UK Government innovation strategy


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On 22 July 2021, the Department for Business, Energy and Industrial Strategy launched the UK Government's Innovation Strategy – a first in 15 years.

Forming part of the 'Build Back Better' plan for growth, published earlier this year, the Innovation Strategy sets out the Government's commitment to strengthening the UK’s position as a world leader in science, research and innovation.

Whilst the strategy announces that annual public investment on Research and Development is set to increase to a record £22 billion, it is anticipated that continued private sector collaboration will also play a crucial role in boosting expenditure in this key area, in order to fuel innovation and future-proof the country's economy in its post-pandemic recovery period.

The Innovation Strategy details how the Government will look to address skills gaps preventing businesses from realising their innovation potential.

Some key interventions include:

  • Launch of the second project of the Emerging Skills Programme
  • Continued exploration of the ways in which the Skills Value Chain could be embraced by Government and the innovation ecosystem
  • Strengthening Innovate UK’s role in the development of skills to ensure it plays a key part so in addressing emerging skills gaps

Additionally, the document identifies challenges faced in the UK's innovation landscape and recognises significant change on the horizon, in the context of our departure from the EU, seismic economic disruption caused by Covid-19, a climate emergency and the rapidly increasing pace of, and competition in, technological innovation.

It outlines a broad aim to establish the UK as a global hub for innovation by 2035, with plans centred on four key pillars:

  1. Unleashing Business – supporting those businesses seeking to innovate.

    In recognising the importance of providing support to businesses in navigating the UK's R&D funding system, the Government has signalled its intent to crowd-in additional investment in innovation where there are gaps in private markets and will continue to work in collaboration with key delivery partners the Innovate UK and the British Business Bank, to facilitate access to funding and venture capital for innovative SMEs across the country. Details of the financial programmes offered by the British Business Bank are helpfully set out in the strategy document.

    Other key strands of the strategy's first pillar focus on delivering an 'infrastructure revolution' in an effort to level-up across the country and, through continued roll-out of wide-ranging digital infrastructure programmes nationwide, ensure the UK is at the forefront of global 5G innovation. Of particular interest in the tech sector will be the announcement of a forthcoming consultation 'on the potential value of and options for a UK capability in digital twinning and wider ‘cyber-physical infrastructure’ to help unleash innovation'.

    Efforts are to be made to improve regulatory regimes in order to facilitate growth and there will be a consultation on, and the Regulatory Horizon Council will be commissioned to establish, the ways in which regulation can support UK innovation, and whether a high-level set of guiding principles could be broadly implemented across innovation sectors. In addition, the Government will:

    • Extend the 'Agile Nations' network by engaging with more countries
    • Publish a joint Action Plan on Standards for the Fourth Industrial Revolution
    • Publish the UK Measurement Strategy this summer
  2. People – attracting and encouraging innovation talent to come to the UK.

    Under this pillar, the strategy aims to set out how the Government will assist businesses to acquire the skills needed to develop workforces, as well as attracting and retaining global talent.

    Proposals in this area include ensuring the UK's skills pipeline covers the skills needed to complement the country's innovation landscape and, specifically, refocussing on programming, technical and engineering fields.

    Additionally, there are indications of reform to the UK's migration system in order to attract world-leading innovators. The strategy announces the creation of a dedicated cross-departmental unit, the Office for Talent, which aims to drive a proactive approach to bringing talent to the UK.

    Further, and building on its previous promises to provide an unsponsored work route under the Points Based Immigration System for business visas,  the Government intends to introduce a new 'High Potential Individual' visa route (no job offer required) in an effort to make it as simple as possible for internationally mobile individuals demonstrating high potential to come to the UK. Other proposed changes include introducing a 'scale-up route', for individuals with a high-skilled job offer from a qualifying scale-up to come to the UK, and a revitalised 'Innovator route' under which talented innovators and entrepreneurs can  come to the UK and start and operate a business, which is either venture-backed or harnesses innovative technologies. It is expected that comprehensive terms and conditions will accompany a statement of changes to the Immigration Rules in due course.

