It gives me great pleasure to welcome to this public session today’s two witnesses, Lord Vallance, the Minister for Science, and Alexandra Jones, director general for science, innovation and growth. Lord Vallance, your portfolio is of huge interest to this Committee, as you can imagine, and we are very grateful to you for giving us so much of your time this morning. We have a wide range of questions, as you possibly anticipated. It is a testament to the work that the Department is doing that there is such great interest among Members. A couple of Members are unfortunately unwell or they would have been here today too. We will get through the questions as quickly as possible. I would really appreciate your giving us as comprehensive responses as possible. Given that this is your first seven months into post, and it has been a very interesting seven months, how would you assess your first seven months in the job? As someone who was previously the chief scientific adviser to Ministers, including George Freeman here, what are the challenges in going from advising on policy, as a chief scientific adviser, to making it as a Government Minister?

Thank you. It is a great pleasure to be here and to have an opportunity to talk about this area. I will start with the second half of that question. Clearly, the role of the Government chief scientific adviser, as you rightly say, is to advise. It is to advise on science for policy. It is about making sure that policy is well-informed by science across Government, whereas this job, of course, is around policy for science; it is the other end of the spectrum and it is about making decisions. That is a transition; it is different. There is some overlap. I am very conscious of the fact that we have an excellent Government chief scientific adviser and she should be allowed to get on with her job without me getting in the way, and she does. I am also conscious of the fact, as somebody said to me, that I cannot advise myself. I am grateful for the advice I get from officials and from chief scientific advisers and the national technology adviser. In the first seven months, as you say, a lot has happened. I am pleased we had a good spending review settlement, which was during a very tight budgetary situation. It was important that we did. It reflects how Government perceive science and technology as an important part of an economic growth story. That is good news. We have made progress on UKRI and Innovate UK, for both of which we hope to be announcing new chief executives shortly. I am very keen to make sure that we have a very clear view of the different activities that UKRI undertakes. I am happy to say more about that in due course. We also have the Regulatory Innovation Office set up, which has begun to work with regulators in a number of areas. Again, I hope that we will be appointing a chair to the Regulatory Innovation Office shortly as well. There is a lot that has happened on the structural side of things. The area I would probably then highlight is the missions R&D fund that we have put in place, which is very important. I would like to make the notion of using science and technology a routine in government, rather than something you go and look at when you think you have a specific science and technology problem. What we are doing with that programme is to ask the mission boards, “What are the three or four top problems that you have that, if you could solve them either through knowledge or through a product or a technology, or something else, your mission would go faster and be more effective?” From that, we are taking an R&D challenge, which is, “Okay, if that’s your problem, this is the R&D challenge,” and we will then bring together the necessary players from industry, from charities, from academia, whoever it might be, to try to address that question with a very targeted approach. That does two things. It means the R&D is completely focused on something the Government care about and it does so in a timeframe relevant to the decision making that Government have to make. Secondly, it provides a very clear pull factor for the R&D contributors, because the mission board has said, “This is a big problem and, if we can fix it, we’ll do something about it”. You have a potential procurement pull link, which will be a magnet for private sector coming in. That is early days and it is just getting off the ground, but I think that is important.

How much is that fund?

The initial fund in the first wave is £25 million.

The first wave.

That was the one-year programme. The chances of us being able to spend more than that in the first year are limited, but we will ramp it up quite significantly.

Thank you. You have raised a number of issues that we will return to. I want to talk at a higher level. A lot of the headlines coming out of the Department—this week we have the AI summit, for example—have seemed to be on digital policy. That obviously follows on from the changes to the machinery of government, which we will come to. Given the focus on digital policy, if you agree with that characterisation, how do you make sure that the science priorities in the portfolio make progress?

It is quite right that the Department is focusing on trying to get some of those digital things sorted out across Government. They are absolutely crucial and they are crucial for the way Government works, for the way public services are delivered and, indeed, for the economy. That is absolutely right and it is good that it has come into one place with a cross-Government view. It is worth saying that, of the Department budget, £13.9 million[1], the vast bulk of it, is for science and technology. There is no question that science and technology is the major funding position of the Department. My job is to make sure that science, technology and the innovation that stems from that are properly reflected in what the Department does.

Fantastic, thank you.

Morning, Patrick and Alex. This is a linked question, on the science and technology framework. First, may I say, Patrick, what a joy it is to see you in post and the continuity that it brings? As you know, I tried to do the job in a cross-party, long-term way. This agenda and this Committee are very focused on long-term policymaking. Just for the record, I wanted to say how great it is to see you in that role, to deliver that. One of the things we worked together on was the science and technology framework, which was a really important, unglamorous statement of the importance of building a cross-Whitehall commitment, anchored in No. 10 and the Cabinet Office, to drive the harnessing of science and tech for industrial and competitive advantage. I want to link this to Chi’s opening question. In the industrial strategy that the Government have laudably, in my view, made a commitment to, we have not heard much about the science research harnessing it for industrial benefit. Does the framework still survive and, in particular, how do we drive the cross-departmental commitment? Regulation—I know DBT is the lead Department. Yet, the regulatory office is in DSIT. In Defence, a key adopter, space defence, for all sorts of sensible reasons, keeps itself to itself a bit. How are you going to drive the industrial strategy in science across Whitehall through that framework?

Thank you. The first thing to say is that, as you know, I feel quite attached to that framework. You are right, it is unglamorous in a sense, but it absolutely is the systems approach to how you get this right. It was widely welcomed by industry.

Yes.

It has been reaffirmed as the foundation of what we are doing in this Government. That is the way that this will be considered; it informs every aspect of the industrial strategy. It is very much at the centre of how the industrial strategy is being constructed. Of course, two of the sectors are directly DSIT-led, life sciences and digital and tech. Several of the other sectors have major DSIT input. But you are right, this is a cross-Government activity. The aim of the framework and the aim of what I described in the missions programme is to get science and technology embedded everywhere. Of the total R&D budget, the public R&D budget, £13.9 billion is DSIT, but there is nearly £6 billion, which is across the rest of Government. This has to be about taking science and technology into every aspect of the industrial strategy. It cannot, in my view, be an economy that grows faster than average if it does not have science and technology companies at the very heart of it.

Thank you. I painfully agree. The question, having tried to do the job, is who leads it. Inevitably in Whitehall, you get departmental fiefdoms and competitiveness. Is it the Prime Minister or the Deputy Prime Minister? Is it you? Who in Government bangs the table and says, “Action 14, has it been done?”

The Science and Technology Committee, which is a Cabinet sub-committee, is a prime ministerially chaired sub-committee for exactly that reason. You will remember when that was set up, for precisely that reason.

Yes.

The second thing to say is that DSIT is not a vertical Department only. It has some sort of vertical traditional things it looks after, but it has a very major horizontal component. The Secretary of State has been clear about that horizontal role. The Prime Minister has been clear that he wants the Secretary of State to drive that horizontal role across Government, across all Departments. There is a clear mandate to do that, and there is the Science and Technology Committee, as a vehicle, to then bring that back to prime ministerially chaired leadership.

Which is encouraging. We need not worry that the new DSIT framing, the digital department, means that the hard wet science, the robotics, the agri-tech, the space, all that hard stuff, will be deprioritised within DSIT as a new digital department.

You would be surprised that I would sit in this role if that were the case.

Thank you.

Can I clarify, Patrick? Did you say that two of the critical technologies were led out of your Department?

Yes.

And that was engineering—

The two sectors, yes.

The sectors, or the technologies.

Or the technologies, sorry. The industrial strategy—

Sectors—the two of them.

The sciences and digital and tech.

In the S&T framework, for the benefit of new colleagues, there were 10 workstreams, I seem to remember. Is that right? I think DSIT leads on four or five of them. It could be seven of them, I can’t remember. Can you remind us?

It is not operating in that way. In other words, we are not trying to have each of the 10 things owned being pushed individually. We are saying that the whole of the framework needs to be applied to every part of the industrial strategy.

One of the things we have in the industrial strategy and the growth mission, as Patrick was saying, is an innovation cross-cutting strand, which DSIT leads. We look across the different sector plans and the work we are doing on growth. We are looking at what are the barriers to innovation, and what are the enablers of innovation and how we do that; it is that support. We have the lead on two sectors of the industrial strategy and we lead on the cross-cutting innovation that is exactly where some of the conversations about R&D happen. Then the sectors look at the S&T framework, as they think about their plans.

