draw from the DTI's Autumn Performance
Report for 2005 on the success measures to encourage investment by industry in
research and development?
Lord Sainsbury of Turville: Well, I think the latest figures for business
R&D were frankly a disappointment.
Although the real value of business R&D is still 20 per cent higher
than in 1997, it has not grown as fast as the economy. The fall in business R&D in 2004 was due
to a six per cent reduction in overseas-funded R&D, whereas R&D from
UK-owned business increased. The
pattern, although the central level is mixed, aerospace R&D increased
significantly, whereas R&D fell substantially in the automotive and
computer sectors. The volatility of figures means we should not read too much
into single year figures but we need to continue our efforts to create the
conditions for investment in R&D and business success. This includes using UK trade and investment
to market the UK as a location for high value activities including R&D.
Chairman: Thank you very much.
Q66 Margaret Moran: Good morning, Lord Sainsbury. That is rather in contradiction of what you
told this Committee at the last meeting, in so far as you were saying that you
felt at that stage that investment in R&D as a proportion of GDP had
bottomed out and was beginning to grow. What do you think are the main factors
as to why that has changed? Do you
think the measures we have in place at the moment, which you described to the last
Committee, are sufficient to reach the target for industry investment in
R&D that the Government have set?
Lord Sainsbury of Turville: As I said, I think it is a
disappointment. We have had two to
three years where it has been going up; it appeared to have bottomed out and to
be going up; and we have had a situation where it has fallen back. Clearly there is a changed situation and
that is a disappointment. I think it is
important to realise where it has come.
It has come in the foreign investment in R&D, and it mainly appears
to be in the area of pharmaceuticals. I
think we need to do more work to see whether there are any special conditions
applying in this area. There is a
general sense that pharmaceutical companies the world over have been diversifying
their research portfolios around the world.
Practically no pharmaceutical company does all its research in its home
country. I think we need to do more
work on this field.
Q67 Margaret Moran: Do you think generally a change in approach
is needed by the Government now we are seeing this decline, or do you think
this is part of a cycle? What
discussions are going on to tackle this with the DTI and the Treasury?
Lord Sainsbury of Turville: I think one needs to say that number of the
measures we have taken to encourage R&D have probably not yet fully come
through. We have had the R&D tax
credits and of course we are doing a lot of work with the technology strategy
which I think will encourage more R&D.
It is probably true that these have not yet had the time to have a full
impact, but, I agree with you, we need to do more work in this area,
particularly into why there has been a fall in pharmaceuticals' research, and
to see whether we need to adjust any of those policies.
Q68 Mr Newmark: The one thing that particularly concerns me
is the fact that these figures would be much worse and that the distorting
figure is the R&D spend on, I think, defence. Defence R&D, I understand, has gone up 13 per cent in real
terms. If one stripped out the
extraordinary increase, perhaps, in defence R&D, the situation in UK plc in
terms of our industrial base would be even worse.
Lord Sainsbury of Turville: I would be very interested to see where you
get your figure for R&D for defence.
Defence R&D as a whole has been going down. It is slightly complicated by the QinetiQ
situation but I am rather surprised that it has been -----
Q69 Mr Newmark: The source is the DTI 2005 Autumn Performance
Report, page 9.
Lord Sainsbury of Turville: I will have a look at that. As a whole, the situation on R&D truly
in defence has been going down. But I
will certainly have a look at that.
Q70 Mr Flello: Good morning, Lord Sainsbury. With the rapid development taking place in
China, how can the UK remain competitive in R&D against that?
Lord Sainsbury of Turville: I personally have been more strongly pointing
out than anyone else the challenge that China and India pose to this country -
and I have been doing so for many years.
