Skip to main content

Science And Technology

Volume 264: debated on Friday 20 October 1995

The text on this page has been created from Hansard archive content, it may contain typographical errors.

Motion made, and Question proposed, That this House do now adjourn.— [Mr. Mackay.]

[Relevant documents: The Second Report from the Science and Technology Committee of Session 1993–94 on the Forward Look of Government-Funded Science, Engineering and Technology 1994, HC 422; the First Special Report of Session 1994–95 containing the Government's Reply thereto, HC 216; the Multi-Departmental Scrutiny of Public Sector Research Establishments, the First Report of Session 1994–95 on the Efficiency Unit Scrutiny of Public Sector Research Establishments, HC 19; the Government response to the Efficiency Scrutiny, Cm 2991; and the Third Report of Session 1994–95 on Human Genetics: the Science and its Consequences, HC41-I.]

9.34 am

The President of the Board of Trade and Secretary of State for Trade and Industry
(Mr. Ian Lang)

I am delighted that so early in my tenure of office as President of the Board of Trade the Government have made time available for this important debate. It reflects the importance that we attach to the subject and it is particularly timely in the light of the transfer of responsibility for science and technology to the Department of Trade and Industry.

The United Kingdom is outstandingly good at science and technology. Our scientists and engineers are world class. There are many peaks of outstanding excellence which are widely recognised as such. I must beware of highlighting single areas, but one has only to think of recent achievements in molecular biology to appreciate this truth. The United Kingdom's success in attracting the European Bioinformatics Institute to Cambridge is an excellent illustration. There, it will form part of a new world-class centre for the study of genetics. There are other examples of excellence that I could quote.

Our strength in science is a huge national asset which draws in investment from around the world—for example, in the electronics industry. Our ability to compete in world markets depends increasingly on producing world-beating high-technology, high value-added goods and services. Science and technology are central to this, but it is not only our wallets that science affects. Science is relevant to the environment, transport, employment and almost every aspect of our lives. For example, in addition to being a prime means of competing effectively in wealth creation, science and technology also underpin the improvements that we are making and continue to make in the quality of life.

Pharmaceuticals, medical techniques in diagnosis and treatment and improved understanding of the environment and the ways in which we can co-exist harmoniously with the natural world are all underpinned by science and technology. The United Kingdom is world class in many of those areas.

Before I go any further, I should acknowledge the valuable work of the Select Committee on Science and Technology of this House. The Committee has tackled a variety of important topics and played a considerable role in drawing scientific and technological issues to the attention of hon. Members and the community at large. The Government have recognised that in their support for the continuation of the Committee as a separate body, following the transfer of the Office of Science and Technology to the DTI.

In the past 18 months, the Committee has produced reports on the routes through which the science base is translated into innovative and competitive technology, on the "forward look", on the merger of Glaxo and Wellcome, and on the Government's scrutiny of public sector research establishments. All have been influential on the Government's thinking. In July, the Committee published a report on human genetics, to which the Government will respond shortly. The Committee is currently conducting an inquiry into the technology foresight programme. I very much look forward to answering the Committee's questions on that and other topics when I appear before it next week.

The Government have brought science and technology to the forefront of policy. The 1993 White Paper "Realising our Potential" was the first major statement of science policy for almost 30 years. The White Paper expressed pride in the excellence of our scientists, engineers and technologists, and set out the Government's determination to see that excellence better used to create wealth in the United Kingdom and to improve our quality of life. The White Paper saw the key to achieving that goal as the building of partnerships between the science base, Government, business and other users.

The White Paper was widely welcomed for its vision and boldness. Since 1993, the Office of Science and Technology has made great strides in taking forward the White Paper initiatives. The White Paper remains the basis for our policies and the OST will continue to work within that framework.

When I took over the helm at the Department of Trade and Industry, I announced my intention to focus a great deal of my efforts on developing the science and engineering base. Part of that focus is an emphasis on improved connections between firms and the science and engineering base which will help them to achieve and maintain competitiveness in world markets. In the highly competitive and technologically intensive world in which our firms have to compete, it is essential that they are fully able to understand, gain access to and apply scientific and technological advances. If they do not do so, they will fall behind our competitors. To be able to do so effectively and speedily, they need good connections to expertise and skills in the science and engineering base. I am greatly encouraged that that is being realised by an increasing number of firms.

Our approach can be summed up as excellence plus partnership. We are determined that Britain's basic research must stay top of the class, and we place great importance on forging closer links between the science base, industry and Government.

From his position at the helm of the DTI, is the President of the Board of Trade comfortable with the fact that so much of the research is done on a short-term contract basis? In the past 15 years, short-term contracts have increased by 217 per cent. and permanent posts by only 2 per cent. Is the right hon. Gentleman happy about that situation?

The time scale of research is less important than the outcome and the Government's continuing commitment to ensuring that research, both basic and applied, is properly funded and that proper priority is given to it by the Government, universities, research councils and industry.

Is it not the case that a researcher on a short-term contract is not fully productive for the whole two or three years for which that contract applies? One of the problems is that university researchers are finding it difficult to get jobs when their short-term contracts are completed, and spend the last 12 months of the contract looking for other work rather than doing the research.

The American experience does not bear out what the hon. Lady has said. I do not believe that the short-term contracts to which she refers, which are the way of the world not just in science but throughout industry, jeopardise the quality of research, and I see no evidence that they do. If any such evidence became apparent, I would be interested to see it.

I must press on, but I will give way to the hon. Gentleman later.

This emphasis on forging closer links between the science base, industry and Government is how to see the move of the OST to the Department of Trade and Industry. We need to make the most of the potential vicinity between our science base and industry. I shall say more about that in a moment.

The basic point is clear—bringing industry closer to science and stimulating it to build up its own research base is good for Britain. It is not in any way to downgrade science, but is saying that Britain needs top-quality basic and strategic research. It needs investment in science and technology for the longer term, but it cannot afford to overlook the benefits from science that arise along the way. If there are opportunities for closer working between science and industry—for sharing resources and similar goals—let us make the most of them.

Some people have expressed concern about the OST's move. Let me repeat what my right hon. Friend the Prime Minister and I have said before. The policies of "Realising our Potential" go on. There will be no lurch to short-termism. I fully accept that the role of the science base is to undertake long-term basic and strategic research.

The Prime Minister and I have made it clear that the roles of the chief scientific adviser and the Director General of the Research Councils are unaffected by the transfer. I have regular meetings with the chief scientific adviser, who also retains his direct access to my right hon. Friend the Prime Minister. The OST will continue to exercise its transdepartmental role of developing and co-ordinating policy for science and technology across all Government Departments. For example, it is co-ordinating the Government's response to the Select Committee's report on human genetics, which I mentioned.

The move to the DTI is not a threat, but rather an opportunity.

Can the President of the Board of Trade explain the relationship between the OST and the chief scientific adviser on the one hand, and the research and development for which the rest of the Department of Trade and Industry is responsible, particularly establishments? Is the chief scientific adviser responsible for those establishments?

The chief scientific adviser has a responsibility for all science conducted throughout all Government Departments, including the scientific work internal to the Department of Trade and Industry and the OST, which has now been brought into the DTI. I hope that that clarifies the position for the hon. Gentleman.

Specifically, in the management structure of technology and research and development within the DTI, does the chief scientific adviser come in a line with those establishments and the right hon. Gentleman?

There is no distinction between the internal scientific work of the DTI and the scientific work of any other Government Department undertaking such work, as regards the relationship with the chief scientific adviser. The fact that the OST has become attached to the DTI does not undermine the internal DTI scientific work or the position of the chief scientific adviser, whose responsibility is spread right across Government.

I apologise to my right hon. Friend for pursuing the matter, but I think that what lies behind the question of the hon. Member for Motherwell, South (Dr. Bray) is that the DTI would appear, uniquely among large spending research and science departments, to have no chief scientific officer of its own. Dr. Robinson has not been replaced. Would my right hon. Friend care to comment on that?

I do not know what my hon. Friend is so concerned about, because there has been no change in the context of the overall responsibility of the chief scientific adviser, or indeed of the Director General of the Research Councils. The fact that the OST has been moved into the Department of Trade and Industry does not undermine its role, or the activities of or responsibility for DTI research, or any of the commitment that exists towards that. I think that I have made that position fairly clear, but if my hon. Friend wants to pursue the matter, I will be happy to try to clarify it further.

I do not see the move to the DTI as a threat. I see it as an opportunity. The key message of the 1993 White Paper was that the United Kingdom's business and science needed to get better connected. Progress has been made since that White Paper. Much of the initiative has come from the science and engineering base.

Our efforts to encourage scientists to forge links with business need to be met by an equal willingness on the part of business to engage with science. All sectors of business need to open their minds to the potential for using technology to enhance their cutting edge. This is where the opportunity lies for new approaches, drawing on the combined resources of the OST and the rest of the DTI.

It is interesting that we are having this debate on the OST's move today, after the event. One of the helpful words that the Government have introduced into the debate is "foresight", yet the White Paper suggested an independent OST to pull Departments together. Where was the planning, preparation and public discussion before the decision to move the OST was sprung on us on the afternoon of 4 July?

These decisions were taken before I took responsibility for the matter. My right hon. Friend the then President of the Board of Trade might have been influenced by the Labour party document that I have here, which committed the party to co-ordinating science and technology under a Minister for science in the new DTI. That was a commitment in the Labour party manifesto for the 1992 election.

The science and engineering base is the engine house for new ideas, trains the next generation of highly qualified engineers and scientists, and provides a dynamic source of advice and expertise to enable us to exploit new ideas wherever they may originate. It is one of the cornerstones of our approach to enhancing national competitiveness.

Basic science permeates all places—[Interruption]—including this Chamber, and basic science, undertaken purely out of curiosity, has often led to advances in different products or processes, including bleepers, pagers and mobile telephones. An obvious example is the way in which early work on molecular biology has led to major advances in medicine—for example, the identification of a gene that causes a particular type of kidney disease.

The time scales are often quite long, however, and the Government recognise that they are the prime sponsor for such work. They take that responsibility seriously, and have a long record of sustained support for basic and strategic science. Since 1979, the science budget, which supports the research councils, has risen in real terms by about 30 per cent., and now stands at nearly £1.3 billion.

Some firms have responded to that increase in funding by increasing their investment in the science and engineering base.

