My Lords, I support Amendments 482C, 490A, 495C and 495D, to which I have added my name, and support what has been said by my noble friends Lady Brown of Cambridge and Lord Broers.
The noble Lord, Lord Liddle, referred earlier to the industrial strategy. This is highly relevant to the Bill and to Innovate UK. The industrial strategy has 10 pillars. The first is:
“Investing in science, research and innovation”.
The Green Paper clearly acknowledges the serious problem we have in the UK with commercialising our outstanding science. It states that,
“historically, we have not been as successful at commercialisation and development as we have been at basic research … We have already taken action to address the UK’s … relative weakness in commercialisation, through the establishment of new, more industrially focused institutions such as Innovate UK”.
This group of amendments addresses the freedom of Innovate UK within UKRI to operate successfully and with full autonomy—otherwise there is a danger that it will not be as effective as it should be. I fully support the point made by my noble friend Lady Brown of Cambridge. Paragraph 16(1) of Schedule 9 states:
“UKRI may do anything which appears to it to be necessary or expedient for the purpose of, or in connection with, the exercise of its functions”.
However, paragraph 16(3) states that UKRI may not,
“form, participate in forming or invest in a company, partnership or other similar form of organisation”,
except,
“with the consent of the Secretary of State”.
That seems unnecessarily restrictive on Innovate UK. It should not have to obtain the consent of the Secretary of State whenever it wishes to make an investment in a company, partnership or similar organisation. A very similar point was made earlier by my noble friend Lord Oxburgh in relation to forming joint ventures. Innovate UK should have the freedom and flexibility to invest as necessary to promote research and innovation to the greatest economic benefit of the UK—although, clearly, financial limits should be set periodically by the Secretary of State. That is the purpose of our Amendment 482C.
The world is changing very rapidly and it is therefore vital for the economy to have a high level of UK R&D investment in science and engineering. The UK must continue to be world leading in innovation. We cannot
afford to slip behind, and UKRI must be made to work really effectively. Innovate UK, with its strong business-facing focus, along with the science and engineering community, must therefore be allowed to continue to play a key role in promoting research and innovation. Innovation is an inherently risky process with an uncertain outcome. To be really effective, Innovate UK must be allowed to promote high-risk and disruptive innovation.
This House’s Committee on Science and Technology, chaired by the noble Earl, Lord Selborne, and of which I am a member, heard in evidence that many businesses have concerns about the status of Innovate UK in the proposed UKRI, especially in relation to risk and the backing of new companies. Innovate UK must therefore be allowed to invest in commercial arrangements, including companies or partnerships, if it is to be fully effective in promoting innovation and commercialising research—and this should be in the Bill.
Innovate UK operates in a quite different way from a research council, so I urge the Minister to reflect on and give careful consideration to this matter, and to ensure that the proposed structure of UKRI is not unnecessarily restrictive on the crucial activities of Innovate UK.