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My Lords, ladies and gentlemen, may I start by thanking you for the
opportunity to say a few words at this lunch today, and to thank Lord
Wade and APAX Partners for organising and hosting the event.
These are exciting and challenging times for the whole Information
and Communication Technology arena. The UK has key business and academic
strengths in it, and I believe the Government has a clear role to play
in
creating the best possible conditions to help British companies
innovate.
For some time Government has recognized that this 'new style'
industry needs new style partnerships for it to flourish. The
Information Age Partnership, which is chaired by Patricia Hewitt and has
a cross sectoral membership, ensures a much closer integration between
hardware design, software and manufacturing. This has stimulated
important work on skills, R&D, broadband and promotion of e-business
and e-government. I am pleased to see that David Jordan, the Chairman of
the IAPs Executive Committee is here today.
This gathering comes at a very opportune time, as we are considering
how to take forward the issues raised in the House of Lords Select
Committee's report.
The report highlights just how pivotal electronics design is to
future growth and it is therefore important to recognise that the UK has
particular strengths in this area. We are Europe's No.1 for independent
semiconductor design, with some 40% of the design houses and 40% of the
revenue. We are strong in the emerging Systems-on-Chip technology. We
have Europe's largest chipless company in Sir Robin Saxby's ARM. We have
significant fabless suppliers such as Wolfson Microelectronics, which
has just undertaken a successful floatation. Companies like TTPCom and
Cambridge Silicon Radio are leading the world in new and exciting
technologies for third generation mobile communications. The large
design centres of ST Microelectronics, Philips and other inward
investors highlights that UK is a "good place to do design".
Innovation and management of complexity have long been great strengths
of UK engineering. These strengths are harnessed in areas like systems
on chip technology and electronics design more generally. This is a UK
success story.
Nor should we overlook the strength of the UK's science and
engineering base. The Engineering and Physical Sciences Research Council
already has a broad research portfolio in this area totaling some £120
million. We are justifiably proud of facilities such as the three - five
(III-V) semiconductor facility at Sheffield University and our centers
of excellence at Cambridge and Birmingham Universities. The transfer of
knowledge from these institutes has been a priority and I am pleased to
note that the statistics now show an improving situation.
In addition we have recently announced £90 million to be spent on
collaborative research and a new network of micro and nanotechnology
facilities. Because of the wide-ranging scope of micro and
nanotechnologies we asked industry and academe to submit expressions of
interest in the Collaborative R&D initiative and I am delighted by
the response. Over 600 project ideas worth over £300 million were
submitted with very strong partnerships between companies and the
science base coming through. Our Devolved Administrations in Scotland,
Wales and Northern Ireland, together with all of the Regional
Development Agencies in England are also currently looking for proposals
for the new National Network of facilities and I expect a similarly
strong response. This will help business build on the UK's excellent
scientific track record in the small-scale sciences and win a share of
this developing global market.
The "Chips for Everything" report has identified some
important challenges and suggested some ways of tackling them and we
have been in recent discussions with Lord Wade and others about how we
might make further progress. There is no disagreement between us on the
importance of semiconductor design, but there are of very different
schools of thought on how we should address the challenge of harnessing
our capabilities most effectively. There are some who look enviously at
large scale centres in other parts of the world. There are others who
say we shouldn't waste money on buildings, all we need is networking. My
own feeling is that we need something between the two - a hub and spoke
arrangement, with strong leadership and strong business focus that uses
superlative knowledge sharing and networking to lever the best of our
capabilities.
The Report also highlights the pervasive role of semiconductors and
electronics design in other industries. This presents a challenge of
networking and collaboration, across industries and across technologies
that existing structures may not always address effectively. I am
therefore grateful to Sir Robin Saxby, in his capacity as Chairman of
the IEE IT Sector Panel, for agreeing to pull together a team of
business and academic players to explore, in just one application area,
the issues involved. Robin has agreed to take secure communications as
the example. His team will be asking itself:
- Just what needs to be done to identify the challenges flowing from
increased demand for secure communications and pervasive computing?
- How does the business and research community come together in this
space?
- How do the hardware and software communities interact?
- What will the implications be for design, verification and
validation in this new multidisciplinary world?
- Do we have the right infrastructure to support business and
research in this area?
- What Intellectual Property issues arise?
- What are the implications for skills?
- How do we intercept the global opportunities and challenges in
this area?
The skills shortage is another challenge identified by the Report and
one that we have already taken some steps to address. The Government is
committed, in response to the Roberts Review, to create one thousand new
academic fellowships to facilitate the progress of contract researchers
into academic jobs. We have also announced the increase in post-doctoral
salaries by £4000 per annum by 2005/06. Specific initiatives for the
sector include the EPSRC Engineering Doctorate programme for System On
Chip technologies. The recently published Skills Strategy has also
recognized the need for a more demand side approach to our skills
provision. The new Sector Skills Councils will be agreeing Sector Skills
Agreements. It will therefore be important that they start to interface
with the Electronics Design community in its widest sense in order to
build the workforce capabilities for these emerging opportunities.
It is also important to bear in mind that the Chips for Everything
report will influence our thinking in other broader initiatives.
One such initiative is the Electronics Innovation and Growth team,
which
We have set up to evaluate the key factors that will impact on an
industry globally and identify the opportunities and challenges for the
UK. It has already started its work in earnest and it is good to see
some of the active participants in that exercise are here today. By June
next year we hope to have a shared road-map for a viable and flourishing
electronics industry in the UK, that will reflect global, social,
economic and technical challenges and opportunities for the industry in
the next 5 - 10 years.
Against this backdrop, I very much look forward to hearing the views
of those gathered here. A great deal of thinking has been going on, and
we need now to pull it together and take some action.
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