On the identification of genes, is the right hon. Gentleman or the Minister who is to reply to the debate going to say anything about the byzantine problems of the patenting of such genes, especially in relation to the tricky question of personal insurance and the knowledge of defective genes that might be given to insurance companies?

We are aware of the concern over that matter. If the hon. Gentleman would like to develop that point during the debate, my hon. Friend the Minister will certainly want to respond.

Some firms have responded to the increase in funding to which I referred by increasing their investment in the science and engineering base—a real terms increase of nearly 20 per cent. between 1987–88 and 1993–94. That interaction does not drive the universities in the short term; rather, it provides the all-important dialogue between the academic community and industry. However, we must recognise that there is still a long way to go.

The Department of Trade and Industry is working hard to stimulate the dialogue and improve the climate for business innovation by promoting best practice in business management and the use of technology, and by supporting the development and application of new technology through collaborative R and D programmes. In addition, the DTI focuses help on small and medium-sized firms through the SMART and SPUR schemes, which provide grants for the development of new products and processes.

Through the work of the innovation unit in particular, the DTI is seeking to change attitudes in both the public and private sectors in favour of innovation. That is being achieved by improving communications between companies and financial institutions on longer-term investment and development, the annual innovation lecture and publishing the annual scoreboard of company R and D expenditure. The Government are developing a more comprehensive innovation index for introduction during 1996 to promote further analysis and debate about innovation in firms.

The real point about the R and D scoreboard is that it shows an appalling lack of investment by UK companies in research and development. Would the right hon. Gentleman care to comment on the 1994 figures, which, from memory, show that about £7 billion was spent by the top 362 UK companies on research and development, compared with £14 billion paid out to shareholders? In the top 200 world companies, the ratio of investment in R and D to shareholders' dividends is completely reversed.

The hon. Lady seems to discount all the work that we are putting into technology foresight and all the schemes designed to increase and stimulate R and D.

I disagree with the hon. Lady's figures. The figures for overall public and private investment in research between 1986 and 1993; the last available figures, show a 6 per cent. real increase, with the private sector contributing some 70 per cent.—about £9.5 billion. That trend stands pretty good comparison with most of our industrial rivals.

As we acknowledged in the second competitiveness White Paper, "Forging Ahead", alongside the UK's proud scientific record there is ground to make up in commercial exploitation. There are huge opportunities ahead for the United Kingdom if we can strengthen the links between our outstanding basic research and commercial exploitation. This is an area where the OST and the rest of the DTI with its knowledge of industrial sectors and wide range of activities to promote the health of small firms can work closely together, complementing each other's efforts at improving the interface between science and business.

The partnership between the DTI and OST in the LINK and teaching company schemes reflects the wider partnerships which we are seeking to forge between the science base and industry throughout the country. The Government are taking further steps to encourage the development of productive connections of this sort. For instance, we recently announced the OST competition for industry-academe collaboration, and the DTI competition for technology transfer to reward those in universities and technology transfer units who are successful in building such connections.

We must not forget the people dimension. People are central to the science and engineering base, as they are to industry and commerce. In particular, the key to partnerships of the sort that we have in mind is encouraging movement of people. This helps the flow of ideas and knowledge, breaks down barriers and builds up understanding and mutual trust. The Government support a number of schemes to promote this movement of people, including the teaching company scheme, postgraduate training partnerships, the shell technology enterprise programme and co-operative awards in science and engineering.

The technology foresight programme is central to our efforts to strengthen the science-business partnership. The 1993 White Paper announced the Government's intention to conduct a national technology foresight exercise, building on the theme of partnership, to bring together industry, academia and Government to reach a shared vision of future market and societal changes and the science, engineering and technology required to underpin, advance and exploit them.

Over 10,000 individuals took part in the exercise, through workshops, seminars or Delphi questionnaires, giving their expert opinions on one or more of the 15 sectors identified. That first phase of the programme culminated earlier this year in the publication of the 15 panel reports and the report of the steering group whose job it was to advise Ministers, through the chief scientist, on all aspects of the programme.

I am pleased to report to the House the support and interest that the reports have received both from within the United Kingdom and from other countries. The Government have stressed their commitment to the foresight programme as a continuing process through which we can establish active networks and clubs between science and every sector of business—small firms as well as large. In particular, we aim to make firms more aware of what is on offer from the UK science base and of the value of wise investment in and use of technology.

The Government also want foresight to inform priorities within publicly funded science and technology. As the 1993 White Paper said, neither the UK nor any other country can afford to cover all areas of research equally well; priorities will inevitably be set. We must ensure that the process of priority setting takes due account of strategic relevance to wealth creating and the quality of life. Technology foresight will help to inform that process. One key strategic aim—extend quality life, or EQUAL—is to extend the active life of our aging population, drawing on our great strengths in biotechnology, medical research and our strong pharmaceutical industry.

Industrially relevant basic and strategic research can be as challenging and exciting as pure research, and can open up new challenges and opportunities for academic scientists. Contact with industrially relevant problems and needs can also stimulate creative scientists and engineers to tackle these problems with imaginative approaches. It can also enable scientists to try out their ideas on a larger scale and in a more realistic environment.

At the same time, the Government are clear that we should not go too far in directing basic research into areas perceived to be relevant now. We must retain an adequate balance of research driven by curiosity alone with a view to longer-term wealth creation. The foresight exercise has already achieved a great deal, thanks to the enthusiastic participation of the panels and their chairman, and all those they consulted in producing their reports.

In the next phase, there are two main challenges. First, we must ensure that the foresight recommendations are intelligently reflected in the balance and direction of publicly funded science and technology, while we continue to nurture the seedcorn of fundamental research. Secondly, we must encourage a positive response from industry and commerce to the opportunities identified by the foresight reports and using the foresight process to help secure more and better quality academic and business links.

The foresight challenge competition, announced last month, will catalyse science-business partnerships by providing pump-priming funding for collaborative foresight projects. My Department is also providing funds to support regional seminars and clubs to push forward the foresight agenda within business across the country.

The Minister makes two points that I would have raised anyway. Could he comment on the view of vice-chancellors and principals that this policy is already distorting the type of research being done, and that highly rated basic research is not being undertaken and money diverted to lower-rated research because it has more interest for industry?

That point was mentioned by the Royal Society in a recent comment on technology foresight, I met the president of the Royal Society earlier this week, when we discussed the matter. I do not believe that there is a distortion. Of course, that is something about which we are anxious to be careful. However, the recent Realising Our Potential Awards, details of which I announced yesterday in the report and hope to mention shortly, do not suggest to me that there is such a distortion.

The Government have also started on the process of implementing technology foresight outcomes. For instance, new LINK collaborative programmes have been launched directly in response to foresight, covering as diverse a range of target areas as applied bio-catalysis; waste minimisation through recycling; genetic and environmental interactions in health; and earth observation.

LINK is the Government's principal mechanism for supporting collaborative research programmes, and an indication of its success is that over 570 LINK projects, worth over £300 million, and involving more than 800 companies, have been started since its conception in 1988. Collaborative research is not short term. It requires sustained commitment, via schemes such as LINK, over many years to make it successful.

There is a huge programme of activity going on within Government and outside to take forward the technology foresight exercise. For example, the DTI's sector divisions have a key role in interpreting foresight output to industry, putting them in the context of the competitiveness messages which the Department discusses on a day-to-day basis with companies. Most importantly, foresight gives an excellent opportunity to encourage firms generally to think more strategically about their business and future markets. The Government will publish a first progress report on how the exercise is being taken forward at the end of this year.

The Realising Our Potential Award scheme—ROPA—is an important and successful element in the Government's science strategy. It has two main aims: to encourage academic researchers to collaborate with industry in strategic research; and to enable them to carry out undirected research in any area of their own choosing.

We have two years' experience of ROPAs: the 1994 pilot scheme; and the subsequent full scheme in 1995, both of which were operated by the research councils. The response has been tremendous, and the scheme has clearly captured the imagination and interest of both academics and industrialists. We have had more than 1,500 applications for ROPAs, and those researchers quoted more than £260 million of funding from industry in support of their applications; 719 ROPAs have been awarded, some to the top names in UK science and engineering. The awards so far have a total value of some £71 million. All of it is for curiosity-driven research of the researchers' own choosing. A detailed report was published yesterday.

The President may be aware that, in response to yesterday's report and the two years' experience of the scheme, including the refinement of the guidelines, the Royal Society of Chemistry, for example, which was initially cautious, is now prepared to give a positive response, and says that the future now rests on the shoulders of individual researchers.

I am grateful to the hon. Gentleman for that encomium for the scheme. It certainly reflects the warmth of the reception for it that I have also recognised.

ROPA grants have gone to the top-rated research departments in our universities. Two thirds of such ROPAs went to those rated in the top two bands, which is a greater concentration than for many other grant schemes.

Would the President care to comment on the report by one of the panel chairmen of the Medical Research Council, who commented that ROPAs were forcing him to give grants to research which it would be better not to fund? There have been many comments about the quality of research done under ROPAs. Indeed, in some areas they are becoming known as "ropy ROPAs".

That is dealt with in the report. The whole point about the awards is that they are for curiosity-driven research. It is easy for somebody in a particular discipline of the science world to say that the areas being chosen are not worth pursuing; but it is only by carrying out curiosity-driven research—blue-skies research—of the kind that ROPAs exist to encourage that we can make the progress that both sides of the House are keen to see.

Some universities and institutes have been very successful in seeking ROPAs, and the most successful include Cambridge and Imperial college. In terms of departments, biological sciences, chemistry, engineering and medicine were particularly successful, while the industrial support quoted by applicants was dominated by the chemicals, engineering, medicine and pharmaceutical sectors. It is probably significant that these include many of our most successful companies.

On the other hand, the ROPA results tell us that we need to do more to bring other sectors of industry into play. The recent move of the Office of Science and Technology into the DTI can help that process, through bringing together a combination of initiatives such as foresight, ROPAs and the activities of our business links teams and the DTI sectoral divisions.

The 1993 White Paper recognised that there were still deep-seated cultural barriers in this country, which prevented full recognition of the importance of science and technology. Serious media coverage of science and technology was thin. Many people were ignorant and fearful of science and technology, if not openly antipathetic. We have made some progress. The BBC has greatly improved its coverage, and it is possible to point to some examples of first-class journalism. Nevertheless, there is still too little recognition among the general public of the extent to which our economy and the whole fabric of our society rests on science and technology.

