Science and Technology Committee

Tuesday 14th July 2026

(began 2 weeks ago)

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10:20
10:21
None Portrait Speaker 2
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They are very big questions, Lord Mayor. Thank you. Um, in terms of the outcomes, if I come back to the top of our strategy, which is our mission statement, so to advance knowledge, to improve lives and to drive growth and fundamentally everything that the organisation does is pivoted around the three clauses of that mission statement. So when I talk about, um, outcomes and generating value, securing value for the country, that that value is not just economic benefit, right?There is huge value in advancing knowledge and advancing our understanding of the world.

Uh, generally that sort of foundational breakthrough research acts as the underpinning for everything that follows. So that is an outcome in and of itself. The advancing knowledge part, then the application and improvement of the social fabric of the country, of people's lives, of regional inequity. All of those things are also outcomes. Um, and then there's the obvious outcome of benefit to the economy and how we help drive the economy, which then allows us to reinvest more into the research and innovation which provided that growth in the first place.

They have to be interconnected. Thing is a symbiotic relationship. And Ukri should be making investments on the multi-decadal time frame, but also allows us to reinvest more into the research and innovation which provided that growth in the first place. So the whole thing is a symbiotic relationship, and we're always looking for a mutualism between those three legs and how we help to reinforce, because they are not disconnected. They have to be a system. They have to be interconnected.

Timescales, as you alluded to in your question, are completely different for those things. And Ukri should be making investments on the multi-decadal time frame, but also trying to achieve outcomes and outputs on a quarter time scale. This is sort of a plan for decades, but executing quarters and as an organisation, we have to be able to tension those things in our head. It's no good for us to say, well, everything that we invest in will be decades away. The organisation, in its different guises, has existed for over 100 years.

Of course, the MRC is more than 100 years old. You can't say, well, everything's decades away. We've been investing for decades. Um, and I think self-evident is that the proof of our labors and those long term investments have for sure yielded benefits to the country, both socially and economically. And we should be proud of that. That is what we're for as an organisation. So we should be able to both think long term and also generate outputs in the near term.

Um you talked about behavioural change, so let me try to address that somewhat. The organisation um I think has felt itself to be a distributor of money for many years. So we see ourselves as a conduit of public money out into our. Out into our partners who then do the research and innovation and exploitation. I want us to go beyond thinking about just distributing money into. Well, how do we generate value for the country?We are, after all, a public body.

We are spending public money. We are here in service of the public. And I think we should be constantly thinking about how does this generate value to the public and value in the wider sense of what I've just talked about?So yes, value of advancing knowledge and improving lives and economic benefit, all of those values. Um, and so becoming sort of elevating our relationship with our partners away from the transactional, we run a competition. It's massively oversubscribed. We use a peer review process and we choose some people to be recipients of that money.

And then we give them some money and they go and do some research away from that sort of transactional relationship to a more strategic relationship where we are working with partners to make sure that we deliver outcomes for the public whose money it is, after all. And it's more of a genuine partnership rather than transactional relationship. That is going to be a change of culture and a behaviour inside the organisation. We, we see pockets where that works brilliantly and is done really well. And I would like to do that across the whole of our remit.

And then the third thing on um on behalf. Change inside the organisation is to, is to extend that partnership away from the practitioners. Well not away from, in addition to the practitioners of research and innovation, who we see as our main partners at the moment, to also have strategic relationships with Co-investors be that private capital or philanthropy or big primes, so that we are crowding in more money into the system. I don't think we should be having this constant debate about, well, how do you distribute your 9 billion a year?How do we cut up that pie?I want us as an organisation to be catalysing a bigger pie.

Go and find more eggs and more flour and bake a bigger pie. And then let's discuss how we how we distribute that. And not just how do we cut up the 9 billion. That is not a useful. Well, I mean, of course that is a necessary thing to do. But but we shouldn't be exclusively focused on that. We should be thinking how do we how do we actually enrich the whole system and, and use our heft, frankly, use the scale that Ukri has.

In my view, it was one of the reasons that UK and the two primary reasons that I think UK is important. One is that it. We have this incredible breadth and remit which allows us to connect the system and to do genuinely interdisciplinary, large scale projects that couldn't be done in in isolated councils. That's the first benefit. But the second benefit is that we then have heft, and that heft should allow us to, um, to connect more private capital into the system to, to grow the ecosystem, which helps everybody.

