Opinion: A lack of leadership on public R&D spending

 

Analysis from the Science is Vital campaign has been released with the worrying news that UK public sector spending on research and development has dropped to less than 0.5% of GDP.

Not only does the decline in investment put us at the bottom of the G8 group of countries, but it’s less than any G8 country has invested in R&D in the last 20 years.”

This is also less than the EU average, and the OECD average for public R&D spending. Science is Vital argue that this is a result of a flat cash settlement in 2010, cuts in capital expenditure, and significant reductions in departmental spending on research. The campaign for science and engineering (CaSE) have echoed this with an estimate that “The cumulative erosion of the ringfenced science budget will be over £1.1bn from the beginning of 2010 spending review period up to 2015/16.”

Of course the Government, if not the average politician, are aware of this, as a paper produced within the Department of Business, Innovation and Skills acknowledged –

Public sector support for innovation is harder to compare, but such data as exists suggest that UK funding is very low.” The total investment in R&D (public, private and charities) is also lower than our international competitors.

All this makes our pre-manifesto promise to ringfence the science budget look embarrassingly inadequate. As Aldes pointed out at the time, we should look to the policies passed at conference in 2012 and argue for a 3% increase above inflation, year on year, of both the research and capital science budget for the next 15 years. Now that’s a policy worthy of our party.

The obvious counter-argument to this is that we can’t afford it, which is just nonsense. We can’t afford not to. We can’t compete globally on low tech manufacturing, we need a healthy research and innovation environment to develop a competitive economy with well paying jobs. There is increasing evidence that public R&D investment not only boosts productivity, it also draws in more private sector R&D investment. Estimates vary on the returns from R&D investment, as might be expected for a term that encompasses many varied activities, but direct and spillover benefits are significant. The Wellcome trust estimated that spending on cancer research, returns 40% year on year to the UK.

I may be being overly cynical, but I guess politicians are reluctant to commit significant amounts of public money on something without an obvious electoral payoff. When was the last time you heard a memorable speech on science from a top politician? If you weren’t alive for JFK talking about going to the moon, or Wilson’s white heat of the technological revolution, the answer is probably never. The excellent dictionary of liberal quotations has as many references to mackerel as it does to science.

Interestingly, public opinion on science is really positive. The Public Attitude to Science survey (Ipsos MORI, 2014) showed that, even in difficult times, the public strongly support scientific research. Government funding of scientific research was supported by 79% of respondents, 76% agreed that this makes a direct contribution to the economy and 81% agreed the UK needs to develop its science and technology sector in order to enhance its international competitiveness.

We have a policy that the public support, pays for itself (in time) and would help us regain our reputation as a forward thinking, and ambitious party. I think we should show some leadership on this before someone else does.

* Tad Jones is a Liberal Democrat member in Nottingham and a member of ALDES. He writes in a personal capacity.

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8 Comments

  • Unfortunately lack of investment in R&D is one of the UK’s biggest own goals.

    As the survey quoted above says, most people want to see a strong science and technology sector and understand that this will make us all better off by strengthening the economy.

    But both the UK public and private sectors seem unwilling to invest, even when they acknowledge that such research is essential. It seems to be a cultural problem – as a country we seem to have given up on the future.

  • Richard Sangster 17th Mar '15 - 7:55am

    I get the impression that the EU is more supportive of Research and Development than the UK Government is. Another reason for not leaving the EU!

  • Alex Sabine 17th Mar '15 - 8:15pm

    Richard: No, the opportunity to implement policies by the back door that Parliament and the British electorate are unwilling to vote for or finance would be a bad reason to stay in the EU. Nick Clegg cogently explained the dangers of this approach with reference to EU social and employment policies in his chapter advocating EU reform in the Orange Book – tackling arguments from left-wing pro-Europeans that the EU was a means to entrench ‘progressive’ measures that domestic governments would not otherwise pursue.

    Clegg wrote: “In the absence of a European demos, it must be accepted that the primary source of meaningful political legitimacy in the EU remains the nation state, at least for the foreseeable future.

    “…In those member states, such as Britain, with a tradition of loose social and labour-market regulation, there is a widespread feeling that the EU can be relied upon to introduce progressive social legislation which otherwise would not be adopted by domestic governments… As for those who look to the EU to do their bidding in social policy in the face of domestic political reluctance, the danger is an obvious one. Whilst it is, of course, entirely reasonable to support EU measures because of their beneficial effects…doing so in order to supplant the normal domestic policy-making process risks undermining the basic tenets of democratic accountability.

