Memorandum submitted by Prospect (FC 16)

Introduction

1. Prospect is a trade union representing 122,000 scientific, technical, managerial and specialist staff in the Civil Service and related bodies and major companies. Our members are professionals, managers and specialists across a diverse range of areas, including agriculture, defence, energy, environment, communications, heritage, justice and transport.

2. We welcome the opportunity to submit evidence to this inquiry. Our response to the themes identified by the Select Committee is set out in the following paragraphs. Some of these are ongoing issues, of key concern to Prospect members, and require urgent resolution.

The process for deciding where to make cuts in SET spending

3. We would emphasise that there is actually a strong case for increasing expenditure on SET, and note that this sentiment was supported by the Prime Minister in his Romanes Lecture at Oxford in February 2009: "Some say that now is not the time to invest, but the bottom line is that the downturn is no time to slow down our investment in science but to build more vigorously for the future. And so we will not allow science to become a victim of the recession - but rather focus on developing it as a key element of our path to recovery".

4. Whilst Prospect accepts that priorities can and do change, we object to the fact that major decisions have been taken - for example about site closures, transfer of functions and significant cuts in funding streams - with no central knowledge by government of the location, functions or specialist expertise it employs. Hence there is no clarity of what capability is being lost or whether retained capability will be sufficient to cope with future demands. Recent work by Government Skills demonstrates that departments and professions are unable to collectively provide work force data that is accurate enough to facilitate effective work force planning. A number of professions, including science and engineering, have identified work force data as being a key issue for them in making progress against their aspirations.

5. Recent examples of poor decision making include:

6. Closure of the world-renowned 192-hectare Wellesbourne site of Warwick HRI, formerly Horticulture Research International, by the University of Warwick. All research work will be transferred to a new School of Life Sciences on the Warwick main campus from 2012. Thirty per cent of staff will be made redundant, including principal investigators, research and support staff. WHRI employed about 35 academic staff at principal investigator level, together with 175 research and support staff, plus PhD and MSc students. It was ranked as the UK's top university department for agriculture, veterinary and food science in the 2008 Research Assessment Exercise.

7. In Prospect's view, the university's decision was made on the basis of a report that:

· Did not present a coherent case on economic, public health, food security or environmental grounds;

· Took no account of funding sources available from Defra, the Technology Strategy Board or industry;

· Focused on basic research, instead of key disciplines in agricultural science that the Royal Society has recognised as being in urgent need of investment;

· Ignored the translation of research into practice, a key aim of Government and the Biotechnology and Biological Sciences Research Council;

· Had no policy for engagement with industry or to seek multi-donor funding.

8. Only 11 days notice of the proposals was given to staff via their union, and there was no prior consultation with policy makers or funders (Defra, BBSRC or the Agriculture Development and Horticulture Advisory Board).

9. At the National Physical Laboratory (NPL) discussions are currently underway to alleviate the consequences of proposals for significant funding cuts from the parent Agency - the National Measurement Office (NMO). A likely funding cut of around 10% could not be sustained without job losses and the corresponding loss of scientific capability, with in excess of 40 posts at risk. This would inevitably mean choices about the retention of scientific capability and perhaps decisions that will be regretted in the future when immediate cost pressures ease.

10. This is despite the existence of a significant body of evidence illustrating the impact of measurement science as uniquely practised by NPL. Economists from the Department of Business, Innovation and Skills estimate that every £6m spent by Government on measurement technology delivers £410m of economic impact to the UK, so any cuts are correspondingly magnified. In addition the Advisory Group from the Royal Society and Royal Academy of Engineering appointed by the Secretary of State to oversee the quality of science from NPL, although pleased by the work undertaken, has been increasingly concerned that the investment is insufficient to enable NPL to provide a critical mass to have a real impact in emerging areas. Professor Ian Shanks, Chairman of the Advisory Group, said that the potential loss of science capabilities would significantly impact on NPL's ability to meet the challenges of metrology support to data security, health-care, advanced manufacturing, low carbon and environmental issues - topics of central interest to Government where NPL could have a real impact for the benefit of the UK.

11. Helpfully discussions are currently in progress, leading to a Ministerial commitment to review the processes and evidence base that led to the reductions in NPL's funding from NMO and NPL's success in attracting additional funding from other areas that could have mitigated these shortfalls. However, at the time of writing the redundancy process is ongoing and key scientific staff could be lost in a few weeks time. Further Prospect would emphasise that, although we hope that the situation may still be retrieved, in fact there is a clear responsibility on the part of Government to ensure that consultation takes place in an appropriate manner at the time decisions are being discussed and most certainly when economic decision are made that will clearly have an effect on employment.

The decision in the ECJ last year (Akavan Erityisalojen Keskusliitto AEK ry and ors v Fujitsu Siemens Computers) made it clear that the obligation on employers to consult arose when there were 'strategic decisions' or 'changes in activity' that may lead to redundancies. The Government's position stems from decisions made in summer 2009, and our understanding is that the NMO were also aware of the position at this time. Yet, despite this there was no consultation with Prospect until November of 2009, some four months after the decisions were made.

