WEDNESDAY 13 JUNE 2007

MR IAN GALLETT, DR LESLEY THOMPSON, DR RALPH RAYNER AND MR RICHARD BURT

  Q280  Dr Turner: I was going to Oceans 2025 because one of the criticisms that certainly the university sector will make about it is it is not inclusive. It did not include them. It clearly does not include the associated industries. Whereas in the US there is a much more cohesive organisation, it is also much more bottom-up, so that scientists' views are really coming through in terms of priorities. Do we need to do something comparable in the UK. If we did that, could we arrive at a situation where, instead having a sum of all the different parts that are going on, we had something bigger and would get more funding?

  Mr Burt: Yes, I totally agree. It needs cross-collaborative engagement and it needs engagement between science and industry. You are absolutely right, an overarching clear way forward is fine, providing it is an efficient structure and just has not grown to too large a compass.

  Q281  Dr Turner: What sort of form do you think this will take? We got the distinct impression that one of the reasons why things seem to be going quite well in the States is that it is not done on a top-down basis, like an agency like NASA, but it is very much based on a sort of bottom-up approach that comes together. How do you think we could achieve that in the UK? How would you form this organisation? Would you start with the IACMST and reform it and give it a more powerful remit or would you create an equivalent of a NOAA?

  Mr Burt: From an industry perspective, although we know IACMST has lacked teeth, in effect, it has brought the key players together over a number of years—and I do include industry and academia in that area. I think you have the core players there engaged within that organisation, so I would say there is a first pass to look at reorganising that rather than implementing something different.

  Q282  Dr Turner: So build on what you have got.

  Mr Burt: But change it for what we require today.

  Q283  Dr Turner: Does anyone want to add to that?

  Dr Rayner: I think you can use the links to the professional societies as well, they have a strong role to play in this process. They can help to foster those linkages. One of the problems you have is that, once you start talking about funding for marine science and technology, the beneficiaries of the funding are distributed and they are each vying for their individual sources of funds. There is no collective pot, either at a UK level or indeed at the European level, so there has always been a problem with the marine sector being very diffuse.

  Q284  Dr Turner: If it was cohesive, it might be able to argue for a bigger pot.

  Dr Rayner: It would but who would be the recipient body for that pot?

  Q285  Dr Turner: That is always the problem.

  Dr Rayner: That is the problem. You can level the argument but you then have to have clarity as to the way in which those funds would be administered

  Dr Thompson: I would like to make a personal comment. Always when you find units of organisation you have to find the right unit for organisation. If you go bottom-up, it has to be something where everybody feels that committing their time is giving them what they need and they get their just return. In my own mind, I am not clear whether an organisation across the whole of marine, if you are trying to do bottom-up, is appropriate, or whether it works in smaller units. An example of a smaller unit with bottom-up organisation is the flood risk management activity, where a whole range of funders and industry and academic groups come together to tackle, as consortiums, some of the issues around flood risk management. That works at a unit where everybody feels they are getting something. If you cover the whole of the marine area and then you look at some of the issues in marines that take energy, there are already other bodies that try to coordinate energy, and so you will end up with interfaces. I think the most important thing is that if you go bottom-up people feel they are making a contribution and they can see some return for their contribution. I am not sure, necessarily, across a diversity of marine, with all the interfaces that marine has, either with other technologies or with other parts of the environment, a single focus on marine would be enough to bring cohesion across the whole of industry, government departments, and the science base. In the UK, people dread—and my own organisation is as guilty of this as anyone—getting entwined in lots of discussion meetings without seeing very positive forward action.

  Q286  Dr Turner: That is fair enough. We have quite enough talk shops and different funding pockets as it is. That is one of our problems. We need to do a bit of amalgamation but not necessarily forced amalgamation.

  Dr Thompson: I think that is the very interesting thing, if you want to go bottom-up, how you get units that self-assemble because they feel self-interest, rather than being forced down. I think that is sometimes an uncomfortable marriage. We have some examples where we have got self-assembly of self-interested groups and we pull together a consortium of funders, a consortium of companies and of academics to work on specific areas. One area, I would say, is flood risk management. Another area is SuperGen Marine Consortium, where we have industry, NERC, EPSRC, the Environment Agency, the Department of Trade and Industry and a number of academic groups working together for common purpose and making sure that there is a short transfer of any technology that comes out quickly to companies who will shorten the innovation cycle.