In each Department, do they have an innovation lead to work into the innovation cross-cutting stream?

Within those sectors, we have leads who are putting together the whole plan. Innovation is very much a part of that. Then there is a cross-government structure very much mirroring it; we have the S&T committee and a cross-government structure. We have leads in each Department we are talking to, to make sure we think about innovation across the Department, and then the sector leads might be slightly different. We have a way of doing that, yes, across Departments.

Where would those innovation leads sit?

It depends on the Department.

Not necessarily within the chief scientific adviser’s?

Often it does. We have a group that meets across Government at official level that brings together CSAs and policy leads to make sure that we have all the right people in the room to talk about those investments.

Last question: if we want, as a Committee, to monitor the implementation of the framework, the success in harnessing science for industrial gain, is there a dashboard? Where should we look? Is it the Cabinet Committee? Is it you, Patrick? Who is the lead and where should we look to hold you to account?

You hold me to account by holding me to account. I don’t think it is right to think of how you monitor the framework. It is right to ask how you monitor the industrial strategy and the application of the framework in that.

Right.

There are some specific things that are worth looking at, such as regulation. You rightly pointed out that DBT owns regulation overall. We own the Regulatory Innovation Office. The reason we own that is that the Regulatory Innovation Office is specifically about how you think about high-tech, emerging technologies and regulate those. It is a rather specific area. We work very closely with DBT on that, but there are some features that make it appropriate that it sits in DSIT. Procurement is the other one, which, as you well know, is a major issue for science and technology. How do you get procurement to give pull-through? I alluded to it in relation to the missions programme. I am also working very closely with Minister Georgia Gould in Cabinet Office to try to push an innovative procurement programme. Procurement from SMEs has been something that Government have traditionally found very difficult to do.

Yes.

We have to do it if we are to get the signals right for them.

Thank you. Chair, I am conscious that there are lots of questions.

Yes, thank you very much.

Thank you, Patrick, for being here, and Alex. One of the key things that I am sure is on your plate are the changing geopolitics and attitudes to different science and innovation across the world. In particular, in the last few weeks, we have seen the hollowing out of NIH. We have seen differing attitudes to vaccines, stem cell research, particularly coming from our friends in America. I want to understand how we look at those in your Department, in the spending that MRC does in particular, and in some of the other research councils; how we see it as a challenge to some of our ambitions, particularly in life sciences; and how we also see it as opportunity. Could you talk me through a little bit of your thinking around how we are reacting to the changing attitudes?

Yes. I have laid out five priorities. One of those is international for obvious reasons that, although we are an island, we cannot be an island when it comes to science and technology, which is fundamentally an international activity. I am very pleased about our association with Horizon Europe, that we are back in Horizon Europe, and that we have those links to Europe and the potential to drive new collaborations. The pick-up on that has been good. We are now in a much better position regarding the number of people back in Horizon. The European scene is looking good. We obviously have challenges elsewhere in the world. In China, we need to work out exactly what our relationship is. China is, by any measure, a science and technology force to be reckoned with. We collaborate in areas such as healthcare and climate. We will continue to do so, but are aware that we need to be careful about how we do so. The US has always been our biggest partner in terms of science. It continues to be so at the scientist-to-scientist level. We have lots of things going on. I am sure there will be change. We can see change already and we do not yet know what the consequences of that will be, but I have no doubt we will continue to work very closely with the US on aspects of science and technology. We work closely with them on quantum, engineering biology and things they are interested in and we are interested in. I have no doubt that, as things settle at the NIH, we will work out what the relationship is and how we can best continue doing what we have done very successfully over many decades.

To push you a little further on that, does this present an opportunity for the UK to step forward on areas that quite clearly the new Administration are not comfortable with federal funding going into? Should we be looking at increasing the amount, maybe through MRC, to fill that void and take advantage of that opportunity?

Companies will do what companies do. We already have a number of life sciences companies working here, new companies that have come here. I have no doubt that we will also see movement of people around various changes in different countries, and they will want to come to the UK. The UK has always been a good place to do research. Our health funding is strong through NIHR and MRC, and I am sure that will not go unnoticed.

Given those opportunities and given that we are an attractive environment, do we have the right strategies to attract that global talent to the UK? Should we be looking at additional incentives to attract some of those scientists over to our shores?

If you look at the history of science in the UK, we have always relied on immigration of top talent. We will continue to do so and, therefore, all our systems must be geared to do that. The question of how we get the visa system right is important. I was very pleased that the Chancellor, a couple of weeks ago, said she wanted to push the visa system to be welcoming to scientists and engineers. The Migration Advisory Committee is looking at that and reading out over the course of the summer, and there is the Home Office White Paper. There are lots of things going on to try to make sure we get that right. It is important—I think this is what you are getting at—that we have schemes, both in the university sector and in the funding through MRC and NIHR, that are attractive to people who want to come here. If you look at our Nobel prizes, we have been very reliant on people who have come in and worked in the UK. We have done incredibly well out of that and we should continue to do so.

Leading on from that, do you have a specific message to American scientists or, I should say, scientists resident in America who may be concerned at the direction that science funding and science esteem is going in the United States?

I do not know yet what is going to play out in the US. We will see how that evolves. What I will say is that scientists, great scientists, are welcome in the UK. We will welcome people to positions in universities and elsewhere, and our funding schemes will support people.

Thank you. We now move on to AI.

Thank you for being here today, Minister. It is great to be able to talk about these things. I come from a long background in digital technologies and worked in mobile phones and all that sort of stuff for a long while. I worry about our generic use of complex terms such as “AI” and “quantum computing”. What people talk about as AI today is not AI; it is purely the adoption of natural language processing, large language models, 40-year-old ideas on neural networks I learned at university and the ability to actually have enough processing power to put all that together to create a generative pre-trained model, ChatGPT. We are seeing that copied and we see it come out in DeepSeek. We see it becoming almost usable in just about anything. How do we address regulation in emerging digital technologies, when we do not quite yet know what is coming round the corner? How prepared are you for the emergence of alternative AI, the next generation of AI in its—to use the term badly—neural network and large language model and processing? I do not mean the general AI, which is what AI really is. How prepared are we for the introduction of Google’s Willow chip? Willow is the quantum computing chip they announced on 9 December last year, which, if we believe the press releases, will be a fundamental, incredibly high step in processing power. We know that quantum computing, if they have it and if it works, destroys encryption.

Yes.

We have some really fundamental potential areas. At the moment, we appear to be trying to regulate the technology and not the use. You do not regulate a wheel; you regulate the car. What is the approach we are taking in an area where we could be seeing some huge steps taken very quickly?

There is a lot there. Last week, I was pleased, as chair of the Queen Elizabeth prize for engineering, to be able to award the prize to seven people for modern machine learning. Precisely to your point, it was not AI; it was modern machine learning. That was four people involved in the algorithms and the neural networks, two people involved in the chip design, which allowed that to happen, and one person involved in realising that you need good datasets for the machines to learn on. I agree with your point about nomenclature; it is rather important. There is a generic AI bias, which one has to be a bit careful of, because it also comes as a generic AI anxiety, which is not true when you are thinking about narrow AI models and other things. We need to be careful about how we use words; I agree with that. Your point is right. This technology is moving extremely fast and there are many people predicting when we will get to artificial general intelligence. Some people think it is a decade or more away, others think it is a year or two away, and lots of people think it is somewhere between the two of those. That is why the AI Safety Institute was set up: to try to get ahead of some of these things and to work with the developers to test models as they are evolving. The AI Safety Institute has done that and developers have worked closely with it. AI safety institutes have been set up in several countries now. There was a big meeting of the AI safety institutes themselves in November last year, in California. There is an attempt to try to get to what is happening, what does that really mean in terms of where these will go, and how we can work with developers at the beginning to look at problems that will arise. Your point is right; if you over-regulate in fast-moving technologies, you kill them. We cannot over-regulate, but if you miss it, you have a problem as well. Being expert and being engaged is what the AI Safety Institute is doing. The reason that we have the Regulatory Innovation Office is to try to pick up on the fast-moving technologies and ask use applications what needs to happen to get that right. I take one issue with one thing: we are, at the moment, regulating specifically on use. That is the approach we are taking. We have said that there will be a legislative approach to the most cutting-edge frontier models—as you go towards artificial general intelligence. That is the one that we will consult on, to work out exactly what it needs to look like. The AI Safety Institute will be put on to a statutory footing as part of that process. As you know very well, there is a big race in quantum going on. One of the big challenges is error correction. Quantum computers make lots of errors. How you correct that will be key to the success story. We opened the National Quantum Computing Centre towards the end of last year, in Harwell, which has six different quantum computing modalities all in one building. The reason for doing that is that it is not clear yet what will win or, indeed, what will win for which purposes, because it may well be that one technology is good for one thing and another for another. What the quantum computing centre does is allow people to come in and play around with them and find out what works. It allows people who are working on error correction to think about what error correction you need in different models. We are in a good position. Other countries have looked at the National Quantum Computing Centre and see it as something at the cutting edge of this. We will see what happens with the various claims. There are lots of claims on quantum. Error is the big challenge. You are right: a fully working, scaled quantum computer would break all conventional crypt. As you are aware, quantum-resistant crypt is now being used quite extensively, and is very difficult for quantum computers to break. But it does mean that for historical data, you would still be able to break it and look at it in an instant.