12. We would also like to draw to the Select Committee's attention the risks currently surrounding the proposed redevelopment of the Institute of Animal Health's Pirbright site. Prospect members at both IAH Pirbright and Compton welcomed the decision announced in September 2009 to invest £100m in the Institute, but there is now concern that pressure on the public finances will mean that there may not be sufficient funds to complete the redevelopment in the timescale required or to the high standard for the laboratories and other facilities needed. This is particularly sensitive given that Pirbright was the source of the 2007 FMD outbreak. Members are concerned that corners may have to be cut or, alternatively, that progressing with this redevelopment at a time of wider budget cuts will place all other Institutes and programmes under strain.

13. Prospect's view is that without effective cross-government scrutiny irrecoverable damage can result to our science base, and it is clear that in the case of NPL real commercial impacts will follow. As long ago as 2006 Prospect published a Charter for Public Science identifying, among other objectives, the need for a clear strategic vision for UK science and a Cabinet Minister with authority and accountability for public sector science - with a similar Ministerial role in the devolved administrations. We therefore very much welcome the Government's decision to establish a Cabinet Sub-Committee on Science and Innovation and we welcome the fact that the Science Minister, Lord Drayson, attends Cabinet meetings. However, more could be done immediately to make sure that Lord Drayson's Cabinet level role includes cross-cutting accountability for public science and is not simply to act as an exponent of science in Cabinet, important though that is.

What evidence there is on the feasibility or effectiveness of estimating the economic impact of research, both from a historical perspective (for QR funding) and looking to the future (for Research Council grants)

14. Laboratory staff and university researchers are scientists, not entrepreneurs. Whilst the economic impact of scientific research is important, to allocate basic research funding based solely upon perceived economic outcomes is counter-productive. Research should be funded according to scientific merit. If the current trend of modelling the UK's SET base as the R&D arm of industry continues, with no "blue sky", curiosity-driven research, we will be unable to compete scientifically with our peers overseas.

The differential effect of cuts on demand-led and research institutions

15. Prospect believes that science and technology have a crucial role to play in identifying high quality and sustainable investment opportunities that would help to lead the economy out of recession. We welcome the fact that recent Government policy statements reflect this priority. However, the same commitment must extend to funding for blue-skies work and pure research and development, which must come from an adequately funded and motivated public sector science base. Public science must provide a measure of stability to preserve the UK's technical capacity through short-term fluctuations in demand. In practice, world-leading UK programmes including research into breast cancer, agri-engineering and animal diseases have been closed. Research on the impacts of climate change, pollution and biodiversity all struggle for funding. The level of core funding for research institutes leaves many of them highly vulnerable to shifts and reductions that owe more to short-term changes in departmental priorities than to the quality of work being undertaken.

The implications and effects of the announced STFC budget cuts

16. Prospect has yet to understand the full implications of the announced cuts. Nevertheless, the impact of the cancellation of projects that have been found to be excellent by international peer review undermines our status as a first rate scientific nation. For example, the New Light Source project would have propelled the UK to the forefront of a revolution taking place in the physical and biological sciences - the ability to study molecular interactions in real time. Instead, this new frontier will be explored by our competitors in the United States and Germany, who have significantly increased their science budgets in response to the financial crisis. There is also the risk of under-utilisation of UK investment in large capital projects only now coming on-stream, for example Diamond Light Source and the next-generation ALICE prototype accelerator at Daresbury. It is too early to assess what, if any, impact there will be on STFC staffing.

The scope of the STFC review announced on 16 December and currently underway

17. Any re-organisation of the functions of STFC must ensure integrity and continuity for the Daresbury and Rutherford laboratories. These institutions are national scientific assets which have been built up over 50 years. The staff who operate and maintain the facilities contained within these labs are unique in terms of their expertise and skills. The STFC review is expected to conclude by the end of February, with the aim of quickly implementing its recommendations. Whilst Prospect has welcomed Lord Drayson's intention to resolve the tensions that inevitably rise from vesting responsibility for international subscriptions and research grants in the same organisation, we are concerned that whatever the outcome, it is already being made clear that there is unlikely to be any more money available.

18. It is demoralising for laboratory staff to suffer cuts to investment in scientific facilities and research whilst large amounts of the laboratory budget are wasted on the poorly conceived and executed outsourcing of ancillary services that is the RCUK Shared Services Centre. Latest information is that the estimated cost of this project has spiralled from £40m to somewhere between £132-140m. STFC is responsible for just over 25% of the cost of SSC and so, based on the original costing would have been responsible for £10m of cost. In practice, STFC is likely to be asked to pay about £35m - not far short of its £40m budget deficit.

