Innovation: Government “could do better” according to EEF

Posted on 2 Nov 2015 by Fred Tongue

According to a new report from EEF, British manufacturers say that government support for innovation has "improved, but could do better."

The  Innovation Support Report Card, that uses the opinions of UK manufacturers, shows that in most aspects of innovation support there is room for improvement, with the UK often deemed to be trailing behind competitors. The report also says that the UK risks missing out in opportunities unless support for bringing innovation to market increases.

One area of innovation support that manufacturers’ support is the government’s tax credits for research and development. 62% of manufacturers have taken up the R&D tax credit, making it the most widely used support scheme for innovation, it is also the most highly rated on offer, 38% of manufacturers saying that the UK is as good as competitors while 12% believe the UK is a world leader when it comes to R&D tax incentives on offer.

On the other hand 60% of manufacturers say that the UK could do better on business access to scientific research and 58% believe that the UK does not keep pace when it comes to support for external innovation partnerships.

69% of manufacturers say that support for commercialising new technology could improve but highlight that recent improvements such as the Catapult centres, but further progress still needs to be made. The UK  looks set to remain an innovation follower as things are due, in part, to not bringing research to market.

One of the underlying concerns appears to be the amount of support out there, not the quality of the support. Over 90% of manufacturers who used support, how ever big or small that might be, say that it fully or partially met their needs. Of those who haven’t used support, 11% say that none of the support available addresses their needs or the challenges they face.

What is clear is that the Government still has some way to go if it is to achieve its aim of making the UK the best place in Europe to innovate. EEF is calling for its long-term commitment to continuing to build a robust and successful innovation ‘ecosystem’ in the UK, including a real term increase in funding for science and innovation and increased funding for Innovate UK.

Lee Hopley, Chief Economist at EEF, says: “If this was a school report the overarching message would be ‘improved, but could do better.’ Manufacturers tell us that there is much to be positive about but, while some areas of UK innovation support compete with the best in Europe, our inability to bring new research successfully to market continues to let us down.

“Although Government funding is being squeezed, it’s vital that business success generators – including innovation support – are allowed to continue to drive growth. This is particularly important given that the Government wants the UK to become the best place in Europe to innovate.

“If we are to achieve this then we have to build on existing innovation support to ensure top class performance across the board – the most successful nations do not excel in one area, they excel in many. This is an important lesson for the UK and it is vital that industry and Government work together to get a well-designed support system in place.”