Britain to Dangle New but Small Carrot for Business to Up Investment in R&D. (November 10, 2006)

     Last week Britain's Labor Government announced a significant administrative change which it hopes will entice its private sector to move its commitment to research, development and innovation from its current 1.2% of GDP to 1.7% by 2014.

As Nature points out in it current issue, "Innovation policy in Britain traditionally falls under the remit of the Department of Trade and Industry (DTI), which has long housed a pot-pourri of small initiatives and programmes aimed at fostering industrial innovation."

In 2004 a Technology Strategy Board (TSB) within DTI, chaired by IBM's Graham Spittle, was set up to oversee that bunch of initiatives, and the government has now decided that early in 2007 the TSB will effectively be spun off from DTI and become an autonomous entity. A chief executive is to be appointed with a small staff; it is to operate at arm's length from the government, and will be managed by a board drawn from the industrial and financial sectors. The object is to create an entity much like the research councils that support British scientific research, but with a  mission of fostering  R&D and innovation in the private sector.

Nature believes that by "pulling it out of the DTI [it] will have at least two other significant advantages. It will help the committee to address innovation, not just in manufacturing industry (DTI's traditional remit) but also in the service sector — ranging from publishing to banking — which now constitutes four-fifths of Britain's economy."

And perhaps a bit cheekily the journal also suggests that by "supporting innovative suppliers [to Her Majesty's Government] through the 150 billion (A$373 billion) or so that it spends each year on goods and services" the small carrot at the board's disposal (around £170 million worth of grants and other programmes) will leverage into a sizeable stick.

However, the Confederation of British Industry, a strong advocate of the spin-off of the TSB, reckons that no less than £600 million should be placed at the disposal of the board if it is to have a significant impact.

In fact the matter of funding is to be addressed by the Treasury in next year's Comprehensive Spending Review and if the current Chancellor, Gordon Brown, has assumed the Prime Ministership by then Britons could have a significant indication as to just how supportive he will be of a "knowledge economy".