19. The recent financial crisis has placed immense pressure on STFC's budgets due to their agreed commitments to international subscriptions to facilities such as CERN. The actual cost in pounds sterling is subject to exchange rate fluctuations, and because of the 'banking crisis', this further reduces the funds available to support the UK's own national laboratories and universities. Whilst the Government has acknowledged that our economy cannot continue to be based on the provision of financial services, with a vision of science and innovation replacing financial services as our economic foundation, it is clear that the SET community are quite literally paying for the greed and failings of the financial sector. STFC is an organisation of scientists, not bankers, so STFC should not have to fall victim to these fluctuations once our overseas commitments are agreed.

20. Delivering world-class, cutting-edge SET is hard enough in itself. It does not benefit in any way from the unending pressure on budgets, staff and infrastructure which has repeatedly lead to these highly public and undignified struggles for limited resources, often punctuated by misleading coverage in various news media. This damages staff morale, the public perception of science and its societal value, and makes it harder to encourage new people to enter science, thus ultimately causing massive damage to science itself. It is essential to ensure that sufficient funding is placed into SET budgets; the appropriate structural divisions within the SET community are made; and that there is a stable and capable management structure to create the right environment for true science and innovation to flourish in the UK.

The operation and definition of the science budget ring-fence, and consideration of whether there should be a similar ring-fence for the Higher Education Funding Council for England research budget and departmental research budgets

21. Prospect strongly supports the continuation of a ring-fenced Science Budget, though stronger safeguards are needed to ensure that the ring-fence cannot be breached in response to short-term financial pressures. There is overwhelming evidence of the need for a similar ring-fence for departmental SET budgets.

22. The Government's 2009 SET Statistics show that whilst Science Budget expenditure has grown significantly over the last 10 years, with the exception of the Scottish Government SET expenditure by civil departments has fared much worse. Table 1 shows that overall civil departments' SET expenditure fell by 18.2% in real terms over a ten-year period from 1997-8 and of 28.1% between 2006-07 and 2007-08. DEFRA's expenditure on SET fell by 17.5% over the same ten years and very sharply, by 51.2%, between 2006-7 and 2007-8. The Department for Transport similarly suffered a 53.6% cut in SET expenditure between 1997-8 and 2001-02 which has not been restored. Growth of 20.2% in NHS SET expenditure in the ten-year period from 1997-98 masks a 33.8% cut elsewhere in the Department of Health over the same period. A 28% overall cut in MOD's SET expenditure over the ten years from 1997-98 includes a cut of 12.4% in research expenditure and a cut of 33.1% in development activities. SET real terms expenditure in the Devolved Administrations increased sharply in the five years from 1997-8 to 2001-2, by 82.2% in Scotland and 90.9% in Wales. However, there has been no growth in SET spending in Scotland since 2005-6 and, as a consequence of progressive cuts in Wales since 2001-2, SET expenditure by the Welsh Assembly Government in 2007-8 was 45.5% lower than in was in 1997-8.

Table 1

1 Formerly PPARC & CCLRC; 2 Formerly MAFF; 3 Formerly DETR; 4 Formerly DTI; 5 Formerly Scottish Executive; 6 Formerly Welsh Office.

Source: 2009 SET Statistics Table 2.2

23. Furthermore, as shown in Table 2, it is of concern that the most recent information about departmental expenditure on R&D, shows some significant shortfalls when compared with CSR expenditure plans for 2007-08. Again there are significant shortfalls in expenditure by civil departments including DEFRA, the Health and Safety Commission, Department for International Development and the Welsh Assembly Government. There is also a substantial cut in MOD expenditure on development.

Table 2

Source: Campaign for Science and Engineering

24. The longer-term trends are also confirmed in Table 3 which shows the contribution of the Science Budget, civil departments and the MOD to total government expenditure on SET. Science Budget and HE funding councils' SET contributions have grown, but departmental expenditure now accounts for a smaller share - both in relation to civil and defence applications. Allocations to Higher Education Institutions continue to account for around half of all research council expenditure, mainly through payment of grants. Expenditure on research councils' own establishments accounts for around one quarter of total expenditure, though with a growing share for facilities rather than institutes. Administration costs remain at a modest 5%.

Table 3

Source: 2009 SET Statistics Table 2.5

Whether the Government is achieving the objectives it set out in the 'Science and innovation investment framework 2004-2014: next steps', including, for example, making progress on the supply of high quality science, technology, engineering and mathematics (STEM) graduates to achieve its overall ambitions for UK science and innovation

25. Experience of the recession may to some extent have diminished the attractiveness of the financial services sector as an employment destination for STEM graduates. However, we are concerned about the implications of recent government announcements for the numbers and quality of science graduates and the research output of the UK university sector. We are also concerned that there is little to incentivise talented STEM graduates to pursue a career in government science. R&D employment in research councils has fallen by 9.1% over the ten years since 1997-98. By comparison employment in civil departments has fallen by 34.8% and in the Ministry of Defence by 55.1% Continuing pressures on SET budgets and on individual terms and conditions will only reinforce existing negative perceptions.