  Q287  Dr Turner: SuperGen was essentially a government initiative, was it not?

  Dr Thompson: SuperGen was our initiative but it has not stayed as an EPSRC initiatives, it has managed to brigade a consortium of funding partners, a consortium of industry who have come in and added their funding and, now it is on its second round, it has also added on additional academic partners to give what we need for a marine consortium in energy generation.

  Q288  Chairman: Dr Rayner, did you want to come in?

  Dr Rayner: I wanted to comment on the way in which funding mechanisms can engender cooperation. If I look at what is happening at a European level in terms of operational oceanography, the GMES programme in Europe and the moves towards creating a pan-European capability in operational oceanography have very much been fostered by the fact that there is a fund being administered through the Framework Programme which is bringing together all of the parties. It is the existence of the funding that caused them to come together and, having come together, they are starting to work as a coherent pan-European group (that is, industry, academia and government laboratories working in a team) which is progressively becoming more integrated, but it took the existence of the pot of funding, partial funding, to cause that to happen.

  Q289  Linda Gilroy: We have begun to touch on knowledge transfer and I would like to take that a bit forward and ask you to share with us your thoughts on the mechanisms to facilitate marine technology development and their commercialisation. Are they working and how could they be improved?

  Mr Burt: From a UK perspective it is quite interesting. First of all, we have to identify where the technologies are. There are many, many technologies being developed in marine science and technology centres in the UK often for extreme applications. Very few of them are what I would call commercial products or capable of being commercially exploited. From the industry perspective we have to do a number of things. We have to identify technology which we can economically evolve into a product which can then be sold commercially around the world and make money for UK industry but, also, we have to produce the products that the marine science and technology organisations do require. That is two different things. From an operational oceanographic point of view, you are looking for sensor technologies, for example, which have to last for long, long periods of time in the environment, doing a number of things with very little human interaction but always giving you good data. That is a clear link into applications for operational oceanography in climate change. But if you are looking at some of the basic research that is being undertaken in the laboratories here to pump-prime that activity, then the type of instrumentation they require is different. The first part of the jigsaw is where we have to identify technologies. From the UK perspective, from a UK company, we have to look at worldwide technologies, just not UK technologies. There may well be something applicable in the US or in Japan that is at a very early development stage which we could licence or enter into an agreement to pull through, so, although the added value is eventually there for UK industry, UK marine science, perhaps, does not benefit because it has not developed that instrumentation route. The financial mechanisms to make that happen are poor, to say the least. There are very little opportunities to get significant funding to pull through technology to the market place. There are DTI schemes, there are NERC schemes, but when we lay these alongside, for example, US schemes, then I think the UK is poorly placed. There are a number of US schemes which are geared to early innovation, fully funded schemes for small spin-out companies to bring product through to the market-place. If we sit here today and look at where the competition is against UK industry, many of our competitors are in the US and many of those have developed into companies using third-party funding, and often 100% third-party funding, to bring them to market-place with a technology and begin trading. In the UK, even if we embark upon the most generous of DTI schemes, it contributes very, very little, if anything, as you enter production and bring products to a commercial realisation, so there are significant overheads for the UK to have to recoup once it starts to sell product. If your competition has no overheads to recoup, you are immediately at a significant disadvantage. I think the funding schemes within the UK to enable technology to pull through are not as advantageous as they could be with competition. The other means of funding is through European schemes, through the framework schemes, but that then fosters collaboration. Collaboration can be good for scientific programmes, technology programmes, and ensuring appropriate technologies are brought to the market-place for that, but it is not always appropriate to collaborate with potential competitors commercially. Single-funded schemes out of a European perspective are not really there, so we have to come back again to look at the UK situation for funding, which again is at a disadvantage to overseas.

  Q290  Dr Spink: But you do accept that the sort of funding that they enjoy in the United States would not be possible with EU regulations in this country.

  Mr Burt: Yes. But commercially the outcome is to disadvantage us.

  Dr Spink: We understand that.

