Life Sciences Innovative Manufacturing Fund
(1 day, 8 hours ago)
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Madam Deputy Speaker (Ms Nusrat Ghani)
If everyone is in their places, in particular Mr Anderson, who seems to have sat on every Bench in the Chamber this afternoon—
Callum Anderson (Buckingham and Bletchley) (Lab)
Not the Opposition Benches.
Madam Deputy Speaker
Well, quite. In that case, I call the Minister to move the motion. Is this your first time at the Dispatch Box, Minister?
The Parliamentary Under-Secretary of State for Science, Innovation and Technology (Kanishka Narayan)
I beg to move,
That this House authorises the Secretary of State to undertake payments, by way of financial assistance under section 8 of the Industrial Development Act 1982, in excess of £30 million to any successful applicant to the Life Sciences Innovative Manufacturing Fund, launched on 30 October 2024, up to a cumulative total of £520 million.
Thank you for calling me on this none the less memorable occasion, Madam Deputy Speaker; it is the first occasion on which I seek the Chamber’s authority.
The life sciences sector is a jewel in the crown of our economy—a national asset that plays a unique role in both the health and the wealth of the United Kingdom. The sector drives jobs, investment and innovation right across the country, from cutting-edge research laboratories in Cheshire to—close to my heart—advanced manufacturing sites in south Wales. Life sciences manufacturing is the critical link between our world-class research and real-world patient benefit. It ensures that scientific breakthroughs translate into tangible improvements in care, while underpinning economic growth and strengthening the resilience of our NHS.
Yet despite the UK’s global leadership in many areas of life sciences manufacturing, we must acknowledge that, in recent years, growth in manufacturing sites and jobs has not kept pace with the expansion of the life sciences sector as a whole. That is why this summer the Government published the life sciences sector plan—a comprehensive strategy to ensure growth in all parts of the sector. The plan sets out the UK’s ambition to secure more life sciences foreign direct investment than any other European economy by 2030, behind only the US and China globally by 2035.
Central to that ambition is boosting manufacturing through delivery of the life sciences innovative manufacturing fund, one of six headline commitments in the sector plan. Launched last October, the fund demonstrates this Government’s commitment to the continued growth of our life sciences sector, with up to £520 million of funding available to support private sector capital investments until 2030.
Jim Allister (North Antrim) (TUV)
Northern Ireland has a vibrant life sciences manufacturing sector. I am looking to the Minister for an assurance relating to article 10 of the Windsor framework, which subjects Northern Ireland to EU state aid rules. Can the Minister assure us that there is no impediment arising therein that would impede successful applications to the fund from Northern Ireland manufacturers? That could also have a knock-on effect on GB, because if the goods produced are transported to Northern Ireland, they, too, come under the state aid rules. Has the Department examined that? What assurance can the Government give us on the protection against EU state aid rules for the fund?
Kanishka Narayan
The talent and ability of people in Northern Ireland are very much at the forefront of our minds, and we want to ensure that everything we are doing to support the life sciences sector is taking a whole-UK approach. I am very happy to write to the hon. and learned Member on his questions about Northern Irish eligibility.
Kanishka Narayan
I will make some progress for now.
The life sciences innovative manufacturing fund directly supports two of the Government’s key missions: to kick-start economic growth and to build an NHS fit for the future. The scheme is projected to attract nearly £4 billion in private investment, creating more than 7,000 jobs and safeguarding more than 5,000 existing ones.
However, the scheme’s impact is not just economic. The pandemic proved that we cannot take our critical supply chains for granted, and supporting the onshoring of life sciences manufacturing through the fund is therefore critical to strengthening our national resilience and preparedness for future health emergencies.
Kanishka Narayan
I will make some progress.
This week we announced the first two grant awards through the scheme, marking a major milestone in the fund’s roll-out. This will unlock substantial private investment, showcasing the UK’s appeal to valuable, globally mobile life sciences manufacturers. As delivery of the scheme progresses, we expect to announce more grant winners in the coming months. Each project supported through the grant will further strengthen health resilience and drive economic growth across all nations and regions in the UK.
