Technology foresight : first report. Volume II, Minutes of evidence and appendices / Science and Technology Committee.

  • Great Britain. Parliament. House of Commons. Select Committee on Science and Technology
Date:
1995
Catalogue details

Licence: Open Government Licence

Credit: Technology foresight : first report. Volume II, Minutes of evidence and appendices / Science and Technology Committee. Source: Wellcome Collection.

    35/204 (page 25)
    24 October 1995] [Continued {Chairman Cont] 6. If I were to ask who is now the Minister for Science, what would your answer be? (Mr Lang) In Cabinet context, I am; in the day-to-day Government context, Ian Taylor is. Chairman: Right. Dr Bray. Dr Bray 7. Against the general background of industrial policy, the Government has some reason for being pleased with itself on the record of inward investment. Would you feel that that has been as successful in the research and development of foreign companies as in production activities in the UK? (Mr Lang) Yes, I do, Mr Chairman. I think that one of the reasons that inward investment has been attracted to this country is the strength of our science base. I have more experience in the Scottish context of this, where I was able to use as a selling point to many of the electronics companies that we sought to attract to Scotland the access to the universities, the science parks and the academic institutions; with that there came the encouragement to locate R&D facilities in their investments and not just assembly shops. The calculation, when I left the Scottish Office, was that something like half the inward investment in Scotland had some R&D component with it; now the quality and strength of that R&D component would vary, but it is a trend that we were encouraging and which I continue to encourage at DTI, because, quite clearly, inward investment takes root more deeply and in the longer term if it has strong links to the science base in the country where it is located. I think Ian Taylor may like to enlarge on that. 8. Thinking of precisely those companies which you and I both know well, one feature of their research and development in the UK is that it is very much thinner than their corporate average intensity of research and development, in other words, their base lies heavily overseas, and this shows up when it comes to resiting production? (Mr Lang) It is, of course, only natural that a company that is building plants in other parts of the world to serve the market and manufacturing and selling products that have originally been developed in the home base, should start from a standpoint of having all its R&D at home; the important thing is that the R&D is attracted into the new location and takes root there and sometimes spins off other new developments, which can indeed inform future development back at the base of the parent company. It is that taking root of the R&D in this country that we regard as important, and it is increasingly happening. 9. If you compare pharmaceuticals, electronics and engineering, the foreign interest in research and development is heaviest in pharmaceuticals, less in electronics and least in engineering, and the foreign investment has been greatest in engineering, considerable in electronics and not very big in pharmaceuticals, apart from research and development. Do you think that that has any lessons for the overall balance of Government industrial and research policy? (Mr Lang) I am sure there are lessons to be learned from it; I hope we are learning them. But I think one of the reasons is that the pharmaceuticals industry for example, is one in which we are very strong ourselves and on which our own scientific base is very strong, and therefore that may make it less likely that we will attract science-orientated pharmaceutical development from other countries. 10. Looking at the particular practice, is it not the case that the pharmaceutical industry is supported not only by the strong science base but also by the procurement practices on drug pricing by the National Health Service? (Mr Lang) That may be so, but it is not within my remit so I do not feel I can answer authoritatively. 1 Chairman 11. Could I bring in Mr Taylor, because I think you had something to offer? (Mr Taylor) 1 do not want to interrupt the flow, but I just wanted to add one very interesting point. If you look at the Siemens investment, for example, in Tyne & Wear, over the last few months, one of the points they made to me was the accessibility of our research. We often praise the German research system—I have been to talk to them in Bonn, and I am not being critical about it, as such—I think the accessibility of our universities and their research excellence is actually rather attractive for companies coming in from Germany. Certainly in the semi-conductor business, we have got the chance of having very interesting relationships between the universities and the new industry that is now seeming to want to place itself in the UK. You mentioned electronics, and there is no doubt that the electronics industry—Sharp, Sony, Hewlett Packard, Motorola— have all done a very considerable amount of their research in the UK, which has then led to very considerable exports; I think Motorola is one of our largest exporters. Dr Bray 12. Have you looked at the Sharp labs in Tokyo and compared them with that in Oxford? (Mr Taylor) 1 agree with the President, in the sense that as it is a Japanese company, you would expect them to be rather well equipped and developed there; but I think the point is that we are looking to bring intellectual know-how and research and development in with the investment, and even a company which is less down the hi-tech field, Samsung, has actually followed its massive inward investment with an R&D base in the UK. So that is a welcome development, because, wearing my hat as Technology Minister, I am well aware that if you get the R&D here, you are likely, in the development phase, to precondition who is going to be supplying the ultimate product. 13. This is the background which has _ been necessary background for DTI and the Government’s industrial research policy generally. The score on inward investment is broadly that, some, we are glad of that, but there could be more. If you look at the balance of what has been happening on research and