Parliament support for innovation is critical if the Government is to realise the ambitions in its productivity plan of making the UK the best place in Europe to innovate and the richest of all the major economies by 2030, according to a report published today by the Royal Academy of Engineering.
At a time of severe pressures on public finance and growing global competition, the Royal Academy of Engineering’s report sets out the case for investing in innovation to secure the UK’s future growth.
The Academy’s report – Investing in Innovation – says it’s vital that the Government’s industrial approach delivers a long-term strategic framework that enables the UK’s many innovation assets to interact in a coordinated way and gives business and other innovation funders the confidence to invest.
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Innovation is the process by which new ideas generate economic and social value. It is instrumental in delivering the economic and productivity gains associated with investment in research, and offers a key route to developing new tools and approaches for tackling major societal challenges and improving quality of life.
The UK possesses an outstanding research base and has many of the strengths required to excel in innovation, but the nation is engaged in a fierce global competition for talent and investment and cannot afford to rely on its past achievements to secure its future prosperity.
Both UK and foreign companies are increasingly making decisions on a global basis about where to site their high-value activities. With many of our global competitors adopting assertive knowledge-driven growth strategies, it is essential that the UK is seen to provide a favourable environment for investing in innovation.
In this highly competitive and internationalised environment, the role of government in providing an assertive, effective and long-term commitment to innovation is more important than ever.
Half of the UK’s productivity growth between 2000 and 2008 was attributable to innovation. Public investment is a critical factor in this success. Each £1 of public investment in research and development attracts private investment of up to £1.60, and the UK’s innovation agency, Innovate UK, runs schemes that return an average of £6 Gross Value Added for every £1 invested.
Academy president, Dame Ann Dowling DBE FREng FRS commented: “You only have to look at the UK’s world-leading small satellite industry to see the value of public funding for innovation.
“Government funding helped to establish Surrey Space Centre as a centre of excellence and enabled pre-commercialisation development for what became Surrey Satellite Technology Ltd. Now part of Airbus Defence and Space, it is a £100m a year business which has launched 47 space missions.
Dowling continued: “There is compelling evidence that the research conducted in our universities results in an enormous range of successful applications. However, innovation has a key role to play in ensuring that the potential in this world-class research base is actually converted into products and services of value to our economy and society.
“The rest of the world is in agreement that the capacity to innovate is the way to prosper in the 21st century. At a time of severe pressures on public finances and growing global competition, government should be investing in innovation to secure our future growth.”