James Wild (North West Norfolk) (Con)
Since the Minister has been talking about taxpayers’ money, I would be grateful if he could let us know what the minimum leverage is. For every pound of taxpayers’ money put in, what is the minimum that has to be put in by the private sector?
Kanishka Narayan
My understanding is that these are grant capital investments that the Government will be making, and I am sure we will be looking at the leverage at a whole-fund level. If there are particular requirements at an individual investment level, I am happy to write to the hon. Member on that particular point.
Kanishka Narayan
I feel that, out of parity, I must give way to the hon. Member too.
Robin Swann
Third time lucky. I welcome the Minister’s announcement of the fund for life sciences with regard to the companies we have in North Antrim and South Antrim. Could the Minister also ensure that any research and development tax credits that companies can apply for are fully supported, utilised and brought forward at speed so that companies are able to utilise not just the fund but the tax credits that come through R&D as well?
Kanishka Narayan
I thank the hon. Member for his important point. I am happy to take a full look at the R&D tax credit system and how it will support our ambitions to back our private sector partners in both R&D and subsequent commercialisation.
The Government are clear that the life sciences innovative manufacturing fund is a strategic investment in our future. It is a vital step in delivering the Government’s commitment to supporting the UK’s life sciences sector and ensuring that our country remains at the forefront of the sector.
Madam Deputy Speaker (Ms Nusrat Ghani)
I call the shadow Secretary of State.
Julia Lopez (Hornchurch and Upminster) (Con)
I thank the Minister for his statement—or perhaps I should call him October’s cover star for The House magazine.
The Conservatives back today’s motion on the life sciences innovative manufacturing fund. It is a no-brainer, because the fund was established by us in government when my right hon. Friend the Member for Godalming and Ash (Sir Jeremy Hunt) made £520 million available for life sciences manufacturing over five years—from 2025 to 2030. Funnily enough, it is the exact same amount that is being reheated today.
That fund built on a series of smaller, highly successful interventions that managed to attract £850 million of private investment for the £64 million of taxpayers’ money that we deployed. The Association of the British Pharmaceutical Industry called the fund a step change in ambition and something that would strengthen our manufacturing base, addressing the weaknesses we saw during the pandemic in our supply chains. It was good for jobs, for health security, for our life sciences and for Britain. So yes, we support this fund because we designed it.
Let us be clear about what is happening here. The Minister is simply uprating for inflation the threshold at which payments must be approved by Parliament. That is fine and all very sensible, but what it is not is anything new. It is not new money. It is not Labour innovation or a sign that this Government are suddenly getting really serious about growth, and it is not the route to dealing with the crisis facing life sciences right now. It is what we were doing but in different wrapping paper. They have plonked a bow on it and called it a new strategy.
Let me tell you what I reckon has happened here, Madam Deputy Speaker. An edict has gone bouncing around Whitehall from the Treasury and No. 10 as the November Budget disaster looms, saying: “We need some growth announcements. Departments, please feed the comms grid. We need to give the markets and the OBR some confidence that we are serious about growth.” It is worth reminding the House what happened yesterday. UK Government borrowing figures in September hit the highest level for the month in five years. This is truly terrifying stuff.
I think the Secretary of State has gone and asked her officials, “What have we got in the cupboard to announce?”, and they have said, “Minister, we have a statutory instrument to table at some point. Do you want us to shove a bit of lipstick on it?” We have the spectacle of Ministers coming to the Chamber to tell us that a humble statutory instrument to uprate for inflation something already in the pipeline is a grand plan. In no way at all does it shift the dial on life sciences, because it is already baked in.
This is not a Government who are serious about growth. Let us look at what happened to the life sciences manufacturing fund when Labour took office. In early 2024 we used it to negotiate a £450 million vaccine manufacturing investment by AstraZeneca in Speke, Liverpool. That meant real jobs, real regional investment and greater resilience for our country. After that, AstraZeneca announced another £200 million investment in Cambridge, which meant 1,000 jobs. To drive that investment and growth, we also delivered one of the most competitive business tax regimes through policies such as full expensing.