We are committed to bringing it forward in the legislative programme, and in due course we will be launching a consultation on it to get information. I cannot give you any more timelines on it at the moment, but it is something that we will do and it will be limited to frontier AI work, for the very reasons we discussed; most AI should be regulated at the point of use, the application of it. The question is: what is the appropriate regulation for that cutting-edge work? What are the things you need to be careful about? That is where I think the AI Safety Institute has a big role to play. It is important that the big, advanced companies want to work with the AI Safety Institute. That is a really important signal. There are examples of things the AI Safety Institute picked up that have been iterated with companies, and I think that is what we will see going forward.

As I said, there is no Bill at the moment; there is a series of discussions around what it might look like, and there will be a consultation in due course. At the moment, the AI Safety Institute is going ahead exactly as it always has, and I am sure that discussions will be taking place today in Paris on those sorts of issues.

Nothing to add to that.

Our position would be that you should always think about where you are putting your data. DeepSeek is interesting in the sense that it has shown that there will be more than a handful of companies creating large language models. That is likely to accelerate, and will accelerate innovation as well. We have already seen that DeepSeek has the potential to use less energy than other approaches, so we welcome the notion of disruptive innovation occurring there. We are not going to put out guidance on which ones people should or should not use, but offer a general point: just be aware that when you are putting your data into any of these models it is by definition being used, so they will be able to see it.

The Secretary of State has said the same. This shows that innovation in this space is pretty strong. We have lots of innovative companies in the UK and they will be part of the story. I think there was a narrative developing that the whole thing was going to be two or three companies, full stop. Clearly, that is not the case.

You didn’t mention the European Union in discussing AI regulation. There has been some criticism of the European Union’s AI regulation model at this week’s summit in Paris, which goes beyond what you set out around regulating frontier models in regard to safety. Does this mean there will be divergence between the European Union and the UK with regard to AI regulation?

We are definitely taking the approach of trying to regulate the use, which is a bit different, but we will look at the frontier models. It is pretty pointless ending up with completely bespoke regulation in one country, because this is a global area. We are working very closely with the EU and the US and looking at where there are opportunities for harmonisation. The experience in regulation generally is that you get divergence at the beginning, when people are trying to work out where to go, but quite quickly you need to harmonise around it so that we have clear, consistent rules that allow people to develop international products. Standards will be an important part of that, so it is not just regulation; it is also which standards come through.

I think the Secretary of State and the AI action plan talk about open source and open standards as a pillar of regulation going forward.

We are very keen to keep things open. We are also very keen to make sure that we put the appropriate protections in place for data so that people get the value they deserve from the data they have. That is completely true for public sector data. As we make it open and accessible for people to innovate with, we also have systems to get value capture back, so there is a lot to be done to get the business model right around data.

To go back to the S&T framework and regulation, you are making an important point about regulating by use. AI in healthcare, which is widely used for drug discovery, is important but rather different from AI in the creative industries. In that regulatory matrix, how are those tensions resolved? How does a Government who want to be pro-AI, but not damage our creative industries, manage the clutchplate of wanting to fast-track it for health purposes but DCMS, rightly, wants to protect creatives? Where does that debate hit in the government machinery?

As you say, there are differences in specific use cases, and the debate around the creative industries is clearly around copyright at the moment. It is worth saying that in one sense copyright is straightforward. If you copy something, you have broken copyright. You cannot take an image and reproduce it, just as you cannot read a book and say, “I’m going to put great chunks of that book into my book.” That is not where the debate should be, because that is clear. The debate is around web-scraping, where an AI machine may look at hundreds of thousands of books to try to understand how to write a book. That is where the debate is. We have been very clear that what we want to do with the legislation—there are technologies that can help with this—is give more control to the creatives; we want to give transparency in the system. What has been used, and for what purposes, and can you track that through to the output? We also want to make sure that you get access to be able to train these models. After all, the models are used very extensively in the creative industries.

Will the judgments about where to regulate fast and slow and how to get that balance sit with the new chair of the innovative regulatory unit?

No; they will sit with existing regulators in that space. For AI in healthcare, though, a specific strand of the Regulatory Innovation Office is looking at that now. What the Regulatory Innovation Office will do is work with regulators to ensure they have the capacity and capability, give money for training and share best practice among regulators.

We are going to move to an area that is very close to my heart and indeed that of the Committee, as it is the subject of one of the inquiries we have launched, on innovation, growth and the regions. It is also very dear to the Government’s heart as economic growth is a main mission, and that growth is to be shared across our regions. We had Dame Angela before the Committee a couple of weeks ago. She told us it was hard to find evidence linking innovation and economic growth. As the Minister responsible for tech and innovation across the missions, do you agree?

I am slightly baffled by that statement. Seven of the 10 biggest companies in the world are science and tech companies that have innovated extraordinarily in what they have done, and they are growing faster than other companies.

I guess that is company growth and that would be, if you like, one set of data and research on the link between companies growing. By growth, do you mean revenues rather than stock valuation? What we are mainly concerned with is economic growth: the link between innovation at company level, but also at the public research and development level, and economic growth on a regional or national basis.

If you look at where the companies are, those countries have the fastest economic growth as a result of those companies. It is very clear that there is a relationship between innovation, particularly science and technology companies, and economic growth at national level. It is also true at local level, but the local level is interesting. If you look at what has happened in Silicon Valley, there has been huge value creation and economic growth in Silicon Valley, but there has been an enormous amount of economic growth elsewhere in the US as a result of that, because many of the production facilities and companies that have spun out from Silicon Valley are based in other places around the US. Therefore, you end up with growth much more widely distributed than in just the cluster itself.

You are saying that growth in Silicon Valley has caused growth elsewhere. In the UK, most of the innovation, certainly the R&D funding, is focused on our golden triangle. Are you saying that growth in the golden triangle generates economic growth elsewhere, which I think we would agree with? Is part of your mission looking at tech and innovation across the missions for growth, to look at innovation driving growth within the regions as well?

Very much so. It is true that we have a massive concentration of very high-end R&D in Oxford, Cambridge and London, but we have areas elsewhere in the country that are absolutely flourishing with this. Manchester is doing an amazing job; Liverpool is doing a great job; Newcastle is doing a great job.

I was waiting for that.

Edinburgh has a very flourishing sector; Dundee has some great stuff going on. It is quite distributed across the country as well. As well as making sure that we harness the full value of what we have in the Oxford-Cambridge growth corridor—it is important to make sure we get full value from that—we are looking at what we do to support innovation across the country. I have had discussions with mayoral strategic authorities about how we can best support them, giving more local control over what the innovation should be, because they know what is happening in their areas; they know what the infrastructure growth plan is and what they are going to do on transport and other areas. We should enable science and tech innovation to occur in line with what they are trying to do. Manchester and other places have done a really good job of joining that up. There are many areas across the UK where we will see growth from innovation.