  Q291  Linda Gilroy: Mr Rayner, the institute has been very critical, particularly in respect of small and medium enterprises—which very often are what we are talking about, of course. In your evidence you have said that it is not only ineffective and excessively bureaucratic but, also, it can damage existing businesses with unfair competition.

  Dr Rayner: There are three separate elements here. The marine science and technology industry area is a series of small, niche markets. It is not a very large pooled market, so companies tend to specialise in a very narrow niche and what is really required for small companies is helping them to exploit that niche on a wider geographical basis and helping them to create new technologies into those global niche markets.

  Q292  Linda Gilroy: Have you seen any good examples of where that happens in the UK? Are any of the science parks, for instance, developed—

  Dr Rayner: There is really very little activity directed towards helping small companies to broaden their geographical market. I would go back to something that Richard Burt said about the equivalent position in the United States. In the United States, government agencies, and particularly NOAA, are quite engaged in supporting the activities of small companies in penetrating export markets. It is not surprising, because NOAA is part of the Department of Commerce, that it has a very specific commercial imperative and you will quite often see small, niche American companies being supported in promoting their products by NOAA as a government body. I cannot think of any examples of an equivalent position in the UK.

  Q293  Linda Gilroy: Have you seen any evidence of that happening at regional development agency level?

  Dr Rayner: Not really, no.

  Q294  Linda Gilroy: Or through the science parks? I can think of some, in Plymouth, for instance, fairly modest, where the Tamar Science Park responded at the time to assist some people who lost some of their funding during the NERC streamlining. Do you have any contact with the science parks?

  Dr Rayner: A little. I think the difficulty here is making it highly targeted, picking niches—and I know this is a very interventionist approach.

  Q295  Linda Gilroy: The one I am thinking of was a niche area.

  Dr Rayner: You pick a niche and foster it and then promote it widely internationally. It is very difficult for small companies to do that in their own right. It is very beneficial if they can be supported in doing that—and I do not necessarily mean financial support; I mean support in terms of proximity to markets and making their products and services more widely known.

  Q296  Linda Gilroy: Are there ways in which you can think we need to change? Is it a NOAA type organisation or something more at that sort of regional level of economic activity?

  Dr Rayner: I think it should be national rather than regional. I find it very difficult to see how it would work at a regional level when you are trying primarily to promote into export markets. That is something that really should be driven at a national level.

  Q297  Linda Gilroy: I would comment on that, Chairman, before moving on, that the South West Regional Development Agency has an office in China, so a lot of the activities are happening at that level. Mr Gallett, would you like to comment on that?

  Mr Gallett: It is not a main area of interest. I would only note on the regional side that there does seem to be more money available north of the border. Certainly Grampian Enterprise and Scottish Enterprise between them seem to be rather more generous in their support of small companies, particularly in the Aberdeen area with which I am quite familiar.

  Q298  Linda Gilroy: Do any of you have familiarity with Wales? I have heard anecdotally that that may be true in Wales as well.

  Mr Gallett: I do not have any knowledge about it.

  Dr Thompson: It is clearly an area of great concern to us. If we are developing technology and the UK is not making best use of it, then that is a concern for all of us. Within the resources we have, we work very hard to make sure that, where it is appropriate, there are good contacts with companies, so certainly 40% of the research portfolio we support is collaboration with industry. It is harder for small companies to collaborate with the science base, although that does not mean it does not happen. It happens when people have made the right contacts. Increasingly, we are trying to use our own time and effort to try to make sure we go directly to companies and try to look for intermediates that give us the leverage to have those dialogues, to make companies aware of some support they can get through engagement with the science base, but it is much harder than going to talk to the universities that we have, so it takes a lot more time and a lot more resource and, increasingly, finding ways we can work together on some of those things, particularly with things like regional development agencies, is becoming very high on our agenda. We have just reorganised our own internal structures so that we have a defined point of contact with every regional development agency devolved authority and through that agency we are trying to find ways that we can jointly promote companies working in the science base, as well as doing lots of things on a national level working with the DTI.

  Q299  Linda Gilroy: It sounds a bit bureaucratic and like quite hard work at the moment.

  Dr Thompson: It is hard work.