The White Paper therefore launched a new Government campaign to spread the understanding of science and technology among young people and among the public at large. The campaign is a central part of our efforts to pull science and technology more fully into the UK cultural mainstream. I share my predecessors' view of the importance of promoting public understanding, and I shall take forward and develop their initiatives, particularly the establishment of National Science, Engineering and Technology Week.

We have also launched a parallel initiative in engineering entitled "Action for Engineering". It brings together the academic community, the engineering institutions and business to build on the opportunity offered by the coming together of the engineering institutions under a new engineering council to project engineering's contribution to our national life.

Earlier this year, the OST set up a committee under the chairmanship of Sir Arnold Wolfendale to examine how professional scientists and engineers could better promote public understanding of their work. I am pleased to announce today publication of the committee's report. Hon. Members will be aware of the critical role played by scientists and engineers in generating national wealth and improving public well-being. The report highlights the need for such awareness among the wider public. It is vital if we are to fire the enthusiasm for science of able young people and encourage informed debate of the major scientific issues that affect us all.

The report makes a number of important recommendations on how scientists and engineers can be encouraged to communicate to a wider audience. The recommendations directed to my Department—for example, the publication of a good practice guide—will be implemented, and I commend to other organisations the recommendations that apply to them. I am grateful to Sir Arnold and his committee for the work that they have done.

I am conscious of time pressing on. There is a great deal more that I could say about the Government's science and technology policy. It is an area of vigorous activity reflecting the urgency that we feel of realising the potential of national strengths in science and technology. Within the DTI, we are taking forward a range of activity to promote awareness of the importance of innovation and best practice in managing innovation—for example, through the managing in the nineties programme. That programme spreads best practice in its broadest sense, including innovation, management and the application of new technologies.

The DTI is promoting access by firms to technology from the UK science and engineering base through a number of activities, such as the teaching company scheme centres at universities, as well as through the NEARNET and SUPERNET networks available at business links. The DTI's overseas technology services give UK companies access to overseas science and technology—for instance, through the expanded engineers to Japan scheme and the overseas science and technology expert missions scheme.

The DTI and OST are active on a wide front internationally, promoting opportunities for UK researchers to engage in collaborations with overseas partners where it makes sense for them to do so. In Europe, under the third framework programme, UK researchers secured more research contracts than any other single member state. We are endeavouring at least to maintain that performance under the fourth framework programme. UK researchers have a deservedly strong reputation internationally, which is why others want to work with them. That strength also offers us the opportunity to use our capabilities in science and technology to promote UK exports and attract inward investment, which we do vigorously.

My hon. Friend the Under-Secretary of State for Science and Technology is hot-foot from attending the ministerial Council of the European Space Agency. There are those who have chosen to misunderstand our attitude to the ESA. The UK is committed to collaboration in space through the ESA, and fully recognises the excellence of the ESA's research programme. Nevertheless, it is imperative that the ESA is not spared the disciplines of economy, efficiency and effectiveness that we would expect to apply to the administration of science in the UK. We must not allow growth in the cost of space mission infrastructure to squeeze out our ability to contribute fully to the science.

My right hon. Friend refers rightly to the important work that is done in the European Space Agency, and the need to ensure that it is done efficiently. Does he accept that one of the consequences of ESA spending is that the money available for national programmes, to be applied to matters that fit our national priorities, has been reduced and become very limited in recent times? The danger is that, in areas such as global navigation satellites, for example, we may find that useful leads by our industry are squeezed out for lack of funding in the future.

My hon. Friend makes a sound point, of which we are aware. It is precisely to avoid the danger of the problem that he identifies that we are keen to emphasise the need for efficiency and effectiveness in the use of the funds that we devote through the ESA.

At home, we are improving the co-ordination of science and technology across Government. The 1995 "forward look" presented a comprehensive overview of Government Departments' plans for science and technology. It reported on the steps that the Departments are taking to improve collaboration with each other, and on their progress in aligning their science and technology more closely with the needs of business and in ensuring that the potential for commercial spin-off is fully covered.

We are also working to improve the efficiency and value for money of the substantial public investment in science and technology—by, for example, exploring the scope for closer working between public sector research establishments. My Department has worked successfully to bring a more commercial approach to bear on its own laboratories through a programme of privatisation and contractorisation.

We have improved the career management of researchers in the science base in consultation with the Committee of Vice-Chancellors and Principals. We have relaunched, and injected additional funds into, the LINK scheme, with the result that it is already delivering collaborative R and D programmes that take forward foresight recommendations. We have established a development unit within the OST to promote the participation of women in science, engineering and technology, which has already achieved a great deal, working with voluntary organisations and industry.

I am just about to finish. I hope that my hon. Friend will forgive me for not giving way, but many hon. Members wish to participate in the debate.

As President of the Board of Trade and Minister in the Cabinet with responsibility for science and technology, I am fully committed to sustaining the momentum and direction of the Government's science and technology policies. The OST and the rest of the DTI are working together towards a common strategic aim: developing and nurturing the excellence of our science and technology and ensuring that industry—indeed, society as a whole—makes more use of this vital national asset for the greater good of the British people.

10.11 am

I welcome the President of the Board of the Trade and the Minister for Science and Technology to their new appointments: I believe that this is the first time that we have debated science across the Dispatch Box.

I congratulate my right hon. Friend the Member for Derby, South (Mrs. Beckett) on her appointment yesterday as shadow Secretary of State for Trade and Industry. She has a long-standing and deep commitment to science, engineering and technology, and I look forward to her being with us for such debates in the future.

Are we to understand that the first action of the new shadow spokesman for Trade and Industry is not to turn up for a science and technology debate?

That is a cheap and churlish remark. My right hon. Friend was appointed only yesterday and it is not reasonable for her commitments simply to be torn up; there is a little interregnum. I hope that the hon. Gentleman will have the good grace to join the House and extend a word of welcome to her.

I will take a question in a moment.

May I take this opportunity to invite Conservative Members to extend a word of congratulation to Professor Joseph Rotblat on his Nobel peace prize? It is a rare and deserved example of the contribution of science to peace. We should, not least in this debate, congratulate him.

As far as we are aware, Professor Rotblat is still awaiting congratulations from No. 10. Have they yet been sent?

As my hon. Friend knows, I cannot answer for No. 10, but I hope that in this debate the President of the Board of Trade and Conservative Members will congratulate him.

Nobel prizes have recently been awarded for a range of scientific disciplines and the winners deserve our congratulations. The timing is all the more poignant as the winning projects are considered to have been ones that may not have received funding from the Government. Nature of 12 October reports:
"Peter Lawrence, a geneticist at the laboratory for Molecular Biology in Cambridge, described the trio"—
those who won the Nobel prizes for science—
"as 'role models for scientists of the future'. The award, he adds, is a much-needed signal to science policy makers of the need to continue funding unfashionable, risk-laden, long-term projects whose result is not always in sight.
This research, Lawrence says, is the type of work that should be every scientist's bread and butter, but is becoming more and more difficult to achieve. 'I am convinced that Ed Lewis would not have got a grant in our days,' he says."
I emphasise that point because we question whether the Government have got the balance right between basic curiosity-driven science and technology transfer.

The Nobel prize for the discovery of the depletion of ozone in the upper atmosphere went to the Americans rather than to Joe Farman, the British Antarctic Survey scientist. That was perhaps partly due to the fact that Britain did not contribute any of the research infrastructure and the basic observation systems are carried out by the National Aeronautics and Space Administration, to which Joe Farman had only indirect access. The underlying problem is that British scientists do not have the heavyweight back-up of scientists elsewhere in the world.

That is a good point and I should like to extend it by mentioning the need to support international collaboration so that our scientists can be at the forefront internationally. I shall return to that issue.

Under this Prime Minister, there have been echoes of the past and of a Government locked into the nostalgia of warm beer and cycling past the village green. Suddenly, however, it seems that the Government have woken up to the information age of the new technologies. I understand that they now have their own world wide web page.

P. J. O'Rourke described modern politics as simply survival and the need to
"sustain an image of competence from one day to the next."
We believe that the Government's policy is characterised by that sustenance of the image of competence from one day to the next. Indeed, it sometimes seems that policy is now being decided and changed from one press release to the next.

The 1993 White Paper, "Realising our Potential", was released with great fanfare but the expectations that came with it have not been fulfilled; indeed, they have been dashed. The policy potential of the White Paper has not been realised. The Office of Science and Technology has not fulfilled the role that it was established to fulfil—that of co-ordinating departmental research and development across Government. The suggestion that it was simply pushed into the Department of Trade and Industry does not match the foresight or planning prefigured by the Government. It is up to us to get out of the world of press releases and out of this place to see what is happening on the ground.

Two months after his appointment as the Cabinet Minister responsible for science, the President of the Board of Trade made his first visit to Keyworth to see the headquarters of the British Geological Survey. I was told that he had been there when, a few days later, I went out with the British Geological Survey on Baildon moor to examine its research methods. It is important that we get out to see what is being done by our research establishments.

Sadly, this year for the first time, people were disappointed that not a single Cabinet Minister was present for the British Association for the Advancement of Science's week-long festival in Newcastle, although the Prime Minister was in Newcastle at the time. He turned down a personal invitation to present an award at the ceremony for young European scientists so that he could have a private meeting with party activists instead. It was a surprising move. When asked to explain why he could not be there, or even squeeze in a five-minute photo call, the Prime Minister replied:
"Whether it is a good or bad thing, there are slightly more football supporters in the United Kingdom than there are space scientists."
The comment in The Daily Telegraph was:
"Translation: Short-term considerations are more important than the long-term impact of British research on the national wealth and quality of life."
As much as I love my home team, Leeds United, I do not consider being at its games more important than ensuring that the manufacturing base of Leeds is sustained so that people can afford season tickets in the future.

I am afraid that the hon. Gentleman introduces childish criticisms. He and I were both at the British Association for the Advancement of Science, which is the right and proper way of taking seriously its excellent week, and I am sure that he took part in as many experiments with the various children's groups as I did. The remarks that he attributed to the Prime Minister were remarks that I made flippantly. Fortunately, Roger Highfield's subsequent article in The Daily Telegraph would have failed any peer review, so I believe that the hon. Gentleman would not wish to embarrass Roger Highfield further by mentioning that article.

I think I can allow the Minister to take his complaints about the press to the appropriate place.

While the hon. Gentleman is dealing with the British Association for the Advancement of Science, will he pay tribute to the work that it and its committees do to improve public understanding of science? They do a great deal in that respect.

Absolutely. We can share that view across the Floor of the House.