The Committee visited Liverpool to see their approach. We were very impressed by their approach to driving innovation. In the north-east we very much welcome the Chancellor’s encouragement, and setting up an investment innovation pipeline in our region with our regional mayor. Steven and George have particular questions on regional growth. The £24.4 billion was hard won from the Chancellor. How can this Committee, and the country, measure the value for money of that investment across our country? In a year’s time, what would you expect us to be able to point to and say that it has driven growth in our regions?

I am second to none in my admiration of a previous science Minister, David Willetts, but I disagree with something he said in the House of Lords recently. He said that the job of the science Minister was to ensure you get the biggest budget for science. Of course, I would like to get a big budget, but that is an input measure. What we need to ensure is that we have the best possible use of that money to get the maximum effect for the UK. I mentioned briefly my five priorities. I will spell them out, if I may, because they speak directly to this topic. The first thing we need to do as a country is protect and grow, as the economy allows it to grow, basic curiosity-driven, investigator-led research. That brings no economic value in the next five years, but it is a thing people will be extremely grateful for in 20 or 30 years’ time. It is something we are really good at and we must absolutely protect it. We are known around the world for it, and it is the foundation for everything else. The second bucket is more applied research which should be aligned to Government ambitions: the growth ambition and industrial strategy missions. Not only would you expect that to be aligned to Government missions and approaches, but you would expect to get leverage of at least 3:1 private sector funding to go alongside it, and you would expect to see the development of infrastructure required for it, including testbeds, skills and other things. The third area is companies. We have done very well recently in company formation; we have lots of start-ups. Many of them are under-capitalised, which is a problem, so we need better, well-funded start-ups. We need to scale those companies. We know that is a big gap in the UK. We have failed to scale companies, so we need to make sure that our money goes into helping the transition from start-up to scale-up; and we need to support our big R&D-intensive companies. Those are the three funding buckets. My other two areas are that all of it is to the purpose of the citizen. We must not lose sight of the fact that we are doing it because we want lives to be better and we want people to feel as though they have opportunity as a result of this. The fifth is the international one that we worked on. Those are the areas. The reason for spelling that out is that I want it to be much clearer going forward what proportion we are putting into the first three, and why. That would allow this Committee and others to say, “What are we getting back?” On bucket one—curiosity-driven basic research—can we just accept that that is something we are going to do and let’s not have false promises around economic growth from that in the short term? It is knowledge creation and the cost of doing business. For the second one, we would expect to see a 3:1 ratio of private to public. For the third one, we would expect to see companies not only starting in this country but scaling, staying here and getting inward investment from UK investors as well as international investors. There are metrics in there that I think are those we should focus on in terms of economic growth, and that should be around the country.

I am sorry you didn’t mention Exeter in your tour of the country, which means that we need you to visit to see everything that is going on.

I grew up in Cornwall. I know Exeter very well, including the wonderful Met Office there and the opportunities around that.

You mentioned the 3:1 crowding-in of private investment for public investment, but in 2021-22 UKRI spending was 1.7% in Wales and 6.7% in the south-west, for example; and 52.8% in the south-east. Public spending is not equally shared around the country. Can you explain what your role is and how you see that going in the future?

The reason I want to get greater clarity on the three buckets of spend is that I do not believe that the basic curiosity-driven science will be equally spread around the country. It happens in certain places more than in others. That is likely to be the case, and probably always will be. You have real hotbeds where it can happen, with certain bits of equipment and a certain critical mass. You would expect the other two buckets to be much more spread. When we look at where things are, that is how the Committee should be able to look at it. At the moment, it is quite difficult for the reasons you give. When you look at a figure of 1.7%, or whatever, that is of a total amount. That is probably not the right way to think of it, but it is the right way for certain buckets. You would certainly like to see the spend on company formation to be appropriate around the country, although you may see certain types of companies in some places and not in others; and you would certainly expect the spend in the second bucket of things that follow Government missions to be absolutely spread appropriately around the country as we think about what needs to be done. There is a reason that most of the climate work will come to Exeter, because you have the fantastic public sector research establishment there.

If the private sector investment into innovation, start-ups, and so on, largely follows the public funding, we simply will not be able to rebalance the economy if we do not make a better attempt at making sure that where we have the innovation, like in Exeter or Manchester, we properly support it rather than focusing on areas that are already successful and might already get private sector funding.

Yes. Again, I don’t think private sector funding is going to follow the basic curiosity-driven science, so can we park that? At the moment, that is in all the numbers. You are not going to have lots of private sector money coming in on that. You will have some because they want to do it. It is the other bits where we should look at it and say, “Are we getting the right amount of spend for the opportunity there?” It is opportunity and spend that need to go together. I really want to be clear about this because of my role on the Oxford-Cambridge growth corridor. As a nation, we will be doing ourselves a massive disservice if we do not deliver on this, because it is a huge growth opportunity for the country as a whole. That is not at the expense of making sure that we do clusters and things elsewhere. It is just obvious, to me anyway, that you must get that right. I spoke to somebody about international brand recognition, which investors and others are quite keen on, and, of course, you do not have to explain that you think that Oxford and Cambridge have pretty good substrate to start with, but I was surprised to learn that the Chinese have a word for Oxford and a word for Cambridge. There are things we need to do there, but—it is an important “but”—our approach to funding the second bucket of the missions work and indeed the company must also look outside, and we must be realistic about where you are going to get it. You are not going to get high-tech manufacturing necessarily in and around the areas where you get the start-ups. They often go to different places. We have to make sure that we get that right as part of this.

Building on that, one of the things that has happened as well in that curiosity-led bucket is that there has been investment over time in some of that excellence. In the research excellence framework that thinks about the quality of the research, it is striking that in the most recent one that is more spread around the country than the previous one, because there has been some long-term investment in capability and excellence, so that the excellent research is being rewarded more around the country. It is not the same and it will still be clustered. On some of the specific work that we have been doing in areas, some of the work on things like innovation accelerators has very much tried to address the points on both applied government and thinking about company scale-ups. If you look at the West Midlands Innovation Accelerator, they have tried to work much more in partnership with the place, to say, “What do the companies need? How do we bring the scientists?” Hospitals are working directly with scientists to make sure that the products are usable and can get to market faster. There are some quite interesting innovations in how we are trying to spend that money and how you can make sure it pulls through, and it is very place-specific when thinking about capitalising on that. We have extended for this part of the SR, and we will want to look at the results of that for the next one.

I have one other point coming back specifically to Exeter. The public sector research establishments have long been, in my view, a rather underestimated part of our system. The excellence of what goes on there and the potential for spin-outs and other companies and growth from that is something that I am very interested in trying to push. Where we have the PSREs, they are often places that work well with local businesses; they understand the local community, they employ a lot of people, and they train a lot of people. That is a really good starting point, together with the universities, to think about what we can do to stimulate the growth that comes from that.

Specifically on the Ox-Cam growth corridor and your role now in being the champion for that, I would like to understand a little bit more about your vision for it. Do you see it as an Oxford and Cambridge or as an Oxford to Cambridge? What is the role for the towns and cities in between? Are they just to be dormitory, nice places for scientists to live, or are they actually part of the growth potential of the region?

It is definitely Oxford to Cambridge. It is the corridor as a growth area. We have in the middle of that Cranfield University, which is a very interesting applied university. We have Milton Keynes, of course, and a number of places where we can already see companies that no longer need to be right up close to Oxford or Cambridge moving out there and creating high-quality jobs. I visited some recently where an estate of new high-tech companies is growing up along that corridor, beginning to create the high-paid jobs of the future. This needs to be not primarily about what we can do for Oxford and Cambridge. What can we do as a result of that expansion and the opportunities that lie right the way across, creating new jobs, better-paid jobs, better opportunities for people and better opportunities for their children, and indeed that will also be a growth engine for the country as a whole? That is what we need to be aiming for. Of course, it helps that once you have that joined up properly, it makes the whole thing easily navigable. You end up with a cluster that is similar to what you see in some of the places in the States, where if your company goes under—let’s be realistic; many of these companies do go under because that is the nature of innovation—you do not suddenly have to move; you can stay there with your family and go to the next job. There is a very big opportunity about wealth creation and opportunity creation right the way across that corridor.