It's a rising tide. And I feel that we should be doing more of that catalysing that helps the whole economy and allows us to invest more into research and innovation.
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None Portrait Speaker 2
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Yeah, measuring my view on, um, on measuring is that these things are multi-layered and hierarchical. We are now at the point where we have a clear mission statement. We have clear objectives from DC, which hitherto hadn't been in place, but we now have five clear objectives for the organisation. Underneath those objectives, we have a set of goals that the organisation is trying to achieve. As elucidated in the strategy document that we published yesterday. And then beneath that we have, um, KPIs again published yesterday.

We went through our objectives and the high level aggregate measures that the organisation is held to account against over five years and one year. And then below that, I have a number of management key results inside the organisation numbered about 50, which for an organisation of our scale, feels about right. To me. These are the 50 biggest, most important things that the organisation will will aim to achieve in the year. And they all have a responsible owner and I can hold that person to account against the delivery of of those metrics, all of which is open to me and will continue, will publish quarterly how we're getting on against all of those measures.

The aggregate ones, usually on a on a long time base, those 50 measures which are in a year, we on a quarterly basis can say, this is how we're getting along against those. So there are both different time bases and different aggregations. But that multi layer of, of measurement and output, I think is very necessary for an organisation like ours.
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None Portrait Speaker 2
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Could be, could be. Um so again, not hard and fast and I imagine it will be dependent on competition and the nature of the call. So it's not prescribed. It will be, it will vary. Um, expanded um sort of programme led commissioning. So we have a tighter scope on the objectives that we're trying to achieve. Perhaps focusing on fewer but larger, um in some of our, in some areas of our portfolio, uh, again, to minimise the bureaucracy in the system.

Um, so that's the first thing on the downstream measures, increasing assessment capacity. Again, there are many different things that you could do there. We could expand the triage that is done by our staff. At the moment. Our triage knocks out almost nothing. And it's only on a compliance check. We do almost no quality triage. Whereas when you're applying to a journal, the journal will knock out up to 70%, right?So they'll just say, well, we're not even going to send that to peer review.

They do a quality triage. We don't really do any of that. So of course, that means having swept people to, to, to make those decisions. But we could do a greater level of triage than we currently do. We could increase our use of distributed peer review, where we know then we have a pool of, of reviewers. We don't have to go and find reviewers, which takes a lot of time in the system to find reviewers. Um, and it's also very scalable.

So you can do big calls then with lots of applicants because you know, you've got the reviewers a priori. Um, we could use greater augmentation of AI in the assessment process. I'm not saying that we'll go away and just use AI, but, but we could use augmentation of AI. Um, so lots of different interventions that we could make there. Um, and then the third part is, um, strengthening our decision confidence and what do I mean by that?Well, again, the MRC, for instance, are doing experiments this year on reverting back to more in-person interviews as part of the process.

And if you think about most, most investors who are investing at scale, if you're a venture capitalist, you do go talk to the founders, right?You look in the whites of their eyes. If you're hiring an employee, you typically talk to them. You don't just rely on the CV. So bringing some in-person part to the assessment process then allows us a greater verification of the maybe the, the other measures that we've taken upstream of that so that we continue to have robust processes.

So it's going to be a combination of all of those three things. It will be different on different calls. And for sure, that has to be a collective with with our sector, with our users. We're not going to determine that in isolation.
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None Portrait Speaker 2
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Yeah. So, um, how far have we got with it?So as I said, we are doing a number of experiments this year and. We need data. We need evidence. Because otherwise you're working on hypothesis. And so, um, we are collecting data. We have now started doing many of these experiments. By the end of the financial year, we should have completed a whole load of experiments and will actually have data to talk to the community about.

Um, in an evidential way, which is, I think, how we should proceed not not just based on hypothesis. Um, so, um, until we have collected that data, we're not planning to make any radical change to the system because we're doing so with without good data. So we have to get through that bit first. Um, is the short answer to that. But I think um, what Tom said is completely correct, particularly for, um, you know, for the research councils who are largely interfacing with universities, there are a number of universities and they have a number of researchers.

