John Denham - Launch of the Science Budget Allocations

Opening remarks

Firstly, a warm welcome to you all to this event. I am delighted to be here today to present the allocations of the Science Budget for the next three years.

DIUS story

The new Department for Innovation, Universities and Skills was created by Gordon Brown as one of his first acts as Prime Minister. It brings together for the first time in Government three closely-linked strands of policy which will be key factors in determining Britain’s future economic and social wellbeing.

The Prime Minister and I believe that Britain can only succeed in a rapidly changing world if we develop the skills of our people to the fullest possible extent, if we carry out world-class research and scholarship, and if we apply that knowledge and research to create innovative and competitive products, services and companies. In turn, we need to raise skills levels in order to take advantage of the opportunities that an innovative economy brings.

So the three strands of our work are all crucial for the future of this country.

A challenge for DIUS and for my Ministers is ensuring that there is a coordinated approach for these key drivers of the knowledge economy.

We have a terrific research community – one of our best kept secrets. You are among the most efficient and productive in the world. Your discoveries benefit each one of us, every day of our lives.

And by advancing our understanding you’re helping secure economic, social and environmental well-being for all.

Our future prosperity lies in your hands.

Commitment to the Research Base

The Government's commitment to the country's research base is clear.

The settlement is good news for science and research.

This settlement maintains that commitment. It enables us to consolidate the progress we have made; and to prioritise spending on areas of national importance.

In total the Department will be spending almost £6bn on research by 2010-11. This is made up of the Science Budget allocation and of course some £2 billion of funding to reach universities in England through HEFCE's quality-related funding stream - the second leg of the dual support system.

The Science Budget will increase on average by 2.7% in real terms for each of the next three years. Every single Research Council has received an increase in its funding in real terms. At a time when overall government spending is tightly rationed this indicates the priority we attach to science.

The settlement allows us to take forward important projects and support key areas of research. There are sizeable increases in many areas over the next three years. With such a vigourous research sector, the number of excellent opportunities will could be pursued will always outweigh what is actually possible. Some challenging choices between priorities will be needed. But I have no doubt this investment will position to ensure the UK’s place as a leading country in the world of research.

UK Success

We remain second only to the US in global scientific excellence - as measured by citations - and we have a stronger performance across the range of scientific disciplines than most other countries. We retain our lead over all G8 countries on productivity measures.

So we are doing well, and you should all be proud of your contribution. Your efforts have helped transform the UK economy to one underpinned by knowledge and innovation.

However, it is important we continue the drive towards developing our knowledge economy. Countries from around the world – not just China and India – are fast developing their research capabilities.

To meet this challenge, we cannot afford to work in isolation. More than ever, UK researchers need to collaborate with scientists from across the world. Forging links with the best minds and cutting edge ideas.

I am impressed with the rapid development of RCUK’s network of international offices. I recently opened the new office in China, one opened last week in the United States; and one will shortly be opened in India.

I want the UK to be the partner of choice for international research collaboration. The new international fellowships – led by the National Academies - will take us towards that goal. They will help build sustainable networks with the best institutions and individuals abroad. They will attract outstanding researchers from around the world to the UK.

To meet future challenges we must make the most of our assets . The best way to do this is to work together.

• Research Councils working together, across the disciplines.
• Academics collaborating with business.
• Researchers interacting with their peers throughout the world.

Through such interactions, new innovative models of working are emerging. And I want these to be nurtured through government policies.

Unprecedented effort to tackle challenges

We currently face a set of major global challenges. We need to secure sustainable energy sources, tackle the changes that are occurring to our environment, and better understand the nature of the security threats facing our country.

We have to harness the potential of rapid technological change, and ensure we are well placed to capitalise on the opportunities of globalisation.

These are daunting challenges. They have made the Research Councils ask how we best organise research.

As a result, the Research Council are embarking on an exciting range of thematic research programmes, with a planned investment of almost £1.3bn.

The programmes bring together partners from inside and outside the research community. This is an unprecedented effort to tackle these issues.

The Life long health and wellbeing programme is helping to improve understanding of the ageing process and what can be done to keep people healthy throughout their lives. Recent advances include findings that may lead to better ways to treat Alzheimer’s, Parkinson’s, diabetes and strokes.

Living with environmental change is a research and policy programme examining the pressures on our natural resources, ecosystems, economic growth and social progress.

The Energy programme brings together energy-related research across the Councils to address the vital issues of climate change and security of energy supply.

And the global threats to security integrates research in crime, terrorism, environmental stress and global poverty.

There are two further multi-disciplinary programmes on nanoscience and the digital economy, which build on the existing work of the Research Councils.

These programmes are already starting to deliver technologies and ideas which will have a great impact. And I believe that with the support of this budget, there will be many more.