On the Oxford-Cambridge arc, you are the champion of that while also being the science Minister for the whole country. Should there be a ministerial champion for the Liverpool-Manchester-Leeds corridor and the Plymouth-Exeter-Bristol arc? It feels like we might be in danger of gilding a lily that, as you acknowledge, is already well known and is already crowding in private sector investment, whereas there is a huge amount of potential in other areas of the country that we are not necessarily pushing forward.

As I said, I met with strategic mayoral authorities. We are in regular dialogue about what we can do in other places. I am meeting a group from Liverpool, I think, this afternoon or tomorrow afternoon. Clearly, my job is to make sure that we get it right across the whole country, and, as I said, those things are not in opposition. I am going to be very focused on making sure the Oxford-Cambridge growth corridor works. I am also going to be, in my job, making sure that the country as a whole does well out of this.

Great, thank you. Just a final question from me on regional inequalities in funding. When we look at venture capital and private equity, in the south-west we get about 2.7% of all that private funding. Dame Angela at a recent Committee hearing said that she had joked to a few people that universities should buy some helicopters and ferry them in and out of London to get them to areas outside London quicker because they are based in London and they want to get to the businesses that they want to invest in and back from them within a day. What is your view on getting private sector capital into start-ups and scale-ups outside London and the south-east?

Do you advise buying a helicopter?

A hydrogen helicopter.

Chair, you can answer that question for me, I am sure. No. There is an interesting reality about venture capital, which is that it is both global and local. They can invest anywhere, but when they invest they want to be able to visit their companies and see what is going on. I worked with the Manchester groups before I took up this role, and one of the points that I pushed with them was that you need to get the venture capitalists not only to come and visit but to start getting bases there. They will get bases there when they see opportunities there. There are two stages. We have to get the venture people out and around. You are right that there is a danger that international VCs simply go to the places they have heard of. Part of our job is to make sure they visit the places they haven’t heard of as well. We are seeing an influx of venture firms. We have more US companies wanting to come and have a base here, and we have more of our own companies wanting to think about what they are missing out in different places in the UK. Ultimately, a success is when we have venture firms based in other places in the UK as well, and not just in London.

London gets about £1,350 per head spending on transport infrastructure. The south-west gets a quarter of that. To what extent is your role also to talk to other Departments to make sure that the infrastructure is there to get opportunities off the ground in other places outside the greater south-east?

It is clearly part of what the Oxford-Cambridge growth corridor is trying to do. One of the things that I want to do as part of that role is to show how joined-up Government can work. The point you raise is right. You have to make sure all the bits come together, and very often it is fragmented. We are trying to run it as a project of integration, which, if we are successful, will not be the last time we do that integrated work.

On that point, I looked forward as a trade envoy to helping support the global messaging about our clusters. I want to make an observation and ask a question. We set up a regional cluster digital mapping tool, and I was trying to help tell a global story about how fast they are growing. We used the wrong technology. We used a bit of web-scraping, and it didn’t really map the clusters very well. Is there any work ongoing to support us in being able to tell a story globally about, for example, Glasgow, where there is amazing change, or Dundee and Aberdeen? Is there some tool being developed still, or is that now parked?

I have certainly seen things on it. You can talk about the tool, Alex.

We have been looking at that tool, the updates we can make to it, what it is being used for and what is most useful. It is an ongoing conversation. People like the tool. It has been used. There is more it can do. As you say, the technology develops and the information develops. One of the challenges, as you know very well and you challenged us with, is capturing live data about these places that really gives you a sense of what they are.

Can I put in a plea for co-creation? I think each cluster would love to fill in their own and say, “No, you’ve misunderstood the Cheltenham-Gloucester cyber corridor.” If we co-create, it could be very powerful. I want to ask about infrastructure in the context of the regional and national mission. We know that public sector infrastructure is key. Patrick, you have been a great champion of Daresbury, the synchrotron, that big, deep infrastructure that only the state can fund. Then we need to attract in and crowd in the private. I notice over 30 years in this sector how much the infrastructure has changed. When I was funding companies, all they needed was a 2.4-metre fume hood and some air handling. Now they need really complex digital and access to Biobank. Science parks need much more complicated data. If we are going to scale up, we need to scale up beyond the south-east as well. I have two questions. One is about how we get the public/private right. This has not been a great area for Government over the years. When I came back into Government, I inherited VMIC. We tried to turn a vaccine manufacturing innovation hub into a pandemic factory with different skills. The cell and gene therapy hubs are struggling, I understand, to get private sector in. CPI is a brilliant place, but we get criticisms that the catapult hubs are crowding out the private sector. It is a strategic problem for the UK and an opportunity. What lessons do you think we should learn about how we get that private/public infrastructure right? Then there are a couple of specifics that I will come to.

It is a great question and I wish I had an easy answer to it, but I don’t. It is crucial that we look at the infrastructure and we specifically concentrate on the big bits of infrastructure that cannot be done any other way than the state doing it. That is why the AI research resource is important. The Isambard-AI computer in Bristol is not the sort of thing that the private sector is going to do. The Dawn AI computer in Cambridge is not the sort of thing that the private sector is going to do. We need to get these right. Going back to the previous question, if you take AI as the example, the fact that there is going to be an AI energy council asking, “How do we get the power supply to these things?” tells you that it needs to be joined up as we look at it. We need to look at the infrastructure we have and make sure that it is the one we want for today and tomorrow, not just the one that we had yesterday. That is part of the challenge of how you transition from the past to the future. I don’t think we are going to get private sector into those big infrastructures. We have to fund them from the state to start off with. If you look at what happens to them, the private sector starts to use them more and becomes a revenue source for some of them as well, which shows you that you have made the right decisions, but it is not an easy one.

Thank you. Back in the coalition, when there were some pharma closures, and you were in the industry, we successfully set up the life sciences opportunity zones like Alderley Park and Sandwich. We struggled with Charnwood. A lot of the old pharma sites, it seemed to me, could be turned into incubators quite successfully. There is some good history on that. Is any work going on, particularly in the life sciences but in other areas as well, looking at mapping infrastructure around the country that could be national assets that we could private-public regenerate?

Yes. The AI growth zones are exactly what that is about. Those zones are likely to end up in places that have existing big power supply—industrial sites that no longer have the requirement. That is something that is happening. On life sciences, yes, it is very much part of how we are thinking about clusters and growth and where there are opportunities. As you say, the move of AstraZeneca from its major site in Macclesfield to Cambridge, which could have been an absolute disaster for that area, has led to rejuvenated science activity and manufacturing activity there, and that is how we need to think about these sites.

I have three specific little questions. One is on Biobank, which I know you have been a great champion of. I saw some data the other day on patents out of Biobank that have been commercially exploited, and they were nearly all in America. There were very few in the UK. I wonder whether we are using that infrastructure enough. Secondly, there is a debate running, as you know, about the Harrow level 4 containment facility. Having done VMIC, I want to get your take on whether you think that should be led by academia, industry or DSIT, and whether that is a public piece of infrastructure or a private sector one. I want to get your take on the lessons from the AstraZeneca saga in Speke. This speaks to whether the UK should and could be doing more to support strategic technology, particularly vaccines. We have Porton Down and the Jenner. Are there some lessons from the pandemic about how we could deploy better to anchor companies like AstraZeneca?

