Developing UK capability and creating wealth

1. Developing UK capability and creating wealth Graham Spittle Chairman Technology Strategy Board

2. Technology Strategy Board Vision ‘For the UK to be seen as a global leader in innovation and a magnet for technology-intensive companies, where new technology is applied rapidly and effectively to create wealth’.

3. Government targets • The Government has set a target of increasing • total R&D as a share of GDP to 2.5% by 2014. • The target for business investment in R&D is 1.7%

4. Business expenditure on R&D as a proportion of GDP, G7 2.5 Japan 2 US Germany OECD average 1.5 Business expenditure on R&D as a proportion of GDP, % France UK 1 Canada Italy 0.5 0 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 Year

5. What do the figures show? • Total R&D as a proportion of GDP was 1.78% in 2004 • against an OECD average of 2.26% • Business R&D as a proportion of GDP was 1.15% • well below the OECD average of 1.51%

6. What do the figures show? • In 2004 • R&D performed by the Government increased by 0.5% • on 2003 in real terms. • R&D performed within universities and other higher • education institutes increased by 4% on 2003 in real terms. • R&D performed by the business sector fell 3% on 2003 in • real terms. • We need to improve

7. What do the figures show? • Latest Innovation Survey shows UK moving in the right direction in terms of firms developing novel products and processes - • 29% of businesses say they have introduced new products • up from 18%. • 19% of businesses say they have introduced new • processes up from 15%. • 66% of businesses were engaged in some form of • innovation activity up from 61%.

8. Number of factors influencing business • Main factors influencing the business environment: • Relentless pace of technological development. • Globalisation of the world economy. • Restructuring of the UK economy in favour of high value, • knowledge-based design, manufacturing and services. • To respond to these challenges companies must: • Constantly strengthen their capabilities. • Embrace technological innovation. • Find innovative ways to satisfy customer demand.

9. Focus of the TSB • The Government’s 10-Year Science and Innovation Investment Framework is aimed at ensuring the UK remains internationally competitive. • TSB role is to drive business R&D as part of a National Technology Strategy • Operates across Government helping to create engagement between business and Government in specific areas of opportunity

10. Selection Criteria • UK Capacity to Develop and Exploit the Technology • Potential for Impact and Timescale • The Size of the Global Market Opportunity • A Clear Technology Strategy Board Role

11. What are we funding already?

12. What are we funding already? • Over 360 projects already approved for funding • Represents over £580m of R&D activity, Over £270m provided in Government support • Programme has undertaken • over 9,000 Outline assessments • 700 Full stage assessments • from over 10,000 applicants • 20 Knowledge Transfer Networks

13. Nanotechnology for sustainable water purification • Using sunlight to treat dirty water and create electricity simultaneously Key Benefits • Solar powered catalyst purifies contaminated water • Able to generate electrical current • More cost effective and environmentally friendly than existing technology • Can treat both chemical and biological contaminates

14. Therapeutic products from human stem cells • Viable therapeutic stem cell treatments for serious diseases Key Benefits • develop treatments for patients with diseases such as Parkinson’s disease and stroke • dramatically reduce the demand for and cost of long-term nursing care • the creation of generic processes will make future cell- based medicines easier to develop and more affordable across the industry

15. 3D scalable integrated displays Cost effective and scaleable 3D display system that could revolutionise the way we are taught, the way we work and maybe even the way we relax in front of the TV. Key Benefits • three-dimensional images that can be viewed on a flat TV screen with the naked eye • improves the quality and realism of flight and other visual training simulators • revolutionises the visual media and entertainment industries

16. Other examples • World’s first fully environmentally clean sports car based on a Morgan sports car • Converting mixed waste plastics back to basic refinery and petrochemical products • Grid-computing infrastructure to share data between geographically dispersed computers • Acoustically advanced materials that reduce noise in the working environment • Faster and more efficient optimisation model to deliver substantial performance improvement in 3G networks

17. Changes to the competitions Listening to your feedback • Fast Track for projects seeking £250k or less support - faster/lighter single-stage process • Large Projects seeking support above £8m - provides opportunities for larger projects without being constrained by indicative levels for each technology area

18. Focus of the TSB • Development of key technologies • to underpin the high value added areas of the UK economy • to generate new streams of economic activity in their own right • strong market focus • Development of “innovation platforms” • the integration of a range of technologies • combined with better co-ordination of policy and procurement instruments • to deliver in a step change in UK performance

19. Key Emerging Technologies Approach • Seven key technology areas selected • Develop medium term strategies for each application area • Validate the seven areas with business and government • Determine the appropriate support • Energy strategy to be published post Energy Review

20. Key Technology Areas Electronics and Photonics Advanced Materials Information and Communication Technologies Bioscience and Healthcare Technologies Sustainable Production and Consumption Design Engineering and Advanced Manufacturing Emerging Energy Technologies

21. Developing UK Capability – published today We want your input

22. Key Technology Areas • Input from 600 businesses already to help shape initial documents • Want wider input by end May • Detailed discussion documents on the key technology areas can be found on the Technology Strategy website – www.dti.gov.uk/technologystrategy

23. Focus of the TSB • Development of key technologies • to underpin the high value added areas of the UK economy • to generate new streams of economic activity in their own right • strong market focus • Development of “innovation platforms” • the integration of a range of technologies • combined with better co-ordination of policy and procurement instruments • to deliver in a step change in UK performance

24. Innovation Platforms • Innovation Platform • A societal challenge bringing together a range of technologies and • policy levers to deliver innovative new products and services for • which there are real customers in a potentially large global market • Brings together government stakeholders/funders • Engages with business and the research community • Identifies the appropriate levers to use • Links research to market through procurement opportunities

25. Innovation Platform pilots • Two pilot Innovation Platforms • Network Security • Intelligent Transport Systems & Services • Initial investment of £10 million for each Platform

26. Innovation Platform update Network Security • Steering Group established including representatives from the • TSB, Home Office, Cabinet Office, MoD, DTI and the Cyber • Security KTN. • Cyber Security Knowledge Transfer Network leads the Platform’s • community of business interest with 350 businesses engaged. • A summary of challenges is currently being drawn together as • the basis for an action plan. • Business challenges have been identified and several working • groups established to identify how to take these forward from the • business perspective.

27. Innovation Platform update Intelligent Transport Systems & Services • DTI has committed £6.5m over the next five years to support the • innovITS business-led network. • Business challenges are being identified through engaging with • business • Transport Innovation fund launched by Department for Transport in • July 2005 supports the development of transport schemes that • feature demand management. Funding of £290m will be available • in 2008/9, increasing to £2.5bn by 2014/15.

28. Challenges • Creating a step change in UK innovation – • 2.5% target • Joining up activities across Government • Giving business headline indications of future • Government procurement activity

29. Opportunities • UK a global leader in key technologies & markets • and in challenges facing society • Provide a common agenda and focus for activities • across government • Maximise government impact by creating a visible • route from blue skies research to procurement • opportunity • Changing economy – supporting the service sector/ • creative media

30. We cannot do this alone • We need - • Government Departments to provide the challenge and • support the opportunity with funds and expertise • Regional Development Agencies and Devolved • Administrations to stimulate the demand and create • the conditions for success, and……

31. We cannot do this alone • We need - • business to play its part – • engaging with the work of the Board • providing input • putting innovation at the centre of their • strategies

32. Developing UK capability and creating wealth