I take the Minister's point. It is important that we try to attend and give the British Association for the Advancement of Science all possible support. Its work is excellent.

Science week should be extended. Instead of there being a single week celebrating science and technology primarily focused on schools, the whole of commerce and industry should have open days or open weeks throughout the year so that we can better understand what manufacturing engineering and technology is about and can understand more about research and development. We need to extend our vision of the role of the British Association for the Advancement of Science and to do everything possible to support it.

Under the Conservative Government, despite the encomium that we heard from the President of the Board of Trade, there is a feeling that research and development continues to be marginalised and demoted. It is not being pushed further up the political agenda, as he suggested.

Let me reflect on the role of the right hon. Member for Henley (Mr. Heseltine), the First Secretary of State, the Deputy Prime Minister, the man noted for his back-of-the-envelope outlines of the future. It seems to me that, on that hot summer's afternoon on 4 July, he had another back-of-the-envelope plan of how the Government should be run. He was to leave the Department of Trade and Industry and move to the Cabinet Office in his new role, but he kicked science behind him. He pushed the Office of Science and Technology back in the opposite direction.

It was as though science and the Office of Science and Technology were an afterthought, a left-over. Where was the planning, the consultation, the involvement of the Department's staff in that sudden transfer of the OST to the DTI, not to mention the appointment of the newly appointed Government chief scientific adviser—whom, incidentally, I welcome to this place and to his post?

There did not appear to be much foresight in that decision. It appeared to be a classic afterthought by the then President of the Board of Trade as he moved into the new role of Deputy Prime Minister.

So what do we get? Science is put into its third Department in as many years under the Government. We have now the fourth science Minister in as many years. That is it—science has become a reject of the new Deputy Prime Minister. Or is it? The President of the Board of Trade told me that he has Cabinet responsibility for science, yet the Deputy Prime Minister tells us that he chairs the Cabinet Committee covering science and that science is now subsumed under the sole heading of competitiveness, along with other disciplines.

The White Paper on competitiveness was presented to the House. We had a debate on competitiveness. On the same day, all the technology foresight reports and the "forward look" document, which we welcome and which we would have wished to comment on, were not presented to the House. They were presented in a press conference at 5 o'clock in the Queen Elizabeth centre by the then President of the Board of Trade. In other words, they were subsumed to competition policy. Science was tagged on to the launch of the competitiveness White Paper.

We are left with the lingering question: who ultimately is the Cabinet Minister responsible for science? Or is the President of the Board of Trade in effect another deputy's deputy, with which we are becoming so confusingly familiar? I hope that the Minister for Science and Technology will not take offence when I say that I hope that he has not been asked to reply this morning on behalf of the real science Minister, the right hon. Member for Henley.

There is confusion about who is responsible at the heart and centre of Government for science policy. It is a shambles of an arrangement. What a way to treat our country's future. No wonder the Save British Science Society has commented:
"A Government with so little regard for the intelligence of the research community shows a stunning lack of true 'Foresight'. Many will question whether this is any longer a Government whose words and intentions can be respected."
With the best of respect to the new Ministers, I know, from seeing for myself in perhaps more than 100 visits to research establishments, universities, laboratories and businesses throughout the country in the past nine months, how lacking support and credibility are now in the field of the Government's science, engineering, technology and research and development policies.

Having seen that, I believe that we should be in no doubt of the scale of the science and technology challenges that we must face, and which the Government so manifestly fail to tackle.

The hon. Gentleman makes a big point about that, but I should remind him that the former chief scientific adviser has made very positive remarks about the transfer from the Office of Public Service and Science to the DTI—in his article in The Daily Telegraph of 19 July, not least. The new chief scientific adviser has specifically told me that the transdepartmental responsibilities of the chief scientific adviser have been preserved entirely. Those are two very eminent gentlemen, and I hope that the hon. Gentleman will take that into account.

I will take that into account, but it is interesting that their comments come after the event, not before. There were no hints before that that would happen. There were no fliers from the chief scientist at the time suggesting that that was the way forward—and he had ample opportunity.

I wish to comment on the remark attributed to the new chief scientific adviser. He, of course, had no experience of the previous system when there was a Cabinet Committee directly concerned with science and technology. That has been abolished. It is difficult to understand how that makes it possible to continue those central co-ordinating arrangements with the same effectiveness as in the past.

The hon. Gentleman makes a good argument. I seem to recall that, at the time of the transfer, he made those arguments public. They are welcome.

In a way, the debate is post hoc; it has happened. Nevertheless, we are anxious to draw to the Government's attention the fact that it hardly becomes them to defend the line of careful forethought when a decision is jumped on the whole of Government and Departments on a hot afternoon as a result of a crisis at the highest levels of Government.

I am confused by what the hon. Gentleman says. We know that it is Labour policy that the OST should be part of the DTI, and presumably it urged that because that is what it wrote in its documents.

The hon. Gentleman has bored the Chamber with a long diatribe about the move that has been made by the Government. I have to tell him, as a former junior science Minister, that I believe that it was exactly the right move. It was impossible to determine what was the difference between the technology parts of the DTI that my hon. Friend the Member for Esher (Mr. Taylor) was in charge of and the parts that I was in charge of at the Office of Public Service and Science.

It is a welcome move. For once, as the Labour party said it before and it had been thought of in government, the hon. Member for Leeds, West (Mr. Battle) might have welcomed it. That might be more constructive.

I am amazed that the former science Minister asks that question, because he gives me the chance to ask him a question. It would be interesting to know what he felt when he stood at that Dispatch Box saying how good the arrangements were, if he now feels that they were all wrong. He never told us that he was greatly unhappy with the OST and he believed that it should be moved to the DTI—and I know that some voices urged him to do that. He held out in the opposite direction.

My hon. Friend speaks with great authority about present Labour science policy. The President of the Board of Trade actually quoted from former Labour party policy in the manifesto at the last election, for which I was responsible. It was a highly selective quotation, in which he said that the Department of Trade and Industry was responsible for that area of industrial research. The overall concept of the Office of Science and Technology belonged firmly in the centre of Government. We were rubbished by the Conservative party at the time, only for it to adopt our policy after the election.

The document "Pushing Back the Frontiers" was published in 1992. We felt that the Government had stolen our clothes. We suggested the setting up of an office of science and technology within the Cabinet Office, which is precisely what the Government did after the election. We welcomed that because we thought that they had taken our idea.

We should face up to the science and technology challenges of our world in a less complacent manner than we saw from the President of the Board of Trade this morning. Science is becoming increasingly international. There are already 30 million people on the Internet. Within a decade or two there will effectively be a limitless capacity for fibre-optics and we will be capable of transporting the entire contents of the British library in less than a minute.

Scientific research can be accessed from all over the globe. Universities and scientific societies are pioneering new ways of making research internationally available. By the year 2005, 10 million people will be working with computer software in the countries of the Organisation for Economic Co-operation and Development alone. But the danger is that Britain will be left behind as American companies such as Mathwork make all the engineering inroads.

By the year 2010, there will be 2,260 telecommunications satellites in orbit—twice as many as there are now. Today, the Asian Pacific market for chemicals is roughly equal in size to the markets of the European Union and the United States put together. In 25 years the Asian Pacific market could be bigger than both put together. There have been new advances, not just in the industry, but in environmental technologies, education and health. Machines, materials, manufacturing and even the concept of transportation are being transformed by continuing advances in micro-processing, wireless networks, high-speed optical networks and artificial intelligence. It is an economy and society in which knowledge will be power; information will be opportunity and technology will make things happen.

How does Tory Britain prepare itself for the information age, when even more important than the technologies to communicate knowledge will be the capacity to generate the knowledge in the first place? What characterises the Government's approach to science, as in so many other spheres of policy, is that they cut budgets in the short term—they fragment, marginalise and demote.

Let us compare Britain to our international competitors, as both the OECD report and the International Monetary Fund report spelt out this summer. Let us compare ourselves with America, Japan, Germany and France. The percentage of GDP spent on research and development in Britain is lower than all the others, at 2.19 per cent. The United States spends 2.72 per cent. of its GDP; Japan spends 2.93 per cent. The President suggested that Britain was top of the class in terms of spending on research and development per head of population, but we are bottom of that league. Let us consider the number of people employed in research and development. Europe employs nearly 300,000 more today than in 1981, as does Japan. Germany employs 140,000 more; France employs 50,000 more and Italy 40,000 more. But here in Britain we employ fewer—nearly 40,000 full-time equivalents fewer.

British industry is working hard to boost research and development spending after a decline in 1990, when it was down 0.3 per cent. By 1993, it had risen 4.6 per cent. But despite the industry's efforts, Government cuts mean that extra investment in our society is wiped out. There has been a massive shift to part-time researchers on temporary contracts in our society—from 11,500 in 1982 up to 21,500 in 1994. What does that mean? Employees on short-term contracts worry about their next wage rather than the details of the creative research upon which they should be engaged.

The picture is not as rosy as the President of the Board of Trade suggested. The OST budget is projected to shrink by 12 per cent. next year and is being steadily undermined by cuts in research and development spending by other Government Departments. That action comes from a Government who claim in their press releases to be offering a teaspoon of aid through the OST with one hand, yet the fingers of their other hand are around the windpipe as Government Departments cut research and development across the board in health, transportation and the environment.

In the recent "forward look"—the Government's annual science review—total Government spending is projected to fall by 7 per cent. in real terms by 1997. By the financial year 1997–98, spending will be more than £1 billion less than it was in 1986. The worst culprit is the Department of Trade and Industry, where research and development programmes have been slashed by 68 per cent. in four years.

On the very day that the Government announced the White Paper, "Realising our Potential", the DTI, then under the right hon. Member for Henley, slashed £40 million from collaborative research programmes. It is no wonder that the scientific world is nervous of the OST's move into the Department of Trade and Industry.

This very day, while we are here debating science, the Chancellor is at his Dorneywood retreat, cutting Government departmental budgets. I am in some ways surprised that the President of the Board of Trade is here this morning. I thought that he might be at Dorneywood defending his budget. While we are debating the need for science spending, the Chancellor may be cutting the budget again at Dorneywood. Obviously, we shall have to wait and see, but to cut the science budget in order to deliver tax cuts in the coming Budget must be one of the most short-sighted economic decisions that can be made in our society.