I will have a go at those, and I may bring Alex in as well. I was just thinking as you were asking the question how annoying it is to have an ex-science Minister on the Committee. Yes, Biobank is a huge international resource. It has been a massive success story. It is fuelling inventions and discoveries right the way across the globe and attracting companies to the UK. People are coming because of it and wanting to work with it. It is definitely an inward investment success story. You are right; patents are emerging from some of the use of the data. Biobank was established as an open access resource, which I am sure was the right thing to do, otherwise it would not be where it is today, but it comes back to a topic that we touched on earlier, which was how we think about protecting the value of data and getting value back to the UK. It is a very critical point, which is going to be important for health data, for public sector data and for Biobank data. We need to be smarter about which business models allow us to give open access and value capture. I do not know exactly what the answer to that is, but it is something that is being looked at very hard now, and it is obviously something that is relevant to the formation of the national data library—how you do open access but ensure that you get value capture back. Regarding category 4 labs, I started a piece of work on this when I was Government chief scientific adviser because it worried me that we did not really know exactly what we wanted to have in terms of category 4 labs. There is a piece of work ongoing at the moment, and we will end up with a clear view as to what is required. It is important—maybe you were alluding to this in your question—not to create a facility that does not have a use. There are lots of ideas that people come up with about creating new facilities for X, Y and Z because they will be useful one day. If they are not useful every day, they do not work in an emergency. Having a mothballed thing or a skeleton does not work. The question for the category 4 labs is how many the country needs, to what extent they can be used for everyday purposes, and whether that is best done fully in the Government sphere or best done with academia plus private sector and others. That is being looked at at the moment, so I do not have a precise answer. On AZ and Speke, obviously it is disappointing that AZ did not continue with that deal. We are in discussions with AZ on all sorts of other things as well. It is a huge and important company in the UK. Vaccines are broadly in a better position now than they were before the pandemic. One of the things that worried me both immediately before the pandemic—literally immediately before—and when it hit was that we had lost our vaccine industry in the UK, not because of a strategic decision that we did not want it but by benign neglect, and we cannot afford to do that in these areas. What I am pleased about in the vaccine space now is that we have a £1 billion deal with Moderna with their new base opened in Harwell, which they constructed in record time, and is an important new vaccine facility in the UK, and the £1 billion deal with BioNTech, which is being laid in front of the House today, with up to £129 million in support from us for their cancer vaccines work in the UK. We have two really innovative companies here now. GSK has put £60 million into Oxford to do more work on vaccines. When you look across the country, we now know where the fill-and-finish capacity is for vaccines, with a potential scale of up to 2 billion doses per year. We are in a better position. That is not to be in any way complacent. I reiterate that it is very disappointing that the AZ Speke deal did not go ahead.

I am going to move us on now, because we are running out of time, as anticipated, to focus on life sciences. Martin, I think you have a couple of questions.

Sorry, can you give me a moment and move on to somebody else first, please, Chair?

Emily, you had a question.

Life sciences is one that you have direct in terms of the industrial strategy. It is also one of our important missions in improving health. I want to understand a little bit more about where you see some of the fantastic science work that we are doing, the links with the Biobank, and the opportunities for universal screening for genetic health in order to move us from the acute to the prevention to the early intervention, and how work is going on across Departments in that mission for a healthier population in the UK.

The Office for Life Sciences is a joint activity between the Department of Health and Social Care, DSIT and, increasingly, DBT. It is great that we have that single point of focus. The life sciences sector plan is being developed at the moment. The Secretary of State for Health and Social Care has been very clear that he wants an ambitious programme to meet his objectives of moving from sickness to prevention, from hospital to community and from analogue to digital. There will be a lot about data in that, and, of course, genomics is going to be an important part of it, for sure. The UK has done really well on genomics. The Biobank has been a huge success story on how you can use genomics to understand disease. We have the study of 100,000 genomes being done in newborns, which is going to be a revolution. It is obvious, but once you have done your genome you’ve got it. You do not need to repeat the test lots of times; you know what your genome is. Our Future Health, which is looking at this across 5 million people, is widely seen as a very attractive thing for companies to come and work with us, and will change how we think about using these things in the NHS. I was speaking to a company about polygenic risk scores. A decade ago, most people thought you cannot work out what your risk is with common genetic variation; each one is too small. Now people are able to do predictive work there, and that means that you will know whether you are at higher risk of high blood pressure, diabetes, breast cancer or whatever it is, not on the single gene mutations but on common genetic variation, and then know what you can do about it to reduce your risk. It truly is a revolution in how we are able to think about preventive healthcare. I for one will push very hard that we look for adoption of these techniques in the NHS early, because that is how we make a sustainable NHS. Innovation is the route to sustainability in the NHS, and that is what the OLS will be pushing.

I can see how excited you are by that. We are all quite excited. How long do you think it will be before this is a universally offered service to people on the NHS in the context of moving to prevention, moving to early intervention and understanding more about our individual risks of particular diseases or cancers?

I don’t know, because it is a difficult thing. It involves service reconfiguration as you think about these things. I visited the Royal Marsden Hospital on World Cancer Day and saw some of the things they are doing with AI for reading scans and doing pathology. We have some really good cutting-edge examples. We need to do that right the way across the NHS. The Secretary of State for Health and Social Care and the Secretary of State for SIT both believe that innovation is the route to sustainability. Therefore, we need to put more pressure on this innovation not just as a pilot but as a scale-up right the way across the system. You know and we all know it is difficult to get change in an organisation that is as big and complicated and important as the NHS, but it is essential to do this. I would love to say next Tuesday, but I can’t.

Thanks very much. Martin has some more questions.

Thank you very much. I am sorry I am slightly diverting. You talked about the Royal Marsden, where my sister is currently undergoing treatment. I love all the innovation and the fantastic things that we can do at the cutting edge. It frustrates me and patients tremendously that they do not have the basics to build on. I was waiting for my sister to come back from whatever scan. The nurse did not know where she was and could not find her because reception had gone home. The systems are not there to support the high-end innovation. I notice that you are not responsible for technology per se; you are science and innovation. How do you work with the NHS to make sure that there is a sufficiently sound basis of fundamental technologies—patient handling, information, getting rid of letters because Royal Mail no longer delivers them in time to get to your appointment? We are failing on basic technology while focusing on the lifesaving innovations, and you cannot deliver those lifesaving innovations unless you have a solid basis to work on.

First of all, let me wish your sister well. I hope she comes through with great success in that treatment. You are right that there are core data and infrastructure issues that need to be resolved. I alluded to that in terms of service configuration. One of the reasons that DSIT was established as a digital centre of government was to try to help everybody to get those things right. The Secretaries of State are working closely together on this. The Life Sciences Council also understands it and wants to push for those things. What frustrates everybody is that there are examples of great practice around. There are examples of AI being used to do exactly the sorts of things you are talking about—the management of hospitals themselves rather than new treatments. How do you use it to get rotas right? How do you use it to make sure that appointments are properly targeted so that you do not have missed appointments? There are examples where 70% of missed appointments are being reduced by going down that route. It is those simple things. I know from my own experience. I happen to have a general practice that is very good in terms of the NHS app and what I can do on it, and I know from somebody two streets away that they do not. We have to get these things implemented right the way across the board. This is very much outside my portfolio, but it is something that I care about. I spoke to the Secretary of State for Health and Social Care about it recently. I know that how you get these things right is exactly what DHSC is focusing on. It is about using technologies to improve the way the system runs, as well as using technologies to develop the interventions of the future. I agree with you. Again, I am sorry I cannot give you an answer: “Yes, don’t worry. That’s all going to be sorted out.”

I wasn’t expecting one. Can I draw your attention to the excellent work going on at the Exeter former Nightingale site where they have radically changed the way they treat patients? The ideas are largely driven through the Torbay trust. They have extracted to a non-emergency site huge numbers of low-risk, high-volume procedures and are reducing waiting lists considerably. They are showing them off at all sorts of innovation areas. It is important to remember that innovation is not always the latest whizzy, shiny thing. Innovation can be looking at a problem and tackling it in a radically different way, as they have done in the Exeter Nightingale, which is a beacon of hope for the NHS.

I will make sure that is drawn to the attention of DHSC. I am sure they know.

We are going to talk about UKRI and the research system more generally.

It is an old and vexed issue, Patrick, as you well know, about the landscape and the UKRI debate and how it adds value to the research councils. We commissioned, as you know, two or three years ago a major review of UKRI by David Grant. It was excellent, very thorough and detailed, and highlighted quite a lot of systemic and structural issues. As you appoint the new CEO, I want to ask for an update on the implementation of the Grant review and how that is going. As per your earlier question, of the £20 billion a year, you said at the Lords Committee recently that you were not yet sure how much should go to blue sky. I know it is not quite as clear as that, but how much of that £20 billion of public money do you think should be going to blue sky, how much to industrial, and how much to the other priorities?