Then the general election happened and our new Chancellor, in her infinite wisdom, put a pause on that investment—supposedly to get better value for money and fill the fantasy £22 billion black hole in the public finances. We all know what happened next. AstraZeneca pulled the £450 million investment, despite issuing private warnings to the Government that it needed certainty for business planning. But do not just take my word for it. When announcing Speke’s culling, AstraZeneca said that
“the timing and reduction of the final offer compared to the previous Government’s proposal”
was critical to losing that £450 million investment.
What else has happened since Labour took office? AstraZeneca paused the £200 million Cambridge investment. We lost Merck’s £1 billion King’s Cross R&D hub, which was cancelled after eight years in development. That is £1 billion, and the Secretary of State had nothing to say about it—diddly squat. Eli Lilly has put its £279 million research incubator in London on hold. Sanofi has said that it will not consider “any substantial investment” in UK R&D under current conditions. In fact, industry has warned that the UK is becoming uninvestable for the life sciences.
Does the Minister know how many meetings the Secretary of State has had with life sciences companies in the past month? As I understand it, the answer is very few. What has she been doing to rally colleagues across Government and make clear to the Chancellor, the Health Secretary and Prime Minister the scale of the peril? I have been looking at her statements, and it is not at all clear to me that she has been doing anything.
The fund, which we support, is a capital manufacturing fund. It helps de-risk certain projects and reduces borrowing for companies, but it does not fix the fundamental problem of the commercial environment for medicines in the UK. We all know that Labour has made the commercial environment worse in many ways, such as through national insurance rises and other tax increases, and that has also made successful people not want to base themselves here.
There are also long-standing issues that need fixing here, including drug pricing and the voluntary scheme for branded medicines pricing, access and growth—VPAG—rebate, which risks becoming a tax on innovation. But the Labour Government have screwed the public finances so badly that they have nowhere to go on these issues, not least because the NHS has had to spend a large chunk of the money that the Government have taken from our constituents. They took a lot of money from our constituents and told us that it would make this big difference to the NHS, but the money went on wage deals in the NHS and national insurance rises. [Interruption.] Labour likes to talk about the tough choices it has made to the NHS, but I would ask Government Members to ask their constituents whether they are really seeing a tangible difference in the NHS. The Government have taken a hell of a lot of money from everybody and it is not working.
Normally I would be glad for the ability of the NHS to use its collective bargaining power to keep drug prices low, but there is now a real risk that life sciences companies will not be bringing new medicines to market in our country. That means my constituents and your constituents not getting cutting-edge treatments. It means pain, heartache and ill health, and it means that the life sciences industry that has served us so well is ebbing away and taking the high-quality, high-value jobs with them. This is a crisis. I must ask the Minister: can this fund succeed when the wider tax environment stands as is?
The issue of medicine pricing is fast coming to a head as President Trump plays hardball on drug costs. The US Administration have alighted on the UK’s low drug prices and are using them as a bargaining tool against the threat of tariffs. This Government have boasted of their special relationship with the US, and we have had endless excruciating shots of the Prime Minister prostrating himself before the President. Can the Minister tell us how that relationship is benefiting the life sciences, because I cannot see it for myself?
Can the Minister tell us whether the Secretary of State is aware that it looks as though His Majesty’s Revenue and Customs has decided that companies providing medicines for clinical trials or compassionate use under the early access to medicines scheme should now be billed for VAT? That is a tax on medicines that are being provided for free. Apparently, one company has already received a bill and more are on their way for others. This could affect trials and people’s access to medicine. Will the Minister please commit to looking into that urgently as Labour scrabbles around for more revenue? Will he also ask HMRC to publish guidance confirming that in fact the early access to medicines scheme falls outside the VAT deemed supply rules?
Will the Minister tell us how much of the £520 million has been spent to date? What is the current investment pipeline? How does it compare to the one he inherited? Will he update the House on the current state of negotiations between industry and Government on the VPAG scheme and medicine pricing, and with the US on tariffs? What conversations—if the Minister knows—has the Secretary of State had personally with the Health Secretary and the Chancellor on these issues? This is an extremely perilous situation for our life sciences firms and for patients’ access to new drugs.