Even industrial renovation research, funded by the DTI, is down from £104 million in 1993 to £85.6 million now. The national space programme has been halved. I hear that the Minister for Science and Technology was at the European Space Agency yesterday. The coded way in which the President of the Board of Trade reported back suggested that we should cut our cloth accordingly. I suspect that the Minister was at the ESA to campaign again for a larger cut—perhaps of 25 per cent. I should like to hear the details of the Minister's argument in Brussels and whether he argued to reduce our commitment to the ESA. I would welcome it if he would give us an answer.

Given the hon. Gentleman's interest in this matter, he will be delighted to congratulate us on our efforts in altering the balance within the ESA budget. There is to be a flat cash arrangement for the next five years of the ESA science budget, capped at a 3 per cent. level of inflation. All the members around the table at the ESA agreed to that. It was a difficult negotiation, but the key point was to preserve the science element. It was clear that if we had not brought that budget under more control than had originally been proposed, other member countries in subsequent years would have tried to take out key platforms from the science activity. I did not wish to do that.

I am grateful to the Minister for giving us some hints and I look forward to the details. The Government's record on the ESA is not spectacular. We are not involved in manned flight or telecommunications—we have pulled out from two key areas. We remain in one of the voluntary sectors: earth observation. But even there, if the Minister would care to visit the Meteorological Office, he would discover that we are making cuts. I gather that when the Minister was last at the ESA he sat at a table on which there was a model of the Ariane rocket. He asked why flags of other nations appeared on the rocket, but not the British flag. He was told that it was because we did not make a contribution, and that we could have our flag on the rocket when we made one.

The hon. Gentleman should be properly briefed before he comes to the Dispatch Box. I understand only too well that we are not part of the Ariane infrastructure project. He should wait and see what may happen this afternoon, although the injection of funds is still a matter for further discussion. He should recognize that we have been long-term contributors to the Kourou ground station. British companies play a part in the Ariane programme and we should pay tribute to them.

I am encouraged that, by raising more points, I am forcing the Minister to make more commitments. I am suggesting that it would be very beneficial for our industries if Britain were to be more "solidly at the heart of Europe"—as the phrase goes—in scientific and research and development terms. We have precisely the technologies, back-up technologies and commercial interests that would allow us to make a major contribution. In other words, British investment would pay off back home.

The space programme budget has been halved and, amazingly, the DTI renewable energy budget has been cut by one third. The Government raise value-added tax on fuel and then cut the renewable energy technology budget. Are they so short-sighted, or do they simply want to raise revenue in the short term at any expense?

We are told that the £1.3 billion budget of the OST will be protected when it moves into the DTI, which also has a budget of £1.3 billion—I think that "ring-fenced" was the term used in the press releases. How long will it be before that ring fence becomes a Chinese wall, as the DTI and OST budgets are fused and then cut year after year? That is what we have seen repeatedly in the development of technology and research in recent years.

Perhaps the President of the Board of Trade or the Minister for Science and Technology will deny that the budget of the Engineering and Physical Sciences Research Council is due for a real term cut this year, next year and the year after. Will they deny that there is a growing infrastructure crisis in university laboratories? In the last debate we raised the practical issue of the lack of fume cupboards—a basic support system for chemistry laboratories. Are the Government addressing that problem in any way? No Tory election tax cut is more cynical than one that is financed by undermining new research and development and scientific and technological possibilities. In other words, the Government are cutting our future economic prosperity and our social well-being. That is short-termism with a vengeance.

The Government are addicted to short-termism, and scientific research and development is paying the highest price for that short-term approach. Vital cash is increasingly diverted from the research councils into short-term, headline-catching, acronym-titled competitions that bear all the hallmarks of the right hon. Member for Henley—the competition addict. Some £40 million—which we were told was not new money—was allocated to the technology foresight competition. We were then told that the sum had to be matched by private money or it would not be released.

When the right hon. Gentleman was Secretary of State for the Environment, his Department initiated competitions every day. They proved to be simply a cover for reducing mainstream programming. When private funds do not match the money that is declared available, that sum is cut and less money is spent on the programmes. That has happened every time.

I shall take the Realising our Potential Awards as an example. Applicants must win funding for a project that is original and feasible and they must demonstrate that they have secured at least £25,000 of industrial income. I would argue that the worth of the proposed research is not considered properly as, increasingly, the research programmes that win cash are those that have failed on the basis of peer review. As the hon. Member for Wimbledon (Dr. Goodson-Wickes) pointed out in the House on Monday, alpha-rated research projects—that is the highest rating there is—are being passed over because resources have been diverted to less rigorous ROPAs.

The chairman of the Medical Research Council's molecules and cells panel has said that the ROPAs have meant that his panel was
"boxed into a corner where you had to fund something you didn't want to."
The Government's review of ROPAs, which was published yesterday, reports the research councils' concerns that they are being forced to fund "poor-quality" science. While the concept of ROPAs—to build links between industry and the science base—is good and one that the Labour party supports fully, the practice under the Government belies the intention.

Not only is top-quality research passed over, but the overall thrust of R and D funding is driven into the short term. Researchers cannot find support from industry for longer-term basic research for entirely understandable reasons: firms are unwilling to take the risk of funding research whose applicability is as yet uncertain and whose exclusivity to the funder is unlikely. The result is that funding goes instead to short-term, near-market research. We do not deny that such research is valuable in itself, but it is no substitute for long-term thinking. As the Medical Research Council panel chairman said, ROPAs in their current form have led to
"clinical trial work, not 'innovative science".
Everywhere one looks, Britain's science base is being threatened by the pressure for near-market research.

I have met many industry representatives and I do not believe that industry wants academia to do its job for it. Industry should not be expected to conduct basic, curiosity-driven, blue-skies research. In the same way, academics should not have to test products. I get a clear message from firms up and down the country: there must be a well-trained and resourced science base from which firms can draw people who are trained to the top of their field and who can be recruited to work to firms' near-market ends. Industry needs excellence and quality in British basic science.

The Labour party's policy is clear. The ROPAs can stay; we welcome them. But quality shall become the criterion. We shall restore a long-term time horizon and ensure that funding structures do not channel research projects short term and purely near market.

The Government's failure in the science field is not just about cash; it is also about the abject lack of co-ordinating strategy across the range of Government Departments, research councils and public and private sector research establishments.

The former Defence Minister gave evidence before the Defence and Trade and Industry Select Committees, which met concurrently on 23 May. He was questioned about defence research and the potential for generating new ideas and production. He said that he was keen that the notion of the potential of the defence industry should be extended. However, he did not even mention technology foresight; he seemed totally unaware of the defence aerospace foresight report. He referred to the technology demonstrator programmes, but he did not mention the technology foresight report, despite the fact that it had been launched only days earlier in the QEII centre.

Despite the Government's claims to the contrary, there is no co-ordination between Departments. Other Departments may not know what the Office of Science and Technology is trying to achieve. For example, the Wellcome Trust has reported that the university dual support system is collapsing because individual research programmes cannot justify the capital expenditure on equipment that the research requires. That is not to say that the research is not needed, the equipment is not necessary or that it will never be used again; there is simply no attempt to link the research between laboratories or Government Departments.

How do the Government think that they can remedy that situation? This morning we heard the new buzz-phrase: "fostering partnerships". That involves establishing networks of support between different branches of research. However, I am not convinced that that is really the Government's approach because, for some strange reason, they seem to be insisting upon privatisation and fragmentation. Their response to the scrutiny of the public research establishments has been to establish a prior options review of all public sector research establishments with a view to pushing them out to the private sector.

Research councils and Government Departments are to be reviewed on a function-by-function basis and analysed for their potential for transfer out of the Government domain and into privatisation.

We are entitled to ask what form the privatisation would take. For some weeks the House debated the privatisation of AEA Technology. Hon. Members on that Committee will recall that we asked repeatedly whether AEA Technology would be sold off en bloc or fragmented. We received no response. We fundamentally opposed the Government's strategy because they could not tell us how it will be sold. If it is sold off in fragments, that could undermine and pull apart a critical mass of scientists in a key area. Arguably, clean-up technology is a key area in respect of our environmental needs and should be at the forefront of technology rather than undermined.

Individual functions will be hived off and cherry-picked, tearing down the bridges and links that join research establishments. I visited the Laboratory of the Government Chemist, which is across the green at Teddington from the National Physical Laboratory. The Government are pushing out both those organisations to the private sector in different directions and by different means. Occasionally, however, scientists from the establishments get together and exchange ideas. We should be fostering coming together and development, not atomising and fragmenting, as the Government are by allowing individual functions to be pulled apart. That box or silo thinking pervades much of the Government's action; there is no serious joined-up thinking across Government Departments.

Labour will call off that ideological drive towards the privatisation and fragmentation of public sector research establishments. We realise that the principal aim of science and technology policy is to ensure the creation of effective technology support systems that bridge industry and the science base and build links within the science base to generate interactive scientific expertise.

We recognise that firms, universities and public research bodies are distinctively different institutions that are adapted to specific purposes, but, just as it would be foolhardy to make academic institutions into commercial ideas factories, so it would be foolhardy to make private firms non-commercial. It is foolhardy to push out Government expertise that has been built up over the years into the private sector to see whether it thrives or dies because we might kill off some of our much-needed expertise that will lead us into the future. The central problem of policy is how to connect and co-ordinate and we do not accept that the Government are moving forward in that strategic direction.

The establishment of the foresight panels is welcome, but the weakness in the Government policy is the strategic implementation plans. Where are the responses from other Government Departments? Where are the commitments to carry policy forward throughout the Government? In other words, the economic and social return from scientific research and development is not determined solely by the capacity to develop new products and processes. Equally important is the system of support for diffusing those technologies and the relevant applications.

Throughout history, British scientists are rightly reputed for their brilliance at researching new scientific advances. Science and engineering have been coming together for years, as the new paradigms of computer-aided design demonstrate.

I have to reflect that for some years the Government wrote off manufacturing industry. When the noble Lord Young was Secretary of State for Trade and Industry, he declared that the service sector was all, the manufacturing sector was over and that Britain would thrive if only more people would eat out. I remember it directly because in my city manufacturing was declining from 52 per cent. to 32 per cent. of the manufacturing base. However, there have been welcome and encouraging reports in recent days because of real partnership at local level between chambers of commerce, industry, universities and technology and the engineering initiative in Leeds. Manufacturing is starting to come back and we need a manufacturing base. I welcome the fact that the word "manufacturing" appears in a positive way for the first time in the past 10 or 15 years in a Government publication.