So you have almost a fixed pool of likely applicants for innovate UK. In particular, the number of companies who could apply is just as big as you want it to be. Right. So, um, the, the, the lowering of the sort of Coulomb barrier, you know, decreasing the, the barrier to entry and providing more tools to more companies to apply means there volumes, we expect their volumes to, to really go up significantly. And so we do have to do things differently, I'm sure of that.

But but until we have data, it's hard to know precisely which direction to head in.
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None Portrait Speaker 2
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Yeah. I mean, I suppose I start with, um, the, the wondrous parts of the job and the less fun parts of the job. Um, you carry and I've now been in for ten months and I suppose my favourite part of the job is seeing the incredible richness of the portfolio into which we invest. You know, we, we really do matter to this country. We matter to the planet, right?We matter to society. And the research and innovation that we do is phenomenal.

And that is so exciting to be a part of that. However, um, for every five great ideas that come to us, we invest in one. And that means that there are four great ideas in which we don't invest. Um, and uh, that is hard. It's hard in the system. It's hard for us. You know, my people take that really seriously. There's a, you know, there's an emotional damage to them every time they have to say no to people.

Um, and, uh. That is, it's hard for the recipients of that because they are, you can't be a researcher. You can't be an innovator if you're not like properly committed to your work, because God knows you get so many knockbacks, you get so many failures, you get so many things that don't work. You just have to like rip through your core. You have to believe in it. So when you then don't get an investment, you take that personally, right?It's a, there's, there's, there's personal cost to that.

And we feel that, right, that, that, that happens to us as an organisation all the time. Um, and so we do care deeply about the impact that we make. So that is the downside of the job. And, and you're entirely right that whenever you make change, particularly change in a, in a sector with a level of precarity, which is what is true of our research and innovation sector at the moment, that change can feel daunting and dangerous to people. Um, I'm a researcher and I believe in evidence, so I don't believe in religious belief.

Um, when we're making these decisions and you can't have a conviction of we must do it that way because that's how we've always done it. It's not acceptable to me. That is not a defence. Um, we have to work in the basis of evidence as to what is the best thing for the country to get the right outcomes. And if that means change, it means change. Okay. And then we have to go through change. Um, so that's my rationale is present evidence as to why we're making changes that we make.

Okay.
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None Portrait Speaker 2
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Um, so the answer to that is I think we need to do more. We collect the data. So the data exists in our data bank. All of the unsuccessful applicants. I think we can there's a rich database there that we can do more to exploit. We can look at um, trends that are emerging in the applications that do not succeed, but that tells us a bit about the future. It tells us a bit about the future.

Now, there are many reasons that a panel may recommend not to invest in things. And, and in some cases, it could be that it's too much risk. So there could be a perception amongst panel members that this is too unlikely to succeed. But that's useful data that is telling you something about emerging trends in a field. And we should throw it away at our peril. I mean, we should use that data to identify things that are coming down the track.

A novel technology which has promise. Um, we can also interrogate more about the peer review. So quite often we will get, particularly at the high novelty end, you will get a set of peer reviews, two of which say this actually is revolutionary and could really advance the field, and maybe two who are more cautious, who will say there's high risk in this and give lower marks. Now, they may both be right, but there is something to be said about thinking about the the mindset of the reviewers and the comments that they make.

And we could do more to scrape information from the written commentary and than we do to assess, you know, future prognosis and opportunity. So, um, that you're right to, um, you know, highlight that there is a great database there and that is all captured. It's all in our data bank. So we do have that information. I think we could do more to interrogate what it's telling us actually than, than we do at the moment.
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None Portrait Speaker 1
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Baroness Willis.
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None Portrait Speaker 1
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Well, Ranger, uh.
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None Portrait Speaker 2
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Uh, let me just make a note of all of that. There was about ten questions there. So, uh, do my best to go through that. So culture shift to start with the people that we have as an organization, I think it is worth, um, reminding ourselves as to the constitution of Ukri in that, um, people often think that we are a funder and that we distribute money. Um, firstly, we are research performing. There are 6500 researchers inside Ukri to contextualise.

That's like Oxford or Cambridge. So it's the same scale of researchers as a high quality university. Um, and. I think people forget that UK does perform research as well. Um, then in addition to that, there's sort of 2500 people who do run our investment decisions both into companies and into, into research grants. Um, and those people come from different places. So some have come out of universities, some were active researchers and have moved into portfolio and project management.