Britain’s life sciences sector is worth over £100 billion to our economy and supports about 300,000 jobs. It is massive. It is one of our defining national strengths: a source of innovation, prosperity and national pride. Of course, it is also the key to better health for our constituents and people across the world. The life sciences innovative manufacturing fund remains a Conservative achievement, but unless the Government act swiftly to restore competitiveness and rebuild investor confidence, we risk losing our place at the forefront of global life sciences. I am afraid that no amount of rebadging, repackaging or recycled announcements will change that.
Several hon. Members rose—
Madam Deputy Speaker (Ms Nusrat Ghani)
Order. A tip for Members: if the word “you” or “your” is in your speech, just cross it out. You are speaking through the Chair. I cannot repeat myself day in, day out.
I call the Chair of the Science, Innovation and Technology Committee.
Dame Chi Onwurah (Newcastle upon Tyne Central and West) (Lab)
Thank you, Madam Deputy Speaker. It is a great pleasure to speak to you on this occasion to welcome the ambition behind the life sciences innovation manufacturing fund and, indeed, the Government’s positive support for life sciences, with their belief that Government can act to support industry in general; it is not simply a matter of getting out of the way. That is in sharp contrast to the last Conservative Government’s approach to industry, allowing a gentle decline and deindustrialisation in our nation. To be fair, the series of Conservative Governments chopped and changed their approach to industrial strategy so often it was difficult to know exactly where they stood. Unlike them, Labour is committed to the life sciences sector.
Labour published its plan for life sciences in opposition, which included 10-year funding commitments for key research bodies aimed at putting an end to the short-termism that undermines economic growth and scientific success. Now in government, I welcome Labour’s commitment to the life sciences sector plan—developed in close co-ordination with the Government’s 10-year health plan—which aims to support cutting-edge research and turn that into real-world results, with new treatments, faster diagnoses and more lives saved. It is about making sure that breakthroughs happen here in this country, creating jobs, improving lives in every part of the country and driving growth.
As the Minister said, the life sciences are a strength of our country—they are often described as a jewel in the crown of the British economy—and we all know that success in life sciences leads to positive, wide-reaching benefits across the country for the economy and our health.
Sorcha Eastwood (Lagan Valley) (Alliance)
You mentioned the sector’s relevance and benefit to the whole of the United Kingdom. Would you agree that Northern Ireland has a rich manufacturing and life sciences heritage and that we have a huge role to play?
Madam Deputy Speaker
Order. Ms Eastwood, it was only at the start of the week that I had to reprimand you twice for using the word “you”, and it has come up twice again.
Dame Chi Onwurah
Let me thank the hon. Member for that intervention, which pre-empts something I will say in a few minutes. She is absolutely right: Northern Ireland already plays an important role in the life sciences sector and life sciences manufacturing, and it will have an important role to play in the future.
It is an incredibly exciting time to be involved in life sciences. I often think that if I were a young engineer now—I studied electrical engineering—I would be fascinated by the life sciences and, in particular, synthetic biology, which offers so many potential opportunities for growth and wellbeing. It is an enabling technology across so many different sectors.
In Newcastle, including in my constituency of Newcastle upon Tyne Central and West, the life sciences contribute £1.7 billion and employ over 8,000 people across more than 200 companies. We are home to the National Innovation Centre for Ageing, Newcastle Helix and The Biosphere. Our city is one star in a constellation of excellent life sciences clusters across the north of England.
I really welcome the ambition of the innovation manufacturing fund. I ask the Minister in his response for more clarity in three particular areas. First, in regard to the size of the fund, in the face of increased competition, and as the shadow Secretary of State described—this will be in less sensationalist terms—we are seeing some reduction in investment in the UK. Is £520 million enough to ensure that the UK is an attractive prospect for internationally mobile businesses? By contrast, a manufacturing plant such as Moderna’s recently opened vaccine centre in Oxfordshire might cost in the region of £150 million to £200 million. Is the fund the right size?
Secondly, the Select Committee recently held a one-off session on life sciences investment, which was of such interest that we have decided to hold another one-off session next week on the same subject. We heard evidence from the pharma sector, including significant support for the life sciences sector plan and for the Government’s approach, but I think it is fair to say that we were told that, although NHS pricing is not the only factor in investment decisions, it is a significant one. We heard evidence that the UK spends less proportionately on medicines than other comparable countries and that that reduces the pull-through for innovative medicines. It would clearly be a difficult decision to spend more on medicines, as that would mean spending less elsewhere in our NHS.