The examples of British excellence that result in profitable industry are diminishing. Not only is the basic science capability of Britain to generate such ideas being undermined, but the Government are failing to support industry and academia in their attempts to transfer ideas and technology back and forth. There is a weakness in Government because they are not tying together Government programmes with the outside world and research and investment in industry.

Science and technology policy needs genuinely to co-ordinate and encourage the take-up of scientific advances by industry, particularly small and medium-sized firms, where the shortfall is even more marked. As SmithKline Beecham remarked on the technology foresight programme:
"The challenge now is to ensure widespread dissemination and implementation of the Panel findings. This requires a coherent political strategy."
That is not what we were getting from the Government. It is a view shared by industry throughout the country and by many professional bodies, including the Royal Academy of Engineering, the Royal Society of Chemistry, the Royal Society and the CBI.

Partnership across Government and between public and private sectors can happen and under a Labour Government it will. We shall establish an industry-wide advisory council on new technologies, on which management and consumers will have a voice. We shall have a Minister to work with those and other innovations to ensure that we effectively promote change and understand in advance the long-term economic and social implications.

We understand that science and technology policy is central to the economic and social future of our country. Positive support for our manufacturing base needs to be enhanced and support needs to be returned to research into health, education, transport and the environment, which the Government have short-sightedly allowed to deteriorate because such research cannot deliver a short-term immediate cash return.

We shall work for better international collaboration. We shall seek not to isolate Britain in the European Space Agency, jeopardising our capacity to benefit from new advances that the agency makes, but to ensure that research and the work of scientists are supported here and internationally. Nor would we, alone among our competitors, allow the burden of an expected £10 billion increase in subscriptions to CERN to be borne by science expenditure here so that other programmes have to be cut to allow for currency fluctuations. Unless the Government act to deal with the impending international subscriptions crisis, the result will be a halving of resources available to the Particle Physics and Astronomy Research Council to prepare experiments and use CERN. The Minister may mention that in his reply to the debate.

We shall sort out intellectual property rights and tackle the science switch-off in education between the age of 16 and 18 when students are not taking sciences at a higher level. We will encourage the opening of local science shops to bring scientific understanding within the reach of local communities and we shall ensure that the Office of Science and Technology has a genuine co-ordinating function. We shall pull Departments together in a co-ordinated strategy, breaking down the narrow departmental thinking of the past.

We need a clear Government vision to infuse society with a deeper and broader sense of the vital importance of science, to bring about the long overdue shift from short-term to long-term perspectives on the economic, social and political possibilities of the future. We know from today's debate that the Government are still addicted to the short term. They are incapable of providing a vision and we suspect that science will continue to pay a high price until the election of a Labour Government.

10.59 am

This is an important debate on an important subject. In all the time that I have been in the House, we have never found a way of reconciling the inevitable short notice of Friday business with accepting, at longer notice, invitations to attend functions in our constituencies. The irony is that I have been invited to open a new science and technology unit at Heathside secondary school in Weybridge—an excellent institution and the first grant-maintained school in Surrey. The House would expect me to honour that commitment, so I apologise to my hon. Friend the Minister and the House for having to leave this important debate early.

I warmly welcome the confirmation by my right hon. Friend the President of the Board of Trade of the continuation of the Select Committee on Science and Technology, which is clear recognition of that Committee's effectiveness under the wise chairmanship of my hon. Friend the Member for Pudsey (Sir G. Shaw).

I will confine my brief remarks to the subject of intellectual property. It is widely agreed in almost every saloon bar in the country that we are good at innovation but not at exploitation. Part of exploitation is the protection of new ideas in the world of intellectual property. Announcing that one is to talk about intellectual property is a way of clearing a room of people quicker than shouting, "Fire!" In these Nolan-obsessed days, I should declare that I speak as the totally honorary and non-remunerated chairman of the Institute for Intellectual Property, which was created a year ago as a reformation of the Common Law Institute for Intellectual Property, known by many people as CLIP, which for 10 years, under the wise guidance of Lord Scarman and the late Stephen Stewart, provided an important focus for intellectual property activities.

The Institute for Intellectual Property continues the excellent research work of its predecessor but also combines a much-needed industry focus by having 10 important UK companies as founder members on its board of governors. The question sometimes asked, although not as often as it should be, is: how important is intellectual property to the United Kingdom? Two studies by CLIP on the economic importance of intellectual property showed that the copyright-based industries accounted for approximately £17 billion or 3.6 per cent. of gross domestic product in 1990, and that they employed more than 800,000 people. The patent-based industries accounted for approximately 2 per cent. of GDP. Both results have been widely accepted as conservative.

The figure resulting from the copyright study was cited by Ministers when presenting the Bill that is now the Copyright, Design and Patents Act 1988. On the best estimates available, the UK is second in the world league table of copyright producers and exporters, and fourth or fifth in the sale of products relying on patent protection. However, it would be dangerous to underestimate the forces that oppose intellectual property. At a national level, the consumer lobby would prefer that the products of the IP industries were either free—for example, by copying films and records off air—or at greatly reduced prices, such as with generic pharmaceuticals. But without intellectual property protection, there may be no videos, records or new drugs, because the companies that produce them could not recoup their substantial and essential investment.

Every democratic Government must be mindful that, for every creator or right owner who has a vote, there are 1,000 consumer votes and that, for every Bill desperately needed to bring and keep intellectual property up to date, a dozen other Bills are politically more important. At the international level, developing countries often resist intellectual property protection on the ground that they need IP-based cultural and technological goods for their development but cannot for the time being afford to pay for IP. Piracy, which usually involves copyright or trade mark infringements—or both—is estimated to cost UK businesses more than £1 billion, which is worth at least 100,000 jobs.

Industry competitiveness in the UK will increasingly depend on brain rather than brawn. The successful exploitation of public and private science and technology expenditure demands an effective intellectual regime. Products and services now reach the market place rapidly and are constantly updated. For example, the explosion in multi-media products and services for industry and consumers demand collaboration between creators and innovators in the entertainment, computer and communications industries. That rapid change requires intellectual property regimes to adapt at a similar rate if disputes between collaborators are to be resolved promptly and are not to inhibit progress.

The essence of patent and copyright law is the granting of a monopoly to an individual or a company for a specific period. The House will always be sensitive about monopolies and will not readily relinquish control. Therefore, IP law—except for the implementation of European Union directives under the Single European Act—cannot easily be covered by the secondary legislative process. The law is complex and it is expensive for IP owners to enforce their rights against an infringer. Typically, it costs £50,000 in the county court or at least £250,000, as a starting figure, in the Patents Court, which is a branch of the High Court.

Lord Woolf has produced an interim report on reform of the civil law. Cheap, fast-track litigation and simpler rules of procedure are needed, together with a level playing field in the EU. At present, in many EU countries—but not in the UK—the state subsidises litigation by paying for expert witnesses, which are always an expensive item. If we do not work rapidly to those objectives, litigants will shop around for the best service and disputes will be resolved in Dutch or German courts. That will further damage the UK as a trading centre.

The PIMS report "Panorama of EU Industry", which was published last month, concludes, among other things, that innovation and intellectual property are the strongest drivers of competitiveness, leading to a growing market share, value added and more jobs. Intellectual property, however, is valueless without a cheap and efficient means of enforcing rights. We should support Lord Woolf and the patent judges in their efforts to reform and modernise the law.

My concern is that the speed of technological change and innovation at which we marvel makes it difficult for the legal framework to keep pace. I am not convinced that the Department of Trade and Industry has adequate resources. If adequate resources and expertise were made available, the Law Commission could keep a watching brief and bring forward proposals when necessary in this crucial part of national activity.

11.8 am

This debate is timely, as are all science and technology debates, and I welcome the ready interest of the new President of the Board of Trade in coming to speak to the House so soon. We must firmly establish the ground rules within which science policy will be conducted, and it was useful to have the right hon. Gentleman's outline.

My hon. Friend the Member for Leeds, West (Mr. Battle) gave a powerful critique of our misgivings about the Government's level and direction of science policy. My hon. Friend is a diligent visitor to every kind of scientific establishment in the private and public sectors and is well respected by the research community as an observer of the field of science. He speaks with real authority of feeling in the science community, and that was reflected in his speech.

I welcome the appointment of my right hon. Friend the Member for Derby, South (Mrs. Beckett) as the shadow Secretary of State for Trade and Industry. She is a metallurgist with a strong scientific background and a lifelong interest in science policy. I have worked with her for many years in that area. While the Office of Science and Technology remains within the DTI, she will be a powerful advocate for science and a vigorous defender of the science base.

The fault that we perceive in the transfer of the OST to the DTI is not the wish for a more effective application of technology in industry, but the narrowness and naivety of the Government's view of the innovation process that lies behind the move. The science base must be safeguarded and the science budget ring-fenced to protect it against the mismanagement of the DTI's research resources that we have seen over the past 10 years.

It is about the narrower issue of increasing the competitiveness of industry in Britain that I am most concerned. In a way, the science base can look after itself. Scientists will be robust street fighters in the defence of the science base during the short time before the next election. However, industry cannot wait. I have sufficient confidence that scientists will fight their corner, but our manufacturing industry is not sufficiently competitive to be able to afford any delay. We are not able simultaneously to achieve sustainable balances of payments and public borrowing with low levels of inflation and unemployment. Britain is not unique in that among European countries.

We must be realistic about what we face. I want to refer to my constituency which, as the President of the Board of Trade knows, is an important part of industrial Scotland—for which, as Secretary of State for Scotland, he was responsible for many years. Scotland's steel industry wrapped up during his tenure of office, but 20 years ago it was the mainstay of employment in my constituency. Steelmaking finally ceased with the closure of Ravenscraig. Today, the best orders coming to our one remaining steel plate mill in Dalzell works have come from the shipyards not of the Clyde, but of Korea. The first major manufacturer to come into Lanarkshire after the rundown of steel promises to be Chung Hwa Tubes from Taiwan, which makes television picture tubes.

Electronics manufacturers in Scotland's central belt compete with the south-east Asian tigers—Taiwan, Korea, Singapore and Hong Kong—in the manufacture of components and they assemble their components in competition with the lower-cost assemblers in Malaysia, Indonesia, India and China. Those are only straws in the wind, but my constituents do not talk about putting up barriers against trade with low-cost labour areas. They are ready to recognise our common global interests in development and in rising standards across the world. However, they have little grounds for confidence in the innovative capacity of British industry and its research and development.