Um, some come from a commercial background. And I think that blend is a good thing. Um, I would say that culturally the organisation is skewed towards the thinking about the, the novelty and the excellence of the research, which is good. Absolutely. A function that we must do as an organisation. I don't think that we do quite as much at thinking about the translation of that research into product and into companies, and helping companies to grow, and we probably don't have enough skills on the commercial and entrepreneurial end.

And thinking about the connection to the supply chain and the absorptive capacity in the country to, to export this. So there is work for us to do. And that will require, you know, some onboarding and retraining inside the organisation. So both an upskilling of some of the people we've got and probably bringing in skills where we're a bit deficit inside the organisation. Um. As to the which companies to back we um we are making a change within innovate UK, moving away from what I would describe as investing in projects and instead investing in companies and that that is a shift in mindset.

So it is thinking about the whole value proposition, not just the excellence of the research. It's also thinking about, well, okay, do we have excellent research which is internationally differentiated, which also has market opportunity, where there's also additionality of the public investment to other investment, which will probably also make a place difference where there's also supply chain and absorptive capacity. So we are thinking about all of those questions before we make an investment into the company. Is it the right team?Do we have the right founders?Do we have good chance of success?Are we backing the high growth potential and not just backing indiscriminately?So, um, there is more thought going into and we're not there yet.

So we've only just. Announced this change in thesis in, in March. And so it is still early days in the genesis of this change in behaviour. And you are quite right. Right. To identify that that will mean a change in skills in make up of the organisation. We previously did a lot of connection of small companies to opportunities for small grants and therefore spread very thinly. Um the shift to this model means we'll still do some connection, but we'll have to do more on the diligence and more on the assessment of the company's growth potential.

And that will mean a bit of a shift in the capability inside Ukri.
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None Portrait Speaker 2
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Probably three parts in that question as well. So firstly, I don't think that we are going to become an investor. I don't want us to to get into the territory of venture capitalists. Um, it's not, it's not our business. We shouldn't be making equity investments. We should be enabling. So, so we talk about this velocity programme deliberately. So previously innovate would give a grant, might last a year, might last 18 months. And then as a cliff edge and the money stops and the company has to bid for another grant and they might get another grant and it becomes quite lumpy, right?So they get a sort of step profile of funding, which is not great for your cash flow.

When you're a small or or newly formed company. So that's hard to work with. So we're trying to move to a more concierge service where you tell us the milestones. If we make an investment, you meet the milestones, then the next tranche comes, and then the next tranche comes and deliberately use the word velocity for two reasons. One, um, there's a pace to that. There's a change in the cadence. Um, and secondly, as you ramp up in velocity, you can reach critical velocity at which point you don't need us.

And the private sector will take over because we've diminished the risk. And then private capital will invest in that. So, so we shouldn't be making equity investments, and we shouldn't be playing in a place where the risk is low enough for private capital to play. So I definitely want us to stay out of the place where private capital would, would, would naturally invest, because then we're not additional and we shouldn't be doing that. Um, so how do we bring in the skills?Well, work with the people who do make investments in that space.

Work with the British business Bank in the public sector, work with the office for investment, work with UK GI and the National Wealth Fund. So there are many actors in the public system, and we have to work together and, um, you know, another joy for me in the last ten months has been seeing a much more concerted approach to that in government. Now we meet as a group of public finance institutions, sort of every month or six weeks. It's chaired by Jim O'Neill, who's second, person.

And the Treasury has taken really seriously all of the chief executive of those bodies always attend. Um, there is much more connection and genuine collaboration and working together on projects than there has been historically. And I think that is a really good thing to bring all of those which have distinct roles, but bring them together. In fact, essentially your report said why not merge them?Well, the first step is just get them to work together really well and know what they're for, know what their part is in the system.

And if they're working collaboratively, it's sort of achieves the same thing as you were advocating. I would contend. Um, and then your last point about diligence, um, I do feel there is more that you care, I can do to help provide high quality diligence whereby a, you know, a grant from, from innovate UK or, um. There's some sort of kitemark or watermark that we can provide into the, into the private capital system where that has a mark of respect and trust from a technical side, it doesn't say about the company or the founders, but just the technology.

