AIRTO recognises that creating a favourable environment for science and innovation in the UK, is key to driving future economic growth.

Scientific research is important and the UK is good at it. So too is innovation and the creation of new and competitive products and service businesses; and although the UK can point to some great the achievements in this area it has historically under-supported the essential infrastructure for this type of activity in both the public and private sectors. The Government’s recognition of the need to increase its support for the innovation process and the UK’s capacity for translational work is very welcome.

There are many steps in the translation of innovative ideas into the successful adoption of new products, new services and new business practices. It is therefore appropriate that the Government’s new science and innovation strategy highlights the role to be played by Innovate UK and the public sector supported research and innovation organisations beyond the university sector. Together with a significant number of private sector bodies these comprise the Innovation, Research and Technology (IRT) Sector, which encompasses the newly created Catapult Centres and many other organisations (including AIRTO’s members).

An independent study commissioned by AIRTO shows that the IRT sector continues to punch well above its weight in the national economy. Carried out by Oxford Economics, the study reveals the sector has more than tripled in size since 2006, with turnover up from £1.9Bn to £6.9Bn over that period – despite the recession.

Taking into account the sector’s induced and catalytic effects on the economy, the total impact is assessed at between £32Bn and £36Bn, equal to 2.3-2.6% of total UK GVA, achieved with government support amounting to just 0.3% of its spending. This unusually high impact ratio emphasises the sector’s unique position in the national economy and underlines the importance of continued government support for translational research and innovation. AIRTO believes that this wider innovation ecosystem could usefully be afforded a higher profile in the Government’s strategy document as a very significant asset within the UK’s innovation ecosystem.

Over 80% of the turnover generated in the IRT sector originates from AIRTO members, who represent a network of organisations that is both significantly larger and responsible for a wider spread of activities than the equivalent Fraunhofer Institutes in Germany. Furthermore, the work of AIRTO’s members in interfacing with many of the research intensive universities is frequently pivotal in bringing vital translational R&D capabilities and expertise to bear on bridging research outcomes and inventions to eventual commercial and market uptake.

AIRTO members also provide a broad geographical reach, members of the network employing people in each of the UK’s twelve regions and devolved administrations, with more than half of all its employees located outside London and the South East.

The Oxford Economics report also shows that the sector has grown substantially since the last impact report was carried out in 2006. Over 57,000 employees now work in the IRT sector, a figure which matches the total academic staff of the Russell Group universities. The GVA per employee, commonly referred to as productivity, is 50% higher in the IRT sector than the national average and has risen 3% over the period since the previous survey in 2006, against a backdrop of stagnation across the economy as a whole over the same period.

Commenting on the launch of strategy, AIRTO’s President, Professor Richard Brook, said:

“AIRTO welcomes recognition that investment in the UK’s innovation and translational research infrastructure (including the new Catapult Centres) is essential to ensure that the UK derives maximum benefit from its excellent academic science and research and from business led ideas for innovation. Achieving a good balance between the UK’s investment in fundamental and early stage scientific research and in its capability and capacity for translation of innovative ideas to commercial and operational products and services is essential for Britain to be able to compete successfully at innovation and in maintaining a world-class skills base. It is essential therefore that all stages of the innovation process are supported in an appropriate manner and that such support is sustained. Such support should not be piecemeal but should ensure that a holistic approach is taken to all stages and aspects of the innovation process. The allocation of sufficient resource to the science base and to innovation and translational activity in the next Spending Review will be critical to success”.

What more is needed?

Government should continue to support and enhance mechanisms that will foster further links between academia and the innovation, research and technology sector. This should include provision both for developing the Catapult network and for enhancing in an appropriate manner the capacity of other Research and Technology Organisations and Public Sector Research Establishments. This network of organisations comprises a significant but frequently underutilised asset for the government in the UK’s innovation ecosystem. It is clear that further modest investment will have a major positive impact on the UK’s GVA.

For further information on AIRTO please contact:

Dr. Jane Gate, Director of Operations, AIRTO
Telephone: +44 (0) 20 8943 6354
Email: jane.gate@airto.co.uk