Question to the HM Treasury:

To ask the Chancellor of the Exchequer, how he plans to increase private sector spending on R&D in order to meet the 2027 target announced in Budget 2018.

The Government is committed to maintaining the UK’s position as a world leader in science and innovation and has introduced a wide range of policies to stimulate private sector investment in Research and Development, ranging from increases in government funding of R&D to improvements to the wider institutional and tax environment for R&D and a new patient capital investment programme. Internationally, the UK is a highly attractive place for R&D, ranking 4^th on the 2018 global innovation index.

Since 2016, the Government has committed an additional £7bn of public funding to R&D by 2021-22. This is the largest boost by any government for 40 years and will leverage significant private investment. On average, every public pound spent on R&D generates an additional £1.36 of private spending. In addition, support for businesses through R&D tax credits has tripled since 2010, reaching £3.5 billion in 2016/17.

At Autumn Budget 2017, the government announced a 10-year action plan to unlock over £20bn to finance growth in innovative firms, including launching a new £2.5bn investment programme, British Patient Capital, and extending the Enterprise Investment Scheme (EIS) and Venture Capital Trusts (VCTs).

Taken together, these policies will accelerate private investment in R&D, building on the healthy real-terms growth of 26 per cent we experienced between 2010 and 2016 (the last year of official data).