I think you need, however, to be rather careful about thinking that the
huge growth in wealth in China, which of course is from a very low base, is
fuelled by Chinese technology, because it is not at all. It is fuelled by, first of all, wage costs,
which are five per cent of ours, and, secondly, by huge amounts of foreign
direct investment which is, by and large, producing the technology in China
which enables them to produce goods. So
a lot of the, say, Japanese electronic companies are now producing in China,
but that is not with Chinese technology, it is with Japanese technology. It is an extremely interesting question as
to what exactly, in world competitive terms, Chinese technology and science is
at. For all that, I conclude that we
can stay ahead of China in terms of research in technology, but we have to move
pretty fast because they will start now going up the value-added chain. They have very good scientists; they have,
of course, a lot of scientists now returning from America to China, which I
think will enable them to go up this curve very fast; and of course they are
ruthlessly selective as far as their universities are concerned. They say, "We want to have ten world class
universities," and if you start from a population of 1.25 billion students,
selecting the best people to go to Tsinghua University, you will have some very
good students. I think Chinese science,
long term, will be extremely good, a competitive threat. As, at the moment, we are obviously way
ahead of them, we need to keep moving very fast in terms of science and
innovation to stay ahead.
Q71 Mr Flello: You say you have been saying for sometime
about your concerns in the area. Do you
think you are being listened to and that action is being taken on your words?
Lord Sainsbury of Turville: I think now you can see that in the Chancellor's
speeches, the Prime Minster's speeches, there are constant references to the
threat of China, and indeed India in certain areas, and this is something we
have to take enormously seriously. If
you go back to the Prime Minister speech on Science
Matters, you will see that even at that stage - and that is three or four
years ago - he was referring to the developments in India and what was
happening in Bangalore.
Q72 Mr Flello: Do you think industry is taking heed of your
words?
Lord Sainsbury of Turville: I think so, yes. I think it is a general perception. I do not think it is an original perception to me, but, yes, I
think they understand very clearly that if we are going to stay ahead we have
to move into high-tech added-value areas where we can compete against, as I
say, a country where wages are five per cent of ours. We cannot compete in labour-intensive areas with that wage
differential.
Q73 Margaret Moran: How effective do you think Research Councils
are in promoting an increase in industrial R&D? To what extent is funding based on delivery of results? Secondly, on a separate subject, that of
intellectual property rights, do you think that UK plc is maximising the value
from intellectual property rights that it should be getting?
Lord Sainsbury of Turville: I think it is very important to be clear what
we require of Research Councils. We
require Research Councils to fund world class basic research. I should say that that is seen by most
people in the science policy field as being an essential part of having a very
vibrant high-tech economy. You do of
course also need to do significant amounts of applied research, but that I
think we rightly put under the technology strategy in the DTI. The difference between basic research and
applied research in this context is that you do them in completely different
ways in terms of both managing them and evaluating them. The Research Councils' remit is to do basic
research. Each Research Council now,
however, has knowledge transfer objectives, and of course schemes of knowledge
transfer incentives, like HEIF3, have absolutely revolutionised the culture
within universities, so we are now seeing a total change in the performance of
universities in terms of knowledge transfer.
Whether you look at spin-off companies, licensing, patents, you will see
there has been an extraordinary change over the last five to ten years in the
performance of the universities. I
think we are beginning to see a real change in the situation. Just to give you one fact to show that: in
the last two years, we have had 20 university spin-offs floated on the Stock
Exchange. The total value of those
spin-offs is £1 billion. It simply is
not credible now to say we are not getting a lot of knowledge transfer from our
universities. As far as intellectual
property rights are concerned, we have made some quite significant changes in
the mission of the Patent Office. It
used to be that the Patent Office was simply there to administer the system of
intellectual property rights. We have
said that mission should be extended to cover the field of innovation, so they
now have both an enforcement and an educational role - which I think they are
rather successfully doing - and we will be asking the new Gowers' Report to
look at not the efficiency of the Patent Office, which is very high, but at
whether they are providing the best possible service to industry, and that is
one of the other issues we will look at.
Chairman: Lord Sainsbury, as ever, the time has gone by
very, very quickly. Perhaps we ought to
extend it even further next time. Thank
you very much indeed for joining the Committee this morning.