Supporting science

Of course, the key objective in allocating this Science Budget has been to support world class scientific endeavour and excellence.

The Science Budget funds a great diversity of research. From anthropology to astronomy; chemistry to cultural heritage; philosophy to particle physics. An exciting spectrum of subjects, generating a wealth of new ideas and discoveries.

Key disciplines - like systems biology and stem cell research - have received funding to ensure the UK leads the world developing these areas. The Science Budget also funds particular programmes such as NC3Rs to reduce the impact science has on animals.

We call this funding the “Science Budget”, but we should not forget the arts and humanities. I am pleased to say that Sir Alan Wilson has just agreed to be the new chair of the Arts and Humanities Research Council. Alan will bring enormous strength and experience to this role. [A formal announcement will follow shortly]. AHRC are undertaking interesting and important work. In particularly researchers are contributing to the cross-council programme on global threats to security. And have an important Knowledge Exchange Programme with the BBC, looking at how older people could take advantage of digital services.

It is also crucial that we have a flow of talented people into STEM subjects at university. This was one of the key themes of the Sainsbury Report. The Government has a strong commitment to this agenda. We have made significant progress, but I want to do more.

It is important that all research disciplines remain strong and vibrant. Research priorities will change over time, and a key element of the Haldane principle is that Ministers should leave these judgements to the research community expressed through the Research Councils.
However, I think that is important that, as Secretary of State, I am able to step back and assure myself that the combined decisions of the Research Councils properly underpin the health of key disciplines. This is important both for the future of research and, more widely, to ensure a flow of talented individuals into STEM subjects at University.

I have therefore asked Ian Diamond, as Chair of RCUK, to organise a series of reviews into the health of key disciplines, particularly those that rely on funding from several Research Councils. The first review will be on Physics – which plays a pivotal role in the STEM agenda. It will be led by Professor Bill Wakeham, Vice Chancellor of the University of Southampton, but involve many different organisations including no fewer than five Research Councils. This review will be independent and will draw on international expertise.

The budget also funds major scientific facilities and our international membership of key organisations such as CERN. I would particularly like to touch on our vision for two national state-of-the-art Science and Innovation Campuses – Daresbury and Harwell.

The Government is committed to developing both Harwell and Daresbury as major international centres of expertise in science and innovation.

Daresbury is being developed as a major new partnership between STFC, the NWDA, the private sector and universities. As a consequence of an independent review, the STFC has decided to wait for further research before taking a decision on the fourth generation light source. As this has been a key element in plans for the future of Daresbury, I am concerned that the decision should not put in question the Government's commitment to the future of Daresbury as a national and international science and innovation centre.

Sir Tom McKillop is currently chairing an independent review into the future of the Manchester City Region and the broader North West economy. I have therefore asked Tom McKillop and his team to look specifically at how Daresbury can continue to be a world leading centre for science and innovation and a major driver of the regional and national economy.

Harwell is being developed into a prime location for international R&D. It will be a scientific and high technology commercial cluster. And will provide the opportunity for the public sector to work alongside businesses exploiting research.

Medical Research

Medical Research has received a significant boost over the CSR period. Funding from the Science Budget totals almost £2bn over the three years. The Government has ambitious plans to improve the nation’s health. And this funding underpins this ambition.

This funding will continue to support fundamental research in the biomedical sciences. But it will also provide the resources to ensure this knowledge is effectively applied to health problems.

We shall shortly be hearing about the work being carried out by the MRC in greater detail.

However, I would like to touch on a new initiative co-funded by DIUS and the Department of Health. Again this shows how joining together improves our effectiveness.

The Office for the Strategic Co-ordination of Health Research – OSCHR – will speed up the translation of fundamental knowledge into clinical practice.

By bring together the research budgets in the NHS and the MRC, we will enable rapid advancements in the quality of health care received by patients throughout the National Health Service.

Last week the Prime Minister unveiled the vision for the new UK Centre for Medical Research and Innovation - a collaboration between the Medical Research Council, the Wellcome Trust, Cancer Research UK and University College London.

Today I am pleased to be able to announce that I have approved "in principle" funding for another major new medical research facility - the Medical Research Council's new Laboratory for Molecular Biology in Cambridge.

Research Councils UK has advised me that in the current prioritisation exercise LMB is their top priority and they do not expect any change to this position. The precise amount of funding to be provided out of the Large Facilities Capital Fund of the Science Budget will be confirmed once the formal business case has been completed.

The Energy Technologies Institute is another important development. This brings together the public and private sector in a 50:50 partnership with funding capability of up to £110m, for at least the next 10 years. The ETI provides us with an excellent example of new working methods where business and researchers work side by side.

Economic Impact

The ETI provides a good example of how we must continue to drive up the economic and social impact of fundamental, curiosity driven, research. We do this by fostering stronger links between the research base and its partners.

To keep the UK in the premier league, we must not only sustain research excellence, but extract every possible benefit from it.

This does not mean that I am trying to reach an old fashioned balance between pure and applied research. Far from it. I see no conflict between the two. Fundamental research is not threatened at all by this drive to increase economic impact.

For example, a reputation for excellent research attracts a wealth of inward investment to this country. Companies want to be close to our excellent research centres and the people they produce. And this investment has an important economic impact on the UK.

The research base also produces some extraordinary talented people, who are a huge economic asset for this country.

Some choose to move onto different types of work outside their research field. The City is welcoming physicists with open arms. The Institute of Physics understands the attraction of highly trained physicists to a range of commercial jobs. It supports this career path vigorously.

But the research base is also a source of new businesses. Since 2003, there have been 30 university spin-out companies floated on stock exchanges. These are valued at more than £1.5 billion.

So you can see that we are already getting huge benefits from research. But over the next few years we must excel.

The Research Councils have done splendid work on economic impact. The excellent Delivery Plans published today illustrate just how far we have progressed this agenda.

But I want us to raise our game even more. I really want to see our performance in delivering economic impact to reach the heights achieved in research excellence.

And to support this, I am funding knowledge transfer activities to the highest ever level. The Higher Education Innovation Fund will rise to £150m per annum by the end of this CSR period. This will help Universities develop the professional capability to undertake top quality knowledge transfer. Almost all institutions will see their level of formula funding increase – allowing expansion of knowledge transfer into new areas, and permitting career track positions for Knowledge Transfer professionals.

The PSRE fund will continue to support the commercialisation of public sector research. This fund already reaches a wide range of organisations, but we have encouraged an even wider range of Public Sector Research Establishments to apply – including those who do not currently make commercial use of their research.

Financial sustainability

Now, great minds need an environment which supports their endeavours. World class research requires a world class infrastructure. Our great ambition for research will only succeed if we continue to maintain a financially sustainable research base.

A top research infrastructure doesn’t just benefit researchers, staff and students. It also attracts higher levels of business collaboration.

We introduced SRIF to tackle a historic backlog in infrastructure spending. And I am pleased to say that SRIF has done its job. The backlog in investment has now been made good.

To help us shape the future agenda, DIUS has now commissioned a report to understand better the impact of past investment in research infrastructure.

But we must sustain this. And therefore I am pleased that a new capital fund to provide a permanent support for long-term investment to maintain and develop a modern research infrastructure is to be introduced over the next three years. DIUS will also provide funding for research infrastructure through the Higher Education budget and I expect the Education Departments in the Devolved Administration to contribute funding in their parts of the UK.

One of the “big ticket” items of the allocations was, of course, the funding of all research at 90% of full economic cost. This may not be the most exciting topic for discussion. Nonetheless it is vital. By paying the true cost of research, we are ensuring the long term future of our research base.

And I know that this matters to our researchers and universities. Anecdotally I hear that the UK is leading the way on funding sustainable research. We are no longer leaving problems for future generations of researchers. Instead we have a positive legacy.

Science and society

A final point

We need a society that is both enthused and excited by science. A society where the public understands the value of science and its applications. People need to feel confident about how scientists operate.

Nearly 50 years ago in C P Snow’s famous Rede lecture at Cambridge University he observed a growing chasm between what he described as the “two cultures”: the world of art and the world of science. His arguments remain relevant.

There are many challenges facing us - such as climate change – for which science will be instrumental in the finding of solutions. More than ever, therefore, sound policy in today’s society needs to be underpinned by a sound understanding of science among the general population.

There are therefore three key themes that I believe we must address:

• we need to drive up the supply of highly trained scientists and engineers;
• we must engage the public on how everyone can help us to respond to the major challenges we face over the next decade and beyond; and
• we need to spread scientific literacy in society more broadly – promoting an understanding of what science as an activity is, how it works and how it resolves differences in opinion.

A great deal of excellent work has been carried out to date, but more needs to be done. Underpinning this vital work is the need to refresh our science and society vision. Ian Pearson – Minister for Science – is taking forward this work in collaboration with a wide range of partners from inside and outside government. I know he would welcome your input.

Closing Remarks

These allocations will continue to support the full spectrum of excellent research and enable it to deliver a high level of economic impact. This will help to maintain the UK’s position as one of the most attractive locations in the world for science and innovation.

As you have heard the research base is planning to pool together to address some of the challenges which are of the greatest importance, not only to the people of this country, but to the whole world. And I want to assure you today that you will have every possible support from me as you go forward.