    “If the EU were to be used systematically as a means to bypass domestic political debate, voters will be even more perplexed about who is responsible for what, and EU institutions will foolishly arrogate to themselves a political role that should be the preserve of elected national governments.”

    He rightly concluded that the case for such legislation must be argued on the merits, and the EU should only be involved where there was a clear (rather than a specious) cross-border justification.

  • Alex Sabine 17th Mar '15 - 8:50pm

    Tad: Thanks for this, an interesting piece. You are of course right to allude to the fact that ‘ringfencing’ seems to mean different things in connection with different budgets. In the NHS it is taken to mean holding the budget constant in real terms, which is broadly what the coalition has done in this Parliament (in fact there has been a modest real-terms increase due to lower than expected inflation in the recent period). In the current debate about the defence budget, a number of people are using the term ‘ringfence’ as a shorthand for holding spending constant as a proportion of the economy, at 2% of GDP. This ambiyion means something different, and requires real-terms funding increases in line with the growth rate of the economy, of say 2% yo 3% per annum. Meanwhile George Osborne, Vince Cable and others have used the term ‘protecting’ or ‘ringfencing’ the science budget to describe a flat-cash settlement, which equates to modest real-terms cuts. Where the welfare budget is concerned it means something different again: ‘cuts’ can represent a change in the indexation procedure from earnings to inflation, for example, or in the measure of inflation from increasingly discredited RPI to the more stingy CPI. In essence a ‘cut’ seems to be simply a departure from the previous policy ‘baseline’. And the pensions ‘triple lock’ is described as ‘ringfencing’ when it is formula that tends to generate real increases in the value – and the cost – of the state pension. So the terminology and conventions are, whether deliberately or not, pretty confusing and inconsistent.

    You make a strong case for the science budget and public R&D investment. This is one of the few areas of industrial policy where I believe public subsidy has a useful role to play. Basic research is, in economic jargon, a classic ‘public good’. I don’t think arguments about affordability can simply be waved away with the assertion that “we can’t afford not to”: you may well be right that a 3% pa increase is no more than a commonsense investment that will boost the economy’s productivity, but all public spending nonetheless has to be paid for, either by today’s taxpayers or by future taxpayers. R&D will have to jostle with all those other areas which politicians are busily ringfencing and boosting while seemingly remaining committed to an overall spending squeeze and significant personal tax cuts. But you make some powerful arguments for putting it near the front of the queue.

    I wouldn’t set too much store by the claim that the public support it, however. The same results could be ‘discovered’ for most areas of public spending (except perhaps our net contribution to the EU and overseas aid) and for most tax cuts (except the top income tax rate and taxes on non-doms etc) if the polling question is worded in the right way. Unfortunately the majority of voters tend to be innocent of the need to trade off competing desirable objectives within a finite overall budget, and the polling questions rarely confront them with a direct choice between (say) higher spending on R&D and lower spending on (say) the NHS or policing or pensions or whatever. Hopefully you are right that they put a priority on things like medical research, but I suspect there would be other – less obviously worthy but still important – parts of the research budget that they would happily sacrifice if push came to shove.

  • Philip Thomas 17th Mar '15 - 9:53pm

    Surely political legitimacy comes from the people of Europe, of which the various European institutions (including those regional governing bodies known as “nation states”) are but an imperfect reflection?

  • Alex Sabine 18th Mar '15 - 4:18am

    Philip: Well I’m not sure I’d accept the description of nation states as ‘regional governing bodies’, but again, I can’t fault your ethical individualism (or is it methodological, it’s a while since I studied philosophy…). Public policy needs to be grounded in the experiences of individuals who alone feel, think, suffer and rejoice. Governments at whatever level are merely workaday organisations to provide those services which are better secured by collective action than by either the profit motive or by voluntary cooperation. Some of the worst atrocities in history have been committed in the name of abstract entities, including, of course, the nation.

    Nick Clegg’s point was that there isn’t a European demos, as the unfolding eurozone crisis has since amply demonstrated. The ‘nation state’ and the ‘national interest’ are convenient portmanteau terms which reflect the reality of identifiable political allegiances, and arguably the most distant level at which political power can be exercised with an acceptable degree of legitimacy and accountability. By extension, you could also interpret his remark as meaning the nation states would/should continue to have the key role within the EU institutions (ie the Council of Ministers).

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