  3. Institutions and Places – ensuring innovation institutions serve the needs of UK businesses and places.

    Under this pillar, focus is placed on the diversity of structures and institutions in the UK's innovation landscape. It highlights the creation of the UK Advanced Research and Invention Agency (ARIA), modelled on the USA's DARPA. It is hoped that ARIA will help drive the pull-through of innovations to address societal issues and fill gaps in the UK's research system, by empowering programme managers to exercise their judgement and take risks on technologies which are unlikely to be pursued by current agencies.

    Whilst acknowledging that the UK has a vibrant mix of innovation institutions, including world-class universities, the strategy notes that business are not often aware of the innovation support that is available, or most appropriate, for them. As such, the Government is to focus on ways to simply navigation of, and interaction with, the UKRI for business which will include undertaking an independent review, led by Nobel Laureate Professor Sir Paul Nurse, Director of the Francis Crick Institute, to evaluate UK organisations involved in all forms of research, development and innovation. It is anticipated that this review will highlight strengths to be encouraged and any weaknesses to be addressed, and make positive recommendations.

  4. Missions and Technologies – tackling major challenges faced in the UK by stimulating innovation and increasing strategic technology capabilities.

Under this pillar, the strategy sets out a range of 'Innovation Missions' and which are to focus on a selection of the Government's foremost policy priorities. Separately, there is also the announcement of seven new technology families, which the Government will target with additional support to establish UK leadership in those key strategic areas.

The seven technology families will include:

  1. Advanced Materials and Manufacturing
  2. AI, Digital and Advanced Computing
  3. Bioinformatics and Genomics
  4. Engineering Biology
  5. Electronics, Photonics and Quantum
  6. Energy and Environment Technologies
  7. Robotics and Smart Machines

The Government will establish a new 'Innovation Missions Programme', the aim of which will be to tackle the UK's most significant issues, such as environmental and public health challenges. Whilst Innovation Missions will be judged by a clear and measurable outcome, it is anticipated that the development pioneered through the technology families will be essential in, and complement, tackling those missions and challenges.

These missions are to be identified by the new, and recently announced, National Science and Technology Council, which will aim to accelerate science and research in the UK. Also of note is that the now ever familiar Sir Patrick Vallance will lead a new Office for Science and Technology Strategy and also take on the role of national technology adviser, in addition to current roles as chief scientific adviser and head of the government office for science.

The strategy highlights that, in respect of deep tech investment, there is a challenge in that potential investors can be reluctant to take a risk on new and unproven technology, and acknowledges that the UK is weak in some areas of the journey taking new tech to market. In response, the strategy announces that the Government will launch eight new Prosperity Partnerships to establish business-led research projects and develop transformational new technologies, with a promise of £59 million of industry, university and government investment.

In addition, the Government will look to invest alongside business with a view to managing risks associated with deep tech development and, by way of examples, the strategy highlights:

  • The co-investment, by UKRI and IBM, of £210 million to stimulate high-performance computing enabled innovation in industry at the Hartree National Centre for Digital Innovation in the Northwest of England
  • £93 million commitment to scale emerging quantum computing technologies in the UK at National Quantum Computing Centre in Harwell

It is clear that innovation will play a crucial role in the UK’s drive to become a global tech leader. The Innovation Strategy defines clearly the challenges facing the UK, in respect of R&D and its innovation ecosystem. Tangible objectives have been set for improvement by defining innovation and also establishing those key metrics against which the Government will look to judge success.

We have seen, for example, that the success of vaccines and treatments for Coronavirus has delivered value from years of investment in UK science. It is therefore crucial that meaningful investment is directed towards innovation and research, as a priority, in order to build on those successes and also transform regional economies and level up across the country.

It is also important that support is provided to train, retain and attract the very best talent in the innovation landscape. This requires long-term and consistent funding solutions, so that businesses may develop and deliver their ideas and, whilst the Innovation Strategy is a clear and welcome starting point, we await with interest to see whether the spending review resources innovation accordingly.

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