Um, let me expand on that a little bit. Think about our network. We have 10,000, give or take 10,000 inside Ukri within our centres, institutes, catapults, there's another 40,000 technical experts. And then every year we invest in, roughly speaking, 50, 000 people in universities, there's 100,000 people. If you want an expert on anything, we have an expert on anything from quantum technologies to, you know, Roman history. We have an expert on anything. So I am keen that we use that that connection that um, portfolio of brilliant people.

And then investors shouldn't need to have to go find these people because we know who they are, you know, we invest in them, we know where the expertise lies. We can play a role in helping be a diligence engine for private capital. And then, um, reducing somewhat of the friction and the barriers to making investments into UK companies.
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None Portrait Speaker 7
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Thank you.
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None Portrait Speaker 1
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Well Duncan.
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None Portrait Speaker 2
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It's an evolution, I must say. I wouldn't want to, um, I wouldn't want to be hyperbolic about it. Um, and with every change, if you go at a rate that people cannot accommodate, the change will fail. So you have to go at a rate that people can accommodate, particularly the people who run the organisation staff, the people who deliver. If you go to rate at which they cannot accommodate change, the change won't stick and won't work. So I do feel it has to be an evolution.

Um, I come back to what I think. I think it was Lord mayor who asked me, um, and I talked about my view on the purpose of Ukri. And I think it's oversimplification to think of it just about the coordination of the different councils and research strands and trying to drive more multi and interdisciplinarity. That is a good thing. And absolutely that was a purpose of the creation of Ukri. But I, but I do think there is more beyond that, where by giving an organisation that heft, you can do more to raise private capital into the system and help create the vehicles that then invest in the companies that come out of that portfolio.

You can do more as a diligence engine for the for the country. Do more to I think I said, get more flour and more eggs that make a bigger pie and make a bigger impact for the public purse. So that is hard to do when you're siloed up. So I do think that is a, a thing that that you care. I had to go through some foundations, had to go through some integration, and we now have the foundations in place after the last chief exec put the foundations in place to be able to take on a bigger role.
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None Portrait Speaker 2
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Um, so so firstly we identified a cost pressure and that is a serious cost pressure. And it would be irresponsible management if we didn't address the cost pressure. We cannot continue down a road where we are exceeding budget year on year and making the situation worse. So I think it is right and responsible management to deal with that in good time. Um, secondly, we, we have done this through a broad and wide consultation. We had ten big consultation events.

We had written input from the 48 project investigators, principal investigators that are recipients of Stfc grants. We had 30 different advisory panels, council meetings, science boards across, uh, the last few months in order to arrive at a decision, um, that decision does involve difficult choices for sure. Um, because we did not want to incur, um, we didn't want to make, uh. In order to, to reach budget compliance, uh, we, we were faced with the situation where we may have had to turn off facilities immediately in order to come to a budget compliant position.

We did not think that was the right answer for the country. It would have immediately degrade our international competitiveness. It would have taken away facilities which underpin so much of the science and technology which happens in the country. Um, and would have been a very deleterious thing to do. And so to avoid that, Ukri has liberated an extra 135 million in addition to Stfc's budget over the next three years, so that we can actually spend more money in the near term in order to then bring the budget into a sustainable position over a four year period, rather than forcing it in year one.

We're doing it over four years. That gives us a smooth transition or a pathway to a smooth transition, whereby we can protect the high quality discovery science, which gives us a renown and brilliant people who go on to support the economy more broadly, as well as discovering new things and advancing knowledge. Um, and we can keep open our three largest multidisciplinary facilities, which underpin a lot of the interdisciplinarity that we were talking about in earlier questions. Um, everything from life sciences to material science.

So a broad gamut. Um, we have challenges in order to walk that pathway. So we will have to reduce our costs. And we do think that operational efficiencies are achievable between the way that those, particularly the, the three big multidisciplinary facilities, the ISIS, ISIS, neutron and muon source, the diamond light source, and the central laser facility. We do think that we can operate more efficiently there and make realise some operational savings. And as well as delivering operational savings, we are going to be seeking income generation.

And again, I cannot justifiably say to the Stfc team, go and generate more revenue tomorrow. It just won't happen. They need a runway and a pathway up to that. So we're giving two years of time to go and change the way that we interact with our industrial users, to go and change the way that we interact with our international users to do more cost recovery and more revenue generation to take the pressure off the public purse to contextualise that. By the way, the increased revenue that we're talking about is 29,000,000 in 4 years time against a core budget of 840 million.