There are three major reviews of the research landscape—Tickell, Grant and Nurse—all of which have been looked at by the Department and are being implemented. UKRI is a long way down the line of implementing all the recommendations of the Grant review. Alex may want to say more about that. I said when I came in that it is important that we make sure that we get the most critical parts of these reviews implemented rather than trying to do everything on all of them all at once, and I think that is what is going on. I am absolutely sure that the new CEO will have views on how best we can do the other parts as well. The aim should be to give more time for researchers to do research in that setting, particularly in the curiosity-driven research area. Do you want to add anything, Alex? Then I will come on to the other points.

David Grant was invited back to the UKRI board to assess progress against his review, and he gave them a reasonably positive assessment. He said there was more to do on the digital join-up, which is still the case. Broadly, he was complimentary on some of the things they had done to try to fix the issues he talked about. There is definitely still more to do, but they felt it was important to get him back to give him the assessment of how things had gone, and he was, as I say, broadly positive. Data systems working together and improving the integration of that were the key things he highlighted, and UKRI is looking at some of that now.

On your question about the exact amount for curiosity versus the other two buckets that I described, we are going to look at that as part of SR2 to make sure we get it right. One has to be realistic; it is not going to be very different from whatever happens now, because you cannot change that overnight and suddenly say you want to put 50% more in one place or another. I am very determined that we have a much clearer way of understanding how we are protecting that and how we are getting true growth from the other things we do. We need to make sure that the other bits really are focused on Government objectives, and deliver growth, deliver benefit for individuals and deliver the things that Government need to be more effective, and we will have much harder objectives around that.

Thank you. SR2 timing?

It is coming up for the summer.

In your answer there, Patrick, I was concerned to hear you say that curiosity-driven research happens where it happens, and where it happens is where it is going to happen. There are real links between curiosity-driven research, innovation, company start-ups and growth, and some of those links are dependent on geographical proximity. As we know, the people who decide where research funding goes tend to be people who are funded by research. How do we make sure that curiosity-driven research is not simply the same old boys funding the same old boys?

Sorry, I want to be clear about that. I am not suggesting that you do not get good curiosity-driven research in all sorts of places. You should. Frankly, one of the great strengths of our university system is that you get taught by people who do research. That is not true in many places. That is important. Absolutely, you get curiosity-driven research everywhere. It is also the case that we have some real concentrations of places where you cannot do the types of research that go on everywhere. Some need to happen in certain places with facilities and critical mass. What goes on in Newcastle University is going to be different from what might go on in a much smaller university somewhere that cannot have the same sort of infrastructure. It is not the case that we are going to have it spread equally. We have to be very careful not to look at this type of research and say it should be equally everywhere in the country. There are going to be hotspots where it happens all over the country, and then we must make sure that the lone investigator who has some brilliant idea somewhere can also get access to it. One of the reasons I am being rather firm about these three buckets is that I want UKRI to tell us more clearly how it is going to do this in those three buckets. How is it going to make sure that curiosity-driven research is the thing that the country needs for the future? It is not an area where Ministers should tell them what to do. You should not have Ministers saying, “I want you to do curiosity-driven research in areas X, Y and Z.” It needs to be driven by the brain power and excitement that comes from the bottom up. You can do that in buckets 2 and 3.

We also need to make sure that the brain power making the decisions is better representative of the brain power. We only have 15 minutes left.

I have a really quick question. The Labour manifesto committed to a 10-year R&D settlement. Are we expecting the spending review to set out that 10-year settlement? What do you see as the benefits of a 10-year settlement for this area?

We have done extensive consultation on which areas would most benefit from 10-year funding. It is not every area. One of the problems that UKRI has had is that too much of its money is tied up and it cannot change, and too much of its money is done in yearly cycles, so you end up getting money out of the door at the end of the year. There are two things that I want to happen for SR2. I want roll-over provision—in other words, some degree of roll-over between years in order to manage the spend better. We developed a series of criteria for 10-year funding on the things that make a big difference, and those will be the areas that we will then put forward for 10-year funding.

I want to pull on a few of the threads of things that we have discussed. Going back to the CEO change at UKRI, Dame Ottoline’s tenure is due to end, I believe, this June. Have you yet made a decision about who her successor will be? As you move from her tenure to the next, what do you want to see continue and what would you like to see change?

We are very close to making an appointment, and that will be announced shortly. I have outlined how I would like to see much more clarity on the different areas that UKRI does. I would also like to make sure that we view UKRI not as a bureaucracy above the research councils, but actually as a way of looking at the diversity of the funding scheme we need to be appropriate for the needs of the country. That means that not everything needs to look the same underneath it and the research councils are important, but there could be other ways of doing things. A number of different funding schemes have been set up over the years. Ideally, those would go under UKRI. UKRI would not be a monolithic thing; it would be a thing that tolerated differences. I know a lot of work has been done along this line, and Ottoline has done a great job of trying to move in that direction, but we need to move in that direction. We need much greater clarity on return on investment from UKRI. We need Innovate UK to be really focused on the growth mission and how we get that right across the country. Picking up the Chair’s point, we need to make sure that diversity is there. Diversity and inclusion is not a nice to have; it is an essential if you are to do great research. You cannot solve big problems with monolithic thinking. I am looking for the new CEO to really think about how they drive UKRI to a lighter-touch strategic body, more diversity of ways of funding underneath, more flexibility to be able to go into new things where you need to, and the protection of the thing that is the goose that lays the golden egg, which is all the ideas at the bottom that today nobody really knows about but are going to be the thing that is the quantum computer of the future, the messenger RNA vaccine of the future or the things that we just cannot see at the moment.

Brilliant, thank you. I have a couple of questions now about ARIA, picking up on that again. In May 2023, your opinion at the time was to leave ARIA alone and let them get on with it. Now that you are the Minister in charge of ARIA, do you still take that view?

Yes.

Fair enough. In that case, how do we judge ARIA’s success and its value for money?

One of the lessons from the initial ARPA organisations and the people who founded those back in the ’50s and ’60s in the US was that the best way to kill them is to keep them on too short a leash, and that is what has happened. We are right to make ARIA independent. They have their first programmes in play now, which look exciting. They have different programme directors from the normal run-of-the-mill. It goes back to the Chair’s point about diversity. They are selecting people quite differently from how universities and others might select them. They have a great new scheme, the activation partners scheme, which is about attracting people who could take the things that come out of ARIA and turn them into products. They have nine different companies, including two top US venture capital firms, that have based themselves in the UK specifically to pick up on these things. We are beginning to see success in inward investment, interest and attraction of talent. I have no idea which of their programmes is going to succeed.

That is fascinating. The second cohort of programme directors, I understand, are more from industrial backgrounds generally, with more industrial experience. Touching on the point we made a few minutes ago about blue skies, do you think that it is going to have an impact on the amount of blue sky research, given that we have these industry-focused people? Are there positive and negative aspects of that?

The first round of programme directors was mainly academics, with two people with industry experience. This time round, they have more people from ARPA organisations who have applied. They are getting people from the US wanting to come and work there. At the end of the day, it is not pure blue skies research in ARIA; it is trying to tackle a problem that is potentially tractable but really difficult. Some skills to bring along how you marshal multiple groups to try to tackle a problem are needed, and some of those skills sit in the industrial space. Some of the academics have learned a lot of those skills in the first place. They are pretty mixed in terms of academics and industrial people.

How do you think it all builds into the Government’s growth mission?

ARIA is a long-term play; it is not going to do something in the next couple of years. You can already see through the activation partners that inward investment is occurring. We have interest. Rather quickly, we are seeing some change even though the programmes themselves may not play out for a longer time period. It is an exciting different way of doing work. We are getting a lot of interest from people overseas on it, and, as I say, a lot of talented people are coming to the UK. What is interesting about it is that people who are in the specific fields sometimes say, “Well, they don’t know what they’re doing. It’s all a bit naive.” People outside the specific fields say, “It’s really exciting what’s going on in that field over there. It looks like something new.” We will see how it plays out. It is definitely disruptive and doing things in a different way.

Great. One more thing from me before I hand back to the Chair. You told the Lords Science and Technology Committee recently that you were in discussion with the Home Office about visas and attracting talent to the UK. Has there been any progress on the visa front?