We face a highly dynamic situation. Hong Kong is running down its manufacturing even faster than Britain as its factories move into China, and those within China move further inland from the coastal provinces. The universities in the tiger countries of south-east Asia turn out a higher proportion of the age group as graduates than Britain does. Also, their postgraduate research is building up faster than anyone expected five years ago. I accept that Britain excels in some areas such as pharmaceuticals and molecular biology, which the President of the Board of Trade mentioned. There is no major pharmaceutical industry research laboratory in south-east Asia, not even in Japan.

A very important research paper was published in Nature this week by Dr. Craig Venter. He is the chairman and chief executive of the Institute for Genomic Research in Maryland. The Select Committee recently paid an interesting visit to that institute in the course of producing its report on human genetics. We had a most informative discussion with Craig Venter and his colleagues in Human Genome Sciences and with SmithKline Beecham about the patenting topics, among others, that were mentioned earlier.

When walking around that research institute, it was interesting to observe the number of Asians working on the bench. When the research paper was published, I checked on its authors and found that 15 of the 85 authors listed in this first human genome directory have Chinese names. The large and capable body of western-trained Chinese researchers who have contributed so much to the development of electronics now exists in most areas of science, ready to transfer their scientific and technological skills to applications in south-east Asia. Furthermore, it creates an attractive and exciting environment for western scientists. At the City university in Hong Kong, which I visited last week, I was fascinated to meet an old friend, an American mathematician called Steve Smale. He is a Fields medal winner, which is equivalent to being a Nobel prize winner, and one of the dozen leading mathematicians in the world. He now occupies a distinguished professor's chair in this former polytechnic in Hong Kong. Which British ex-polytechnic has the resources to attract a leading world scientist of that calibre?

There is an immense global task in building up the physical and institutional infrastructure in the developing world. We used to think of that as a humanitarian concern—and so it is. That task is now being tackled with immense vigour and success, with participation by western firms—but with the main effort and resources coming from within the developing regions. I find it an exhilarating and challenging prospect. We share a common humanity, common skills and common potential. There is no reason to believe that in the not-so-long term we have any greater advantages or disadvantages than people in any other country. Likewise, we know that if we put less effort into education, research and other forms of investment, we will suffer the consequent disadvantages.

We also know that if we think that we can hang on to positions and privileges that we enjoyed in the past, but do not earn today, we will suffer great frustrations. While an economy is catching up it can learn new technologies from others, but in due course it will have to develop its share of new technologies and contribute its share of basic research if its industry is to comprehend and use the facilities of a highly technological world.

We can take pride in the past achievements of British science, but we would be foolish to abandon what has provided the strengths of that tradition just as other countries are learning to use them. "Japan opens new era in university funding" was the headline for an article in Nature only last week. It described a pattern of university research funding very similar to that which existed in this country before the Conservative Government took office. I urge hon. Members to visit the science and engineering laboratories of the six universities in Hong Kong—as I have done—to see how, under the leadership of a former Conservative Minister, Chris Patten, now Hong Kong's Governor, that laggard among the tigers is catching up in its research and development expenditure. Hong Kong has the greatest potential of them all, as a gateway to China.

As a clue to tracking down the root of our own particular problems, it is instructive to compare the reports of the Bank of England and the Singapore authorities on the collapse of Barings and to ask which report was the more competent and more honest. When it comes to the sophistication, say, of the financial derivatives market, ask why the Isaac Newton Institute in Cambridge, which draws on and reports to the world mathematical community, was able recently to mount so very much more powerful a workshop than could be mounted by any British bank or financial institution on the technical structure of the derivatives market.

As for human genetics and its impact on insurance markets, the dialogue that was opened up by the Select Committee on Science and Technology is being pursued by the Royal Society and Institute of Actuaries, with one of the organisers of their dialogue being Roy Anderson, the research collaborator of Bob May, who is now the Government's chief scientific adviser. That collaboration between the Royal Society and. the Institute of Actuaries preceded the appointment of Bob May as chief scientific adviser and therefore does not reflect any element of Government initiative in this very important field.

We have an industry, an economy, running at half cock, with the clutch slipping between the intellectual powerhouse and the practical conduct of business. It is not a linear process, from research through application to production, but rather a network of processes, in business, education, research, each of which needs to be intellectually informed and linked to others.

Market mechanisms have a role to play, and all credit to the Government in bringing that to the fore during their period of office, but market mechanisms are not the intellectual network that is needed. They may be the letters of the alphabet, but they are not the language. We have to learn again the language of innovation and discovery. Somewhere in this language, a coherent science policy needs to be presented, and the lines of it are fairly straightforward. There is a high rate of return from research and development, but wherever it is carried out, there is great difficulty for the researchers—whether it be in a firm, university, research institute or Government laboratory—in appropriating sufficient benefits from that research to cover its cost. There are big spillovers in the benefits of research to other people in other institutions, firms and industries, indeed other economies. In the United Kingdom, there is a disproportionately low level of industry-funded research and development.

To address the problem of spillovers and the difficulty of appropriation, the obvious device in a market situation is to institute research and development tax credits. We accepted that argument before the previous election. I shall be interested to see whether it becomes Labour party policy for the next. I hope that it does. Evidence is accumulating in every other industrial country—we analysed it in our report in the Select Committee last year—on the route through which the science base is applied in industry. We established that there is a high cost in lost revenues, but the increase in research and development from recent work appears to be greater than the cost in lost resources, so in fact it is a more efficient way of supporting research than direct grants.

The correct measure is not the cost of tax revenues forgone but the increase in net output from the economy that results from the increase in research which is stimulated. This proper measure can be looked at by putting together the evidence from different areas of research, as we did in that report. It does, of course, need a supporting framework such as that put forward in the Faraday Institute proposals, which were adopted by both parties before the previous election, but which have disappeared from the scene since. It needs a supply of well-trained researchers coming from the science base to industry.

That has broadly been the framework of Labour policies that we have argued over the past decade. The evidence is there. We ask the Government to re-examine it. Indeed, it will be examined in a fortnight's time at a conference that the Minister for Science and Technology will attend in Cambridge and at which he will speak. I hope that he will also be there to listen, because some of the leading researchers in this field will attend. I hope that the Government will learn from what they hear.

Against this background, one can see why Labour Members feel profoundly uneasy about sticking the Office of Science and Technology into the Department of Trade and Industry, because it appears to be a spokesman with a vested interest in manufacturing industry, whereas in fact the Office of Science and Technology needs to enter into the mainstream economic policy debate and to be in a position in government where it can do so. The DTI, particularly as it has been run down to such a state over the past 15 years, is simply not able to carry that weight in the discussion of economic policy in government. That is apart from the health and environmental issues, which are of such great importance.

Of the work that has been done by the Office of Science and Technology, the foresight exercise is fine. It has been well received. I hope that it will continue. Good luck to the foresight challenge. It needs to be genuinely additional new money. The evidence that we have been given by the Committee of Vice-Chancellors and Principals justifiably questions that. As for the scrutiny report, that is well buried. I hope that the letter that the President of the Board of Trade sent to the Chairman of the Select Committee really does represent that burial. In that letter, one sentence read:
"The Research Councils will be opening up their research grants when they are seeking to achieve specific research aims."
That is a very important qualification. Does that mean that the research councils are to seek, to invite, under the prior options process, other bodies to do the research only where the research councils are not acting in responsive mode to grant applications or where, according to the practice of the Medical Research Council, the MRC is not backing the individual scientist in building a research unit around him? It is a crazy idea to pick a leading scientist who is the authority in his field, who puts up a good programme of research, which only he is able to do, and then to go out to open tender for somebody else to do it. That is a lunatic undertaking. Does that sentence in the President of the Board of Trade's letter reveal that response mode research and backing the individual researcher will not be subjected to the prior options process?

On the prior options process, it has often been said that Government, and the research councils in particular, will consider proposals for the carrying out of research from organisations other than academic and academically related bodies. However, for the research councils it has always been a dead letter because it has not been carried out in the awarding of grants. I know of examples in which I would argue that research council money should go outside academia, but people have not been able to make their case because, in the machinery of the research council, there is not sufficiently high-powered peer group, judgment to establish that that is the right way to do it. Therefore, the problem is not in stating the principle of opening up different ways of doing research; it is in organising the process of peer review and administration so that genuinely the best person able to do the research is invited and enabled to do it.

From one point of view, modern industrial society and the democratic processes of politics that sustain it have been astonishingly successful. If we look at the world today, we see that there are more people, better fed and enjoying greater liberties than ever before in the history of mankind. A great deal of that success is due to the combination of science and technology and our political systems.

Anyone who has tried to build actual systems that really work, be it a robotic arm, a chemical plant, a global positioning satellite system or even a pay-as-you-earn income tax-raising system, knows how difficult it is to get systems to work. The fact is that the new systems that we build are built out of bits of systems that more or less work already, so the task of new system building is even more complex. Modern society achieves astonishing success which goes far beyond the capacity of any scientist in any laboratory to get systems to work.

Yet from another point of view, politics appears grossly incompetent in its handling of the world. Unemployment, the waste of resources, social frustrations, urban squalor, decay of communities, social injustices and fears for the environment are all very real and all have to be taken seriously. They are properly laid as failures at the door of politics and as challenges to science and technology.

The greatest failure of the Government's science policy is that it fails to see the contribution that science and technology have to make at the systemic level and their ability to give new vision and hope to the political process and the community at large. My advice to scientists is to get on with the tasks that they see need to be done. They should try to educate the Government, but meanwhile get on with the tasks.

11.32 am

It is a privilege to follow the characteristically thoughtful speech of the hon. Member for Motherwell, South (Dr. Bray). He paid a tribute to the hon. Member for Leeds, West (Mr. Battle), who opened the debate for the Opposition. The hon. Member for Leeds, West had a testing task in filling in today for the right hon. Member for Derby, South (Mrs. Beckett), whose absence we of course comprehend. I hope that the hon. Gentleman will understand if I say that we look forward to her presence in a future debate.

In welcoming the decision of my right hon. Friend the President of the Board of Trade to open the debate as an index of the importance that he attaches to the subject, I hope that my hon. Friend the Minister for Science and Technology will forgive me for churlishness—for I am much admiring of the qualities and personal experience that he brings to the job—if I say that the Government would have taken a further trick if a Minister from the Department for Education and Employment had also taken part in the debate.