So it's not that I'm saying go and win all your money commercially. It's 29 out of 840. That feels, um, realizable to me. So it is a challenge, but I don't think it's an incommensurate challenge. So a combination of those two things, realising efficiency, savings and driving increased revenue will then put us on a pathway to a sustainable footing with this extra 135 million from the other research councils, all of whom agreed this is the right thing to do for the country, despite the fact that it means that they have to defer projects, they will have to defer projects into future years to liberate funding in the near term.

So that's the pathway that we're walking. It is not a comfortable pathway. None of these are easy decisions, but we do think that is the right thing to do.
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None Portrait Speaker 9
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Thank you.
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None Portrait Speaker 10
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You do agree.
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None Portrait Speaker 2
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Absolutely.
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None Portrait Speaker 2
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Yes.
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None Portrait Speaker 10
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What happened?
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None Portrait Speaker 2
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Yeah.
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None Portrait Speaker 2
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No.
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None Portrait Speaker 11
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Thank you. It's in the same spirit of a different perspective. Um as Lord Grayson's questions um budget allocations should depend in part on. Formations or as you can of rates of return. Yes. But not narrowly. Not solely. But you'd hope that they would have a strong influence within other issues. And so I want to ask about estimations of rates of return. Briefly, but I hope but in terms of methods, estimates themselves and allocations.

So first I'll give you all of them. And then if you can take them as a, as a group, um, it's, it's not easy to estimate rates of return to R&D. It's in the nature of the beast. You know, there's the scope and there's the uncertainty and there's the length of time and all those things are not problems. They're actually in the essence of the whole story. So it's hard and recognise that. And for transparency, a 20 years ago as second term at the Treasury and head of the Government Economic Service, I was in charge then of the Green Book.

But this goes beyond the Green Book, as we all know. So the first question, are you comfortable with the methods that are being used in Dcit and Treasury?The second is the estimates themselves. Dcit is rather cheerful about the statement that the benefit cost ratio is about 8 to 1, as they've estimated it. Other estimates, rather than benefit cost ratios in terms of rates of return, have been 40% or so. And these are numbers that I'm sure you use familiar with.

But that's a. Then that leads immediately to another question. I mean, if those rates of return really are benefit cost ratios of 8 to 1 or embodying benefit cost ratio, we should be, if you really believe it, and the Treasury really believes it, we should be spending far more on R&D than we do. Is there something wrong with the 8 to 1 or, you know, you know, I've been in the Treasury, I've been looking after serious bits of it. And I know all about budget constraints.

But if you really believe in 8 to 1, shouldn't we be spending much more?Or in terms of rates of return, various estimates, around 40%. And the final one is how do you use rates of return in allocation within your budget?Presumably, if the average is 8 to 1, there's some above and some below. That's the nature of averages. Um, are you shifting over towards those with higher rates of return. You using the more granular information from these kinds of analysis in terms of your, um, in terms of your allocations.
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None Portrait Speaker 2
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Okay. Um, so a number of things to pick up there. Um, you're entirely right that investing in research and innovation is a very uncertain business. And there is a lot of, um, judgment involved in that and expertise involved in that. That is why UK, I exists in large part. Um, indeed, Hera says that these decisions should not be taken by ministers. They should be taken by experts, which is why we have an arm's length body full of experts to make these difficult decisions.

Um, and as I said to Lord, Lord Winston earlier, the, um, the hard bit about being in UK is that for every five great ideas before we leave on the table, um, and. Uh, you know, that's difficult. That is hard. We um, our prescience may be no better than other people's. Uh, and so exactly knowing the rates of return in a very uncertain field in a sector that probably doesn't even exist yet, is hard for anybody to determine. Um, so there is a bit of historical historical data in this, but there is also a large part of subjectivity and judgment involved in knowing where to make decisions.

The, the, the, my, um, my counter to this is that you say, well, do we have the experience and the expertise to do this?Look at the country's industrial strategy in that you will find engineering biology as a sector, a growth sector for the UK, and a big opportunity for the UK only. So because the research councils are investing in synthetic biology 25 years ago, you will find quantum computing again, only a growth potential and high growth sector for the UK. Because the research councils have been investing in quantum concertedly for 30 years.