Does the Minister see the manufacturing fund as support in some way for investment decisions in the absence of progress on the NHS pricing discussions? Could he tell us whether the Secretary of State is involved in discussions between the Health Secretary and the pharma sector with regard to NHS pricing? I understand that discussions are ongoing, and I see the Under-Secretary of State for Health and Social Care, my hon. Friend the Member for Glasgow South West (Dr Ahmed), conferring with him. Perhaps he can confirm that those discussions are ongoing.
Lincoln Jopp (Spelthorne) (Con)
When the Committee held its one-off session on investment in life sciences, did it unearth the reasons why Sanofi, Eli Lilly and Merck have recently chosen to disinvest in life sciences in the UK?
Dame Chi Onwurah
I thank the hon. Member for that intervention. The Committee’s work is fascinating, so I certainly recommend he read the transcript. To summarise, we were looking specifically at the reasons for investment being pulled and, as I said, we asked the question in a number of different ways. The message that came back was significant support for the life sciences sector plan and the Government approach, but lack of certainty and clarity over NHS pricing and dismay about some aspects of NHS pricing and National Institute for Health and Care Excellence decisions. The hon. Gentleman is therefore right to point out that there was concern over the current and likely future pricing of innovative medicines, but that was not the only factor in those investment decisions. I ask the Minister to give us an update on those negotiations to the extent that he is able to do so, and to say whether this manufacturing fund is seen as potential compensation for investment in medicines and pricing as part of the NHS future plan.
Matt Rodda (Reading Central) (Lab)
My hon. Friend is making some interesting points about investment decisions. Has her Committee also investigated why some decisions have been made to bring investment into the UK, such as the recent decision about investment in Oxfordshire? As part of that, is there a parallel need to explore where more could be done to attract further investment through perhaps greater supply of trained workers, better transport, better access to land for development, and so on?
Dame Chi Onwurah
My hon. Friend makes an excellent point. My Committee has looked at some of the reasons for investments, such as those he sets out, and it is worth emphasising the strengths of the UK, some of which I have mentioned. We have a really strong life sciences sector, and specifically skills at every stage in the UK life sciences ecosystem, together with R&D tax credits, which is another point of incentivisation, and the fact that our NHS offers a fantastic opportunity to test and trial new medicines with a population that is heterogeneous and with population data records that are second to none. So there are many reasons why pharma and life sciences companies are continuing to invest in our country, and we have a fantastic ecosystem of life sciences start-ups and scale-ups.
That brings me to the final question I want to put to the Minister, which is on the regional impact of the fund. The Minister mentioned on a number of occasions that the fund will drive investment and growth across our country. As part of the Committee’s inquiry into innovation and regional growth, we heard of significant disparities in investment, particularly in access to capital and research funding from UK Research and Innovation and in funding and investment between the regions of our country and the greater south-east, otherwise known as the golden triangle. Manufacturing is well distributed across the United Kingdom; we heard earlier about the opportunities in Northern Ireland. Can the Minister tell me whether there will be a regional dimension to how the funds are disbursed? I hope that the extent to which the funds are regionally distributed will be monitored, but does he expect that this funding will be distributed across the country to drive growth in every corner of the country as he said, and that it will not perpetuate existing regional inequalities?
Madam Deputy Speaker (Ms Nusrat Ghani)
I call the Liberal Democrat spokesperson.
Pippa Heylings (South Cambridgeshire) (LD)
It is my huge privilege to be the MP for South Cambridgeshire, which is home to Europe’s largest biomedical campus and the UK’s world-leading tech and life sciences sectors, and one of the largest contributors to the UK economy.
The Liberal Democrats have long recognised that strategic investment in life sciences manufacturing is essential to our economic future and our national health security. Central to the delivery of the life sciences sector plan as part of the wider new industrial strategy, the life sciences innovative manufacturing fund is welcome and exactly the kind of targeted intervention the research and development sector has needed for a long time. While boosting economic opportunity, the fund also aims to increase the UK’s health resilience and ability to withstand and recover from health emergencies such as pandemics, long-term healthcare challenges and system shocks such as supply shock disruption.
