Dr Chloe Billing explores the Research and Development opportunities available to the West Midlands, the different funding strands for these and how the region can make the most of them.
The COVID-19 pandemic has created a time of uncertainty and posed significant challenges to research and innovation in the UK. This was discussed in my recent blog on the ‘impact of COVID-19 on innovation activities in the West Midlands’. As attention turns to plans for recovery and rebuilding the UK economy, there is an opportunity to ‘build back better’ with R&D at the heart of this strategy. The recent publication of the Research and Development (R&D) Roadmap, demonstrates the UK government’s commitment to this, as the roadmap sets out the UK’s future vision and ambition for science, research and innovation. This follows the Chancellor’s announcement in March to increase R&D investment to £22 billion a year by 2024.
The ‘headline’ proposals outlined in the R&D Roadmap, are as follows:
- Increase investment in research: embrace the idea that transformative research has a high chance of failure but can produce the greatest long-term rewards; nurture a diverse culture where people with a wide range of experiences and insights are confident to lead, participate and engage; review how we fund and assess discovery and applied research.
- Set up an Innovation Expert Group: to help review and improve how we support the whole innovation system, including strengthening the interactions between discovery research, applied research, innovation, commercialisation and deployment.
- Support entrepreneurs and start-ups: increase the flow of capital into firms carrying out R&D enabling them to scale up; ensure we have the best regulatory system to support research and development.
- R&D People and Culture Strategy: Attract, retain and develop the talented, diverse people and teams that are essential to delivering our vision; increase the attractiveness and sustainability of careers throughout the R&D workforce;
- Office for Talent: set up to take a new and proactive approach to attract and retain the most promising global science, research, and innovation talent to the UK.
- Contribution to our levelling up agenda: work collaboratively across the UK, fostering greater collaboration and networks between funders, researchers, practitioners, and civic leaders to embed a system that delivers stronger local economic benefits and improved quality of life outcomes from R&D.
- Provide long-term flexible investment into infrastructure and institutions. build on the UK’s system of universities, public sector research establishments, and other publicly funded laboratories, developing our large-scale infrastructure, facilities, resources, and services to make them world-leading.
- Strengthening R&D partnerships with emerging and developing countries: develop a new funding offer for collaboration to ensure the UK can further benefit from the opportunities of international scientific partnerships; if we do not associate to programmes such as Horizon Europe, we will meet any funding shortfalls and put in place alternative schemes.
Over the coming months, the proposals outlined in the Roadmap will develop into a comprehensive plan. This plan will work to strengthen the R&D capability of areas across the UK, including the West Midlands region. This blog outlines what the West Midlands region should expect from these plans and guides how to prepare for delivery.
An Interconnected System
Research and innovation rely on an interconnected system of universities, research institutes, government labs, charities, businesses, start-ups, entrepreneurs, and sources of funding. To support the R&D system in the West Midlands, it is essential to secure local access to funding, infrastructure, data, and networks. Additionally, regional policies must draw on a diverse range of voices and perspectives to make the most of existing strengths as well as addressing any weaknesses or gaps. The West Midlands ‘lite’ REAP team adheres to this principle, with representatives from Entrepreneurs, Risk Capital Providers, Corporates, Academia, and Governments all involved. The goal of the MIT REAP-UK Initiative is to develop an evidence-based approach to supporting innovation and entrepreneurship in the West Midlands. This is part of the ‘lite’ version of a global ‘Regional Entrepreneurship Acceleration Programme’ (REAP), aimed at helping UK regions with achieving greater productivity, employment and returns from research
The Role of Universities and Colleges
Universities have an important role to play in the R&D system by allowing researchers the freedom to test radical new ideas, tackle complex societal problems, and to form new connections, collaborations, and networks. Colleges also have a crucial role to play in delivering high quality education for technicians and relevant training modules for the existing workforce. To expand the region’s future R&D capacity, it is important that universities and colleges work together to understand the future skills needs of different businesses and sectoral specialisms. However, this is dependent on “institutions where research will be carried out, well-equipped research facilities, and a supply of skilled people, technicians, researchers and support staff” (NESTA, 2020). Furthermore, research has found there to be insufficient available funding for truly transformational opportunities, alongside other barriers to interdisciplinary research. Constrained resources require researchers to spend excessive time competing for funding, sometimes focussing on ‘safe’ research topics rather than bold new ideas that can have the greatest long-range impacts on knowledge and society. The region needs to identify ways to support and sustain more radial research activity, as well as, strengthen the relationships between colleges and universities.
Barriers to Commercialisation
The Industrial Strategy Green Paper (2017) highlighted that whilst the UK ranks first in many key global measures of research quality; in terms of intellectual property income generated against research resources and the number of successful spin-off companies the UK performs far behind US institutions. This is a symptom of the UK ‘university-industry gap’ that limits the adoption and diffusion of university research into commercial ideas, which can be brought to market. WM-REDI research has identified a range of factors that affect the commercialisation of university research, including the disconnect between academic goals and commercialisation activities; regulation; and gaps in seed funding and investment. Targeted policies are needed to help universities overcome these barriers and accelerate the journey between concept and commercial application Furthermore, “commercial and entrepreneurial skills and a mindset of enterprise and innovation are important across all academic disciplines to effectively leverage R&D investments” (Roadmap, 2020).
Thinking Local and Global
A priority for the Roadmap is for funding to unlock opportunities tailored around local economic strengths in more places. Therefore, the West Midlands must work to understand its regional strengths and promote itself as a promising regional R&D cluster. First, the region must build consensus amongst stakeholders on their unique assets, capabilities, and comparative advantages. One route would be to develop a set of indicators to assess the region’s capability to support Innovation and Entrepreneurship in the region. This has been the approach by the MIT REAP West Midlands team, who have identified a set of indicators relating to human capital, funding, infrastructure, demand culture, and incentives. WM-REDI are now leading on pairing them indicators with regional and national datasets as a form of assessment. This work will all feed into promoting the West Midlands R&D strengths and further support the WMCA’s Office for Data Analytics (ODA) vision to provide “integrated intelligence to support decision making in the region on a range of economic and social issues”. The R&D roadmap also stresses the need to ‘think globally, as international collaboration is at the forefront of cutting-edge research and innovation. Therefore, it is important for the region to develop strong international partnerships with a range of countries and continue to attract global talent.
Private sector investment will continue to be important
In addition to the increased Government expenditure on R&D, the Roadmap stresses the importance of continued private sector investment. In 2018 for example, £25 billion was invested by the business community, which accounted for over two-thirds of all R&D funding. The West Midlands is well placed to continue with this trend, as it is a ‘business-led innovation region’ with above-average levels of business investment (NESTA, 2020). However, the region must work hard to match its private sector investment with public sector investment, as otherwise, the danger is that the private sector will respond by relocating their own investment. In recent years, private-sector R&D per head in the West Midlands has grown by more than in Paris and London put together, and yet public sector R&D has remained static. Research published by UKRI in 2020 shows that the so-called ‘Golden Triangle’ benefits disproportionately from public investment, compared with other regions of the UK. The headline stat is that 52% of gross domestic expenditure on R&D (GERD) goes to London, the South East, and East of England regions (ONS, 2020). In 2018-19, the West Midlands received only 9%. (ONS, 2020).
This blog was written by Dr Chloe Billing, Research Fellow, University of Birmingham.
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The views expressed in this analysis post are those of the authors and not necessarily those of City-REDI / WM REDI, University of Birmingham.