And so we do make long term decisions and we take risk. There was an Nao report into the risk appetite within Ukri and whether that balance is correct. And and I think that is a good challenge to us. Are we taking enough risk. Are we um betting on the technologies of the future. Because somebody has to. And if not us, then who. So, um, the, the root of your question about whether you can rely on a green book BCR, I think is right.

Um, Lord Willetts did a study into the business case process as applied to research and innovation and whether it was fit for purpose. And there were a number of recommendations that came out of that, um. Especially including related to the economic analysis and what stock we should put into an overall sort of aggregated 8 to 1 figure, and whether we should try to drive greater granularity. And I do think we ought, and I do think that does require us to look at things, as I've been describing in this session, about absorptive capacity of the supply chain and and market opportunity and the UK's competitive position.

So we do have to make an assessment against all of those in order to ascertain whether that is an 8 to 1 market opportunity for the UK or just across the sector internationally. So I do think that there needs to be greater granularity into that, but it is not easy. For sure. It is not easy. Then finally.
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None Portrait Speaker 11
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Not strategically.
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None Portrait Speaker 2
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Very happy to.
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None Portrait Speaker 10
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This was your plan?
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None Portrait Speaker 1
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I think, can I.
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None Portrait Speaker 1
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Baroness Jones.
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None Portrait Speaker 2
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Yes. So you can I take that very seriously. If you look at how our investments have gone over the last few years. Um, so over the last spending review period, um, London and the, and the Greater South East received the smallest percentage increase. Um every other part of the UK received larger percentage increases, the largest being Northern Ireland and the South West, for what it's worth, where it was over 50% budget increases in those two regions. So Ukri has, uh, you know, very determinedly diversified where our money is going, the north of England now receives about 20% of our budget as a comparator across all of Whitehall.

It's roughly 12%. So Ukri is, is investing more into um regions and devolved nations than we have done historically in absolute terms, that's more than £1 billion increase in in outside the Greater South east. So, um, we have taken that very seriously. However, um, as yet and there is a, you know, there's just a lag in you put investments into a place. It takes a few years before that, that investment has the benefit from it has really taken hold. So there is a benefit lag, but I would also contend that the benefit is not so acutely felt by those places, because the approach that we've taken historically has been to do a little bit of lots of things in lots of areas.

So, um, rather than specialising and aggregating and saying, okay, well, we'll do, um, quantum technology at scale in one place. We've done it in a very distributed way, um, or saying we'll do infectious disease in one place. It's done in a distributed way. So as we go forward, I would like, um, you know, like I say, the organisation has really taken seriously the, the need to use all of our muscles. If as a country, we're trying to lift a heavy weight, we're trying to say, well, let's, let's target economic growth greater than our G7 peers can achieve.

On what basis?We must have a basis for that target. And we must have an asset that we're trying to use to achieve that. And for sure, we will not achieve that if we don't use all of our muscles. You don't lift a heavy weight just with your bicep. You use your whole body to do it. So we must use all parts of the country in this endeavour and the regional disparity that does exist. We do have to address collectively, you know, collectively have to address that.

And Ukraine has a role in addressing that disparity. So we do take that very seriously. But I but I think that one way in which we could do that better is with greater focus in places. To that end, as part of this spending review, we created the Local Innovation Partnership Fund, which was a deliberate co-creation with places. So it wasn't us deciding what to invest in regions. It was a co-creation with mayoral combined authorities with city regions in the devolved nations to say, how do we work in concert, to specialise in a few things in your region and then do that concertedly behind which the rest of the UK MRI machine.

So investments in talent, investments in infrastructure, investments in commercialisation can all come in behind a specific focus. So identifying the focus was the first part. And that is what we've been doing with places over the last 12 months. The um the department recently took the decision to actually devolve that budget in the future. So now that we've gone through this co-creation work with ncas and with devolved nations in the next spending review, actually the money will go in directly to the the places rather than routing through Ukraine.

But, but we've established this much tighter collaboration with them to enable that.
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None Portrait Speaker 4
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Okay. Thank you.
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None Portrait Speaker 1
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Lord Willis.
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None Portrait Speaker 1
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Lord Berkeley.
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This debate has concluded
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