The Chancellor mentioned two weeks ago in her speech that she wanted to see visas for science and engineering. The Migration Advisory Committee is due to read out in summer this year and there is the Home Office White Paper. There are lots of things happening. It is worth saying that the number of people who applied for the global talent visa increased 10% from 7,000 or so to 8,000 over the last year. There is some movement, and it is being looked at very carefully.

A final question from me. Is there a risk, given the focus on global talent and global talent visas, that that focus comes at the expense of developing home-grown talent?

I do not think so. This country has always relied on both home-grown talent and international movement. We have done really well out of both of those, and that is what we should continue. We need international science talent to come to this country.

Brilliant. Thank you, Patrick.

We only have a few minutes left, but we have four important subjects. Does the Minister have a hard stop at 11.30?

I can go on a little bit, but not a long time.

Fantastic. With an extra few minutes, we will be able to have two minutes on each of these four important subjects: diversity, the Regulatory Innovation Office, R&D tax credits and VAT, and space. Are there enough women in different Departments in science-related roles? There was an ambition by the previous Government to dramatically increase the recruitment of STEM in the fast track for the civil service, which I think has been achieved. What is your role or responsibility when it comes to driving diversity, not only on gender but on class, ethnicity and disability, in the public sector and in the private sector in the STEM workforce?

I was very focused on this in my previous role. I was the one who pointed out that 10% of the fast stream had a STEM degree, and that is just not acceptable, and I got the target to 50%, which has now been met, and diversity is crucial in that. I am very personally interested in this area. The question of what happens inside the civil service is more for the GCSA than for me as science Minister, but I am interested in it. I will keep an eye on it. It is quite difficult to get all the data, but there is quite a good balance at senior civil service level now of science in terms of gender balance. We are okay on other aspects of diversity, but, frankly, there is work to be done. In terms of ethnic minorities, it could be 25%. Some of it is unclassified. The data is not really great.

What is unclassified?

It is when somebody has not declared. We have about 11% who are undeclared. It is 75% white, 5% Asian, 2% black and 1.8% mixed. On gender, at the senior civil service level of science and tech, it is 46% women and 53% men.

That is much better than the industry equivalent.

Certainly, at senior level, it is much better.

At senior level, yes.

In terms of declared disability, it is 10.5% in the science and engineering roles. There is definitely work to do on that. We need to monitor what is happening with the new fast stream as well and see if we are getting the right balance.

I agree with you that there is work to do, as there is in the private sector as well. I am hearing that you do not always have the right data or the right access to data. Perhaps you could write to us and set out how you are going to improve data so that it can be scrutinised by our Committee. What do you see as your role in the private sector in terms of driving diversity?

I will say a word about the data. The problem that we have with data is definitions of science and engineering roles. It is not the ethnicity data. There is good data across the civil service on that. It is the problem of identifying exactly who is in a science and engineering role. We will ask the civil service to try to come up with some way of looking at that. Clearly, the private sector will do what the private sector does. It is definitely my role to make sure that I keep championing the point that you cannot be a solver of problems if you do not have diversity. All the other reasons to do it are crucial, but there is a simple business reason to do it as well, which is that you are much better at decision making, you have much more effective teams, and you have a much better workplace. I will continue to champion that and make that point, as I do almost every time I speak.

As well as racial and gender diversity, can I suggest that private sector career diversity is key as well in harnessing science for economic impact? In the data you might be able to come back to us with, I do not know if there is any data on how many DSIT staff have private sector and industry experience. Perhaps offline, we could follow that up.

That very much sits with the civil service and with the GCSA. We have data. We have the Expert Exchange programme, which is a secondment programme for bringing people in and out. We have a number of secondees in. I will come back to you on what we do.

Come back to us on that. While the private sector will do what the private sector will do, we provide funding for the private sector and the Government Department has an impact in helping to shape what the private sector will do as well, which we look forward to monitoring.

We have historically been extremely good at discovery and not as good at development and implementation. I have outlined ways in which I want UKRI to reform to do that. It is important that we do that because the translation of the science into things that are valuable for society, and economically valuable, is an important way in which we continue to fund science, among other things, and it brings direct benefit to citizens. I am concerned in the sense that my job is exactly to try to get that right. We remain among the leading science nations in the world by any metric, and we should not forget that. We should not forget that if you lose that it is unbelievably difficult to get back again.

Excellent. That is a fantastic point. We have three questions and 1.5 minutes each. We have the Regulatory Innovation Office from Steve.

Thank you. In terms of the RIO and how it has been set up, what are the regulatory barriers that we hope it is going to overcome? What role does it play in the development of the industrial strategy?

We have set it up focused on new technologies. What barriers is it trying to overcome? The fact that lots of new companies have to go to seven, eight, nine or 10 different regulators, that regulators are not joined up on some of the new things, that regulators might not have the expertise, that the regulation may not be suitable, and therefore you need sandboxes to do it. We have some examples already in the four areas that we have chosen to start with in the Regulatory Innovation Office. We are working closely with the MHRA on AI in healthcare. We have been working with the CAA on issues of drones and autonomy and how you can free that for them to be able to go across longer distances outside line of sight. We have been working with the Food Standards Agency on a sandbox for cultured meat.

How do you pick what goes in? What is the process? Is it picking winners, or do companies and sectors come to you?

We picked four areas to start off with that we thought were the biggest potential growth areas. I was very keen that the office did not try to do everything, otherwise it would go very slowly. I want to see success in four areas, and then we will expand across other areas, which will be based on perceived company need—what we are hearing—and where we think there is growth potential from new technologies.

Thank you. That is very helpful. R&D tax credits and VAT: first, there is a, hopefully, simple question on the zero rate of VAT currently enjoyed by medical and veterinary science. Are you looking at it? I know it is a spending review question, but is there a discussion about extending it to other research disciplines?

No.

Thank you. An excellent quick answer. R&D tax credits are about £7 billion, which is, effectively, a third of the science spend, although it is not accounted for in the £20.4 billion science spend. Do you think it is successful in driving private sector innovation? Are you looking at discussions on reform of the system to better support R&D while preventing fraud?

A lot of work has been going on in that, as you know, with worries about people claiming inappropriately, and the Treasury has been looking at it very hard to make sure that we get it right. R&D tax credits have been an important part of the system. They are particularly important for some sectors that find them more valuable than others. We have a very competitive R&D tax credit rate. That is part of why we can attract companies here and why we keep them. As I said, we now have to make sure that that translates into sustainable growth of companies, which may need different things to be thought about as well.

Is that something that R&D tax credits should be doing, or is it something that your Department is looking at?

Other areas?

Yes.

I am specifically looking at what needs to be done to allow companies to scale and grow, and doing it in combination with DBT and Treasury.

Finally, and we only have a minute left for this important area, space.

Patrick, I know that you understand that the space sector is one of the sectors that is key to so many of the other priorities. It is key for blue sky science, a great experimental testbed for health, quantum effect, research on the moon, driving the regeneration of Glasgow, and pulling through strategic sat comms. It is a key sector. Where do you see it sitting in the S&T framework and the industrial strategy? OneWeb has now been sold. We still have a golden share. Do we have ambitions for our space sector, or should it conclude that the action is elsewhere around the world?

No, we have ambition. It is under Minister Bryant’s portfolio. I am there to make sure the R&D bit can get supported. It is an important area for the UK, as you say, in terms of both what we do with it—things like Earth observation and other areas, and indeed the potential for a launch—and SaxaVord and the £20 million investment announced last week to try to get advance of a project from Orbex. There are definitely things that are seen as important. As you know very well, the possibility of getting a launch into polar orbit is rather important.

Great. Thank you, Patrick and Alex. You have spent a considerable amount of time with us. We have covered a lot of different areas. It is testimony to the interest of the Committee in the work that you are doing, not surprisingly. Thank you for the way you have responded to our questions and for the time that you spent with us. I am sure we will follow your work with interest, as you can no doubt imagine. There are a couple of letters that we will be writing to you coming out of this, but for the moment thank you so much for the time you have both spent with us. We look forward to working with you in the future.

Thank you, and likewise. I hope that some of the things I have talked about will give greater transparency on where money goes and what the effect of that money is, which is the important thing.

And the impact it is having on all our constituents’ lives.

Exactly.

Thank you very much. [1] Clarification by witness: “It is worth saying that, of the Department budget, £13.9 billion.'