I shall not dwell on the move of the Office of Science and Technology into the Department of Trade and Industry, for by their fruits shall ye know them, and the fruit jury is still out, but perceptions are important and scepticism could have been mildly disarmed if the Government had extended their response to the debate to more than one Department.

Of course, I know the internal argument against such multi-facetedness, but we have no hesitation in telling scientists that they must mount multi-disciplinary teams when, at least in the ancient universities, the undergraduate-based discrete nature of disciplines is working as usual. Business as usual is a poor guide in science.

My right hon. Friend the President of the Board of Trade and my hon. Friend on the Treasury Bench should take any emphasis in my remarks on universities not as misunderstanding what Her Majesty's Government are trying to do in their new emphases, but as a deliberate counter-balance to help ensure that we do not throw away our historic strengths in a fit of modernism, which is a proper philosophy for anyone speaking from the Conservative Benches.

I declare an interest as a member of the council of the university of London and a presentation fellow of King's college London. Present trends constitute two threats—in no particular order, but unfortunately reinforcing each other. The first is the retreat by the research councils from responsive mode work as a concomitant of the emphasis on relevance. The scale of the retreat over years is by a factor of five. I shall return shortly to its impact.

The second trend is the delegation by Her Majesty's Government of higher education funding decisions to the Higher Education Funding Council, which has an understandable enthusiasm for the formulaic. It is a commonplace that the latter is likely to raise average quality, but at a spectacular price in international salience. It is international salience that should be the keystone of the DTI's preoccupation with competitiveness.

As a quick index, only perhaps one university in 10 has the quality of reputation to attract scientists from abroad. It is ironic that the present research assessment process and the HEFC funding methodology which arises therefrom are prone to encourage a transfer market in major research figures which will reduce critical mass.

However, more serious is the weakening of infrastructure in the key institutions by the spreading of jam more thinly. The infrastructure is already vulnerable because neither Government Departments nor charities are prepared to contribute to overheads at a time when the cost of facilities has risen exponentially, despite the HEFC's financial memorandum, which says that the universities must secure full cost recovery.

I acknowledge that the cost of equipment can go both ways, but the imperative of multi-disciplinary work is profoundly expensive in facility terms. To take a simple example in the biomedical field, the health and safety implications of maintaining in large numbers in animal houses mice with characteristics which make it essential to keep them out of the community have a substantial cost consequence.

Those obligations are necessarily not shared by what I will neutrally call the very new universities; yet the spreading of the jam more thinly does not of itself yield what the DTI seeks. One has only to look at where in particular industry puts its money in the universities for research purposes to see why it is important that we sustain our ability to achieve international salience.

There is a hazard that a university which raises a quarter of a million pounds from industrial sources will earn brownie points in today's climate, but if that consists of 125 projects at £2,000 each, that way does not lie our international salvation. Present trends threaten grade drift across the nation and a reduction of the unit of resource in those internationally competitive institutions which have larger obligations and on which we nationally depend.

An example of the potential opportunity costs might be taken from the work of I. C. Park at Imperial college in my constituency. Its extraordinary work on scheduling, in which British Airways is a partner, has reduced the time for examining scenarios when a plane is unexpectedly taken out of service from a couple of hours to a minute and a half, with a dramatic shift from the admirable but impracticable to the immensely relevant. That would not have been possible but for the depth of prior academic work and the scale of the infrastructure needed.

Why does responsive mode work matter? Just as one cannot know which scientific disciplines are going to be considered critical and necessary in 10 years' time in terms of their relevance then, so one cannot predict what curiosity-driven science will throw up in wholly new products and industries.

We Back-Bench Members are no use to our colleagues in government if we do not produce examples, and especially examples with a DTI resonance. I encourage any hon. Member who has not yet done so to visit the Alexander Fleming museum in my constituency, and to see the tiny room in Paddington in which, in 1928, he was conducting work, driven by academic curiosity over a long period of patient and painstakingly acute observation, on the ability of one micro-organism to inhibit the growth of another.

The impact of the room is numinous. What happened later is history and owed much to others, but no one would have predicted in 1928 what would follow, either in terms of wealth creation or the effect on quality of life, and to do so would have been treated as irresponsible.

The university of Dundee falls some way outside my constituency, but the richness of the harvest that the Japanese have reaped in liquid crystals goes back to original work on amorphous properties in the electronic field at that university. I am, however, one of the Members of Parliament who represents IBM, and I remind the House of the first laser diode demonstrated in the early 1960s as the result of basic work at IBM laboratories on semiconductor junctions.

Once upon a time, lasers were solutions in search of a problem—I must quietly note that that is the opposite of today's credo. Today, laser-generated communications through optical fibres are superseding electronic communication. Modern versions of diode lasers are the light sources driving a multi-billion dollar activity on the international super-highway, yet they derive from some rather fundamental physics.

To tell a similar story the other way round, the polymer industry, including my constituents at BP, is rushing to commercialise polypropylene made using a new chemical process involving metallocene catalysts. The original work to discover the structure of the catalysts was done by my constituent and Nobel laureate Sir Geoffrey Wilkinson as pure curiosity-driven research in the 1950s. I shall not take the House through the subsequent 40 years of developments, except to remark that the time scale is longer than that of a Department where the absence of a chief scientist has already been remarked on.

The right hon. Gentleman was a member of the Cabinet and, indeed, a helpful Minister with responsibility for higher education. Has he any personal view on the absence of a chief scientist, which has already been mentioned this morning?

I think that the way in which I phrased my remark might be interpreted as expressing a view.

The first engineer to win a Nobel prize, Dennis Gabor of Imperial college, won it for highly academic work on optics, which led to the discovery of holograms. Their ability to project a three-dimensional image from a flat surface has a host of recreational and industrial applications, but they are most familiarly found as a security device on credit cards that are household names.

Finally, I cite magnetic resonance imaging. Nuclear magnetic resonance is a piece of fundamental physics that has long been a research tool of physicists and chemists. Mansfield in the United Kingdom and Purcell in the United States of America pointed out that it could be used to generate an internal map of a solid object. Many refinements later, we have, in the magnetic resonance scanner, a multi-million pound industry and a sine qua non in any major hospital.

None of those examples arose as a result of a specific problem being set. I do not for a moment decry the work of the foresight panels, and I join in the admiration for the quality of the scientists who participated, although their effectiveness may be being blunted in the implementation, as administrators take over from scientists. I simply want to point out that outsiders and foreigners might take the view that the pendulum has swung too far against the responsive mode.

The literature that the Conservative research department thoughtfully provided to Conservative Members draws attention to the number of British Nobel prize winners in the 50 years between 1940 and 1990. It might have been more intellectually honest, however, if it had broken the half century into two periods of 25 years.

To remain momentarily abroad, we should be grateful for the fact that European Union research projects enable British scientists to remain involved in fields that we might not perhaps be centrally maintaining in this country. It would be a matter of profound reassurance, however, if my hon. Friend the Minister could confirm in his reply that the Treasury's practice of docking Departments for money contributed to such research in EU programmes will not apply to the OST under the principle of attribution.

I have apologised to my hon. Friend the Minister, as a long-standing constituency engagement may cause me to miss his reply. I close on the subject of technology with one apprehension that is central to his Department's activities.

In the current world, I do not fear for large companies, which have both the size and the exposure to international competition that are likely to ensure that they attend to the opportunities of science and technology. I do not fear for the small companies. Not only are a large number of our brightest young people going into the smallest companies, but such companies have had a reputation in the past 20 years for generating employment, which will itself ensure that they receive the Government's continuing scrutiny.

My concern is the middle-sized company that may employ about 1,000 people, but often does not employ one single person who is wholly literate in science and/or technology. Scientists may be entitled to take a Darwinian view of that condition. I suspect that Ministers and we Members of Parliament who represent the employees of those companies might not be able to take so sanguine a perspective. I have no obvious solution, and Darwin might well play a part in the outcome.

I salute the Government for making this debate possible. For a non-scientist, it has been a privilege to participate.

11.46 am

We have heard some thoughtful speeches, and the last two have been a credit to the occasion.

First, I welcome the President of the Board of Trade and the Minister to their relatively new responsibilities, and wish them well in their task of persuading their colleagues that investment in science, engineering and technological research is fundamental to the well-being of our country. I hope that they do not have too much of an uphill task. Incidentally, I see that the right hon. Gentleman has taken the advice of the hon. Member for Leeds, West (Mr. Battle), and beetled off to Dorneywood to protect the science budget from the Chancellor's axe.

I am sorry that the right hon. Member for Wirral, West (Mr. Hunt) no longer has responsibility in the Cabinet for science. The former Chancellor of the Duchy of Lancaster tried to support the science base. In his introduction to the 1995 "forward look", which was published earlier this year, he wrote:
"I see it as my overriding function as Cabinet Minister for Science to seek to ensure that the United Kingdom sustains and enhances its SET base. I have the highest admiration for UK scientists, engineers and technologists, in both the public and private sectors, and for the excellent work they carry out. I want to work with them."
We all agree with that.

What a pity that, in the summer reshuffle, the science community certainly saw itself as relegated from Cabinet status and subsumed in the Department of Trade and Industry, although I welcome the commitment of the President of the Board of Trade today to speak up for science in the Cabinet—perhaps in tandem with the Deputy Prime Minister. We will judge them by their actions.

It is also a pity that this debate has been tucked away on a Friday morning, when most hon. Members have returned to their constituencies or are about to do so. I suspect, however, that by putting it on a Friday we have been allowed more time than we would on another day.

The scientific community is rightly furious at what it sees as a demotion. The community is also none too pleased by the cuts in funding, which it sees as accompanied by a Government illusion that there is increasing funding of the science base.

Dr. Eric Voice of the Royal Society of Chemistry points out the effect of funding shortages on chemistry departments, many of which were built in the 1960s and are reaching the end of their useful lives. They need growing sums of money for vital refurbishment to provide our scientists with a modern environment in which to work.

Those needs range from providing enough fume cupboards, as mentioned by the hon. Member for Leeds, West, for routine daily use to a serious shortfall in the state-of-the-art equipment normally found elsewhere, such as nuclear magnetic resonance—NMR—imaging machines. Many British professors come back green with envy from visiting universities in the United States or Germany. We need to match the investment of those countries to give our scientists, engineers and technologists the chance to compete. All the evidence seems to confirm that Britain is falling behind.

The right hon. Member for City of London and Westminster, South (Mr. Brooke) mentioned Nobel prizes for science. Britain has a truly amazing record, but the trend is in the wrong direction. