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"Science is vital for our future"

The Rt. Hon. Alistair Darling MP,  Former Secretary of State for Trade and Industry
Royal Society, London,  23 October 2006

I very much welcome the opportunity to talk to you this evening.

Science is vital for our future.

And we have a lot to be proud of.

And I am pleased to be here not least because, of the Department of Trade and Industry’s budget, over half - £3.5 billion - goes to Science and Innovation. And so it should.

This sum has doubled over the past nine years and it will increase again over the years to come. We’ve chosen to spend that money because we believe that it is necessary for our country’s future.

In the global economy in which we now live we will only prosper if we are at the forefront of innovation and invention.

And we are a nation of inventors. From Harrison’s chronometer to Faraday’s electric motor, Bell’s telephone to Logie Baird’s television, British science and innovation has changed the way we see the modern world.

And, at the same time, it has changed our economy.

For example, thanks to collaboration between the University of Nottingham and British music firm EMI, there are now more than 20,000 MRI scanners around the world, providing more than 60 million scans every year.

In the 1970s, British researchers developed environmentally friendlier insecticides. Today, these compounds account for 17 per cent of global insecticide sales – a market worth more than $7 billion a year.

And we have just announced an £800,000 investment in a pioneering rapid response device being developed by Cambridge-based nanotechnology firm Akubio, (PRONUNCIATION CHECKED) to fight malaria and meningitis.

This evening I want to emphasise the importance of science and innovation to our economy and our society. Its importance cannot be over estimated for our future prosperity.

We’re living in a time of massive change across the world. And this change is happening on a timescale we could hardly imagine even ten years ago.

Globalisation can, if we don’t make the right response, brings uncertainty and insecurity.

Remember this, China is now producing 70 per cent of the world’s photocopiers, 50 per cent of cameras and 25 per cent of textiles. And at wages that are just five per cent of ours.

But globalisation can also bring huge opportunities provided we are ready to seize them. We can’t compete on low wages and or low skills, and nor should we. But we can and must compete on quality and excellence. And particularly on our ability to innovate.

And remember too that China and India may be producing photocopiers today but they want to be where we are – researching and developing tomorrow’s technology.

So the challenge is there. And we are well placed to meet it.

We lead Europe in knowledge-based and high-tech businesses.

Knowledge-based business services have accounted for over half of our job growth in the past two decades. And our successful software and computer industries have underpinned growth in both our services and creative industry sectors.

A fifth of the world’s current top selling medicines were discovered and developed in the UK. Bringing new cancer treatments and gene therapies to hundreds of millions of people worldwide.

In aerospace, shaping the design and manufacture of the next generation, supporting over 270,000 jobs across the UK economy.

The satellite and space industry, alone, has grown by 17% in last two years.

We are good at engineering. We should shout about it more.

Our record of scientific discovery is one of the best in the world underpinning our future prosperity.

With just one per cent of the world’s population, we produce nine per cent of all scientific papers and receive 12 per cent of all citations, including 13 per cent of the most highly cited ones. We are also ranked first in terms of papers and citations per head in the G7.

But being good at science is just the start. It’s what you do with it that matters.

If we are to truly compete in the global economy, then we need to do more to transfer knowledge from the laboratory to the market place.

And today’s scientists are becoming partners to business, devising new and more productive ways of working, to take discoveries off the drawing board and onto the shop shelves.

In the coming years, the countries that will prosper will be those that can compete not just on intellectual strength but on high technology.

Those that can attract the highest-skilled people. Who have the potential to innovate. And, most importantly, those that can turn that good science into good commercial opportunity.

That’s where government will focus its resources in the future. Driving on initiatives like Higher Education Innovation Fund and the Technology Strategy Board.

HEIF provides £110 million a year to universities, to help them to develop links between their research base and business. Such has been its success in the last three years alone, 25 university spin-out companies – now valued at £1.5 billion - have been floated on the stock market. A great return on our investment. And a great result for British research.

The Technology Strategy Board brings business firmly into the decision making process to identify those technology areas where the UK is able to create competitive advantage in a global market.

Since it was established two years ago we have supported over 500 collaborative R&D projects backed by £600 million investment from government and industry.

And 20 Knowledge Transfer Networks are being supported to bring together science and business communities. Making the connections necessary to innovate in these key technology areas.

And the Technology Board is starting to work with government departments to develop technologies to meet the public policy demands of the future, enabling government procurement to drive innovation in the economy and deliver better value for money for the tax payer.

We have brought scientific advancement to the heart of government.

It has helped us highlight clusters of technologies where it is expected that there will be important developments in the next decade – developments where we have the opportunity to shape our economic future.

Nanotechnologies which could revolutionise engineering; Energy, which will lead to the production of greener, more efficient energy and power sources such as wind turbines and hybrid engines for vehicles; Sensors and Tracking which will lead to advanced cameras, radio-frequency identification devices and Knowledge Management which will change the already rapidly changing world of IT, data storage and digital rights management systems.

These are all areas where science and business can work in partnership and where we can lead.

But we’ve still got to do more to translate our outstanding ability to invent into goods and services we can sell.

Ten years ago, it used to be a national sport to beat ourselves up about the poor exploitation of research – good at science, but don’t reap the rewards. And there was some truth in it. Most people in this room could think of an example. The world’s first computer was developed in Manchester. Where was it exploited?

But we have seen one of the greatest transformations over the last decade.

Because universities are now far better at turning an idea into a commercial success. In the last few weeks I’ve visited Glasgow, Southampton and York universities. They’re developing networks with other universities and businesses. They, like so many others, are focused on the commercial development of their research.

Back in 1997, we looked to the USA, who’d had been taking the lead in championing links between science and business for 20 years.

Now, some of our top UK universities are catching up with the best in the US. Comparisons show that UK universities produce roughly equivalent number of patents as their US counterparts and also produce a far higher number of spin outs per £1 million of research. And there are many examples.

Bath University developed an automotive research facility, sponsored by DTI and led by the Ford Motor Company and British Petroleum. It is developing better lubricant oil to improve fuel consumption resulting in cleaner and more environmentally friendly vehicles.

Wolfson Microelectronics from Edinburgh University, in my own constituency, whose audio and imaging technologies can be found in mobile phones and MP3 players.

And Ceres Power who are bringing to the market over 10 years of fuel cell research from Imperial College in London.

The Financial Times commented earlier this summer: “The days when critics could bemoan the country’s failure to cash in on its world-class research base may be drawing to a close”.

But all that is still not enough. Because across the world other countries are catching up.

So if this progress is to continue, it is first of all vital to continue to fund universities and research in science and innovation. Here at home, we need to continue to make good past underinvestment in our science base.

In 1997, the science budget was just £1.3 billion. By 2008, it will have more than doubled in real terms.

We have invested over £3 billion for the renewal of scientific facilities in universities after years of no investment where scientists were working in poor buildings, with out of date equipment.

But we have set up a 15-year roadmap for large facilities so that we can provide our world-class scientists with a world-class infrastructure.

And, as a result of the enterprise schemes we have introduced, 24,000 science and engineering students are receiving enterprise training to help develop business skills for the future. In 1998, the figure was just 3,000.

We have also introduced Research and Development tax credits for small and large companies to incentivise them to do more research. These are now worth £1.8 billion to our 22,000 businesses so far, from large manufacturing firms like Rolls Royce to recent bio-tech start-ups like ARK Pharmaceuticals. I believe it would be a huge mistake to abolish tax credits, as some are now suggesting.

Our investment is not for short-term payback. The money often takes years to feed through. But, when it does, the rewards are huge.

Our success tomorrow, in science and business in the global economy, depends on unleashing our creativity today.

So we must continue to invest in research and education. In the next few months we will decide how much to spend on science and innovation – as part of the Spending Review – in the years to 2011.

And there is a choice. Some say we don’t need to spend more. We believe that we do – because it is vital to our economic interest to do so.

China and India are turning out 5 million graduates a year in Engineering, Science and Technology.

That is the competition.

The number of science undergraduates in the UK has gone up by a quarter since 1997. But it is not enough. They are in high demand from all sectors of our economy and we need to do more to encourage students to study science.

We are making science a priority in schools. From 2007, we will boost the percentage of pupils who get two or more good GCSEs in science.

From 2008, all pupils who perform well in science at Key Stage 3 will be entitled to study three separate science GCSEs.

We are stepping up the recruitment and retention of physics, chemistry and mathematics specialists, so that, by 2014, more classes are taught by good teachers.

And from this year we are piloting 250 after-school science and engineering clubs to enthuse 11-14 year olds with a real interest and potential in science. Our future Flemings and our burgeoning Brunels.

So adequate funding and more encouragement to study science are essential. But we also must do more to be at the centre of global scientific excellence and innovation.

The government’s Global Science and Innovation Forum Strategy, which is published today, sets out our strategy for the UK to be a key hub in the knowledge economy. To be the first choice for business investment in R&D, and for foreign universities and scientists wanting to be at the heart of world class research.

We will be creating stronger international ties with China and India by extending our UK/US Science Bridges schemes to them – bringing together key scientists and researchers from both countries to solve problems together.

I will be opening the first international UK Research Council office when I visit Beijing next month and we hope to open more in other key countries.

UK science always has been a tremendous force for good in the world. And been at the forefront of some of the most important medical, technological and engineering discoveries that have changed the world.

We should always celebrate it. And let’s name a few:

· Watson and Crick – DNA – the very life blood of all living beings developed at Cambridge University
· Vaccine for Hepatitis B – developed at Edinburgh University
· The birth of aero-acoustics – Imperial College and Cambridge University
· Fibre optics – developed at Imperial College and Southampton University

We have world leading science research universities – Cambridge, Oxford and Imperial College. Britain has three universities in the world top ten, eight on the top fifty. Britain has the top four universities in Europe. In all, Britain as 29 universities in the top 200, up from 23 last year.

UK scientists have transformed our world.

Science, and biotechnology, is not just our key to surviving in the world economy, it is the key to our survival.

Scientific advance means life expectancy has doubled in the last 200 years.

Smallpox has already been eradicated. Polio soon will be.

Measles and meningitis are no longer the threats to life they once were.

Telecoms and the internet have not just transformed communications in the developed world but in some of the remotest and poorest parts of the globe. Enabling poor African farmers to develop their markets.

And there is more to be done. Stem cell research, for example, has tremendous potential to benefit patients with conditions that currently have no effective cure. From juvenile diabetes to Parkinson’s and Alzheimer’s, to spinal cord injury.

The US Government has blocked federal funding for stem cell research. It may not be welcome there but stem cell research IS welcome in the UK. With your courage and skills, and our financial backing, we can ensure that the UK remains at the forefront of this area.

The UK Stem Cell Initiative report, published last year, provides a clear vision for maintaining our position as a world leader in research and provides a path to translate this research into new therapies to benefit patients. This includes £100 million government funding over the next two years.

So we have the challenge ahead. Science has been one of Britain's best kept secrets. I want to change that.
We have the expertise, the will to convert science into opportunity. But key to this is another factor. The critical mass of people. Scientists. Academics. Design people. Finance.

To be the best you need to work with the best. And to encourage scientific and academic exchange, together with the Royal Society, I am pleased to announce an innovation.

The Chancellor earlier this year announced that we would discuss with The Royal Society setting up a new fellowship and alumni scheme.

To build stronger ties between the next generation of world class scientists and the UK. Enabling the very ones from around the world who will be making the future great discoveries to build those essential connections in the UK.

I am delighted to announce that the Government is to work with the Royal Society to establish a new, high profile, prestigious international fellowship and alumni scheme to firmly establish the UK as "partner of choice" for scientific collaboration in the twenty first century.

Building on existing investment of around £100 million in Fellowships - that already attract the best and the brightest scientific minds in the world to the UK to do research - this new scheme aims to attract the best in science to Britain. It will push our world-class science base further and help give us a business edge.

Like the Rhodes Scholarship has done in other areas, I hope that the new scheme will become a sought-after badge of honour for upwardly-mobile scientists and a must-have for the CVs of our future scientific leaders.

And there is no-one better placed than The Royal Society – with its history and international reputation – to manage this new scheme for Britain.

Where once science expanded our horizons, from British shores to the New World, innovations from air travel to email and Skype are now shrinking our world.

Globalisation is the challenge. The response is, to borrow a familiar slogan, the "appliance of science".

Because it’s good for Britain. And because Britain happens to be very good at it too.