Steff Aquarone (North Norfolk) (LD)
Scientists at the Norwich research park and Quadram Institute are doing incredible work in the field of agri-science, which could transform the future of food for the better; in fact, the Quadram Institute will be visiting Parliament and briefing MPs during evidence week next month about this work. This research is perfectly located to create jobs in my constituency, both directly and in the supply chain. Does my hon. Friend agree that investment in exciting life sciences projects such as those in North Norfolk is particularly crucial to unlocking growth in the rural economy?
Pippa Heylings
Absolutely. Investment in the life science sector in the rural economy is critical, and that is why we are concerned that this motion comes at a time when our life science sector is in crisis—and, frankly, I am not hearing yet from the Minister that the Government are grasping the scale of the crisis. I have heard consistent concerns from the life science sector about this, with Novartis saying that the UK is becoming “largely uninvestable”. We have seen signs of this, and heard of it today, with the loss of planned investment by Merck MSD in life science and vaccination manufacturing facilities to the tune of £1 billion and also £450 million-worth of investment by AstraZeneca. That comes on top of AstraZeneca pausing the planned £200 million expansion of its research centre in my constituency. This is obviously ringing alarm bells across the Chamber.
Additionally, in a report by the Association of the British Pharmaceutical Industry, “Delivering a voluntary scheme for health and growth”, life science leaders are warning that the Government growth plan will not succeed unless Ministers commit to fixing a scheme known as VPAG—the voluntary scheme for branded medicines pricing, access and growth—which unexpectedly now requires companies to pay record clawback rates of up to a quarter or even a third of their revenue from sales of branded medicines to the NHS.
The Liberal Democrats would commit to raising R&D spending to 3.5% of GDP by 2034, a decade-long commitment that gives businesses the certainty they are asking for. We would introduce proof of concept funding to help researchers develop their early-stage ideas and empower local authorities to develop regional spin-out ecosystems so innovation can drive growth and high paying jobs right across the country, as well as where I am in my constituency in the golden triangle. I therefore ask the Minister to set out, in addition to this much-awaited manufacturing fund, the status of the last-minute negotiations with companies and their investments, such as AstraZeneca and Merck MSD, and also what the Government are doing particularly on VPAG to restore confidence to pharmaceutical companies that the UK is a competitive place, attractive to investment, that values research, development and manufacturing.
Sorcha Eastwood (Lagan Valley) (Alliance)
I will try to get my words correct this time, Madam Deputy Speaker—the second time.
I simply want to say, Minister, that I really do believe that we in Northern Ireland have a huge role to play—not just in Northern Ireland, but across the UK—for many, many reasons. Other Members have mentioned a number of things including R&D tax credits and the skills ecosystem, which is really relevant to all this. I am perfectly well aware that we in Northern Ireland are obviously part of a devolved settlement, but there is an opportunity to re-engage how we drive forward opportunities for skilling people for these sectors through the likes of apprenticeships and how we interface with businesses.
This might sound a bit left-field, but I genuinely believe that this sector is hugely significant in terms of national resilience, national security and national propriety of our own intellectual property within the UK. This is a huge sector and it has the potential to make sure that we are self-sustaining and that we also work with companies over a long and sustained period of time to ensure that, in an era of antimicrobial resistance for example, we have the tools at our disposal should—God forbid—anything ever come down the tracks again in terms of pandemics or challenges to our supply chain.
I know that that was probably a lot to take in. I just reiterate our potential in Northern Ireland. We have a huge heritage that goes back decades and we stand ready. Others have mentioned the headwinds coming down the line, not just in the UK but as we try and navigate our way through this global turmoil of tariffs and trade and what that means. We now have a golden opportunity to get this right.
Madam Deputy Speaker (Ms Nusrat Ghani)
Wonderfully done. I call Minister Narayan.
Kanishka Narayan
I want to be in your good books, Madam Deputy Speaker, so I will proceed at pace in answering some of the questions raised.
I first thank the Members on the shadow Front Benches and in particular the hon. Member for Hornchurch and Upminster (Julia Lopez). I was sad that her generous welcome to me was not extended to this particular announcement. In particular, I was sad that she did not welcome the fact that out of their Tory fiscal wreckage we have managed to get £520 million for the British life sciences sector, that out of the economic damage they did to this country we have still managed to secure over £1 billion in investment from Moderna in the British life sciences sector, and that out of what we inherited from the Tory context we have managed to secure over £1 billion from BioNTech. Right across the board, there is a picture of stability, good jobs in the life sciences and broader technology sectors, optimism and, above all, an energy shared across Government, the private sector and academia.
Kanishka Narayan
I must proceed because, as I said, I need to be in Madam Deputy Speaker’s good books.
A particular concern has been raised about VPAG, another part of a longer-standing legacy from a Tory Chancellor’s austerity rampage for the life sciences sector in this country. The Government’s position is very clear: we will always put patients and taxpayers first. This Government are open to working collaboratively with the pharmaceutical industry, which is exactly why we have put forward a generous and unprecedented offer worth approximately £1 billion over three years as part of a review of VPAG, which ultimately industry did not take a vote on.
We remain confident in the life sciences as a driver of both economic growth and better health outcomes and our door remains open to future engagement. I know that regular conversations go on and while I will not update Members on the shadow Front Benches on every single meeting the Secretary of State takes, I can assure them that she is involved in both the particular conversations around VPAG and more general engagement with the life sciences sector.
I particularly thank my hon. Friend the Member for Newcastle upon Tyne Central and West (Dame Chi Onwurah), whose depth of experience in engineering prior to this House and extensive experience in this House, in particular through leadership of the Science and Technology Committee, is one that I take considerable inspiration from.
Kanishka Narayan
I will make some progress for now. My hon. Friend raised a particular point around synthetic biology, which is very close to my heart because I think that Britain has a particular opportunity in the convergence of engineering, AI and life sciences, and we are keen on seizing that to its fullest extent.
On the three particular questions from my hon. Friend the Member for Newcastle upon Tyne Central and West, foremost of which was about the size of the funding available, I will say a couple of things: first, that this is the largest fund of this nature announced in the history of the UK Government, to my understanding, with capital grants worth £520 million altogether; and secondly, that it is but one part of the overall funding package across Government if one considers the investments across Innovate UK, UKRI, the British Business Bank and beyond. I hope that some of the assurances around VPAG have answered the particular question posed there, and on regional impact, I point out that the first two grants from the scheme were made out to firms in Birmingham and Keele. I hope that is a starting indicator of my long-term hope; we will certainly monitor it.
Kanishka Narayan
I am afraid I will not; I believe I have been relatively generous in welcoming contributions from across the House. On the point of regional impact, in addition to the midlands, may I join the shadow Front Benchers in welcoming—they do so with laughter and amusement—the collective efforts of our entire Northern Irish contingent? I will take away the strong point about Northern Ireland’s strengths in the life sciences sector; it will be embedded on my mind.
I thank the hon. Member for South Cambridgeshire (Pippa Heylings) for South Cambridgeshire for talking about investments. The only thing I will say on some of the announcements is that they have to be taken in the context of the wider global context for those firms, MSD in particular.
Kanishka Narayan
If the Member listens, he may feel that his point is addressed in my claims. In at least one of those cases, a pause, rather than a cancellation, was announced and in the other, there have been a series of announcements globally regarding thousands of jobs, not only in the UK but beyond. As I said, I hope that the two announcements I mentioned, by Moderna and BioNTech, will give us some assurance that the life sciences sector in the British context is firing on all cylinders with Government support.
Finally, I note with thanks the important point on national security and IP made by the hon. Member for Lagan Valley (Sorcha Eastwood). It is top of mind for me in ensuring that we are not just powering economic growth and not just jobs and good health for people across this country, but doing the first job of Government to protect our national security.
Question put and agreed to.
Resolved,
That this House authorises the Secretary of State to undertake payments, by way of financial assistance under section 8 of the Industrial Development Act 1982, in excess of £30 million to any successful applicant to the Life Sciences Innovative Manufacturing Fund, launched on 30 October 2024, up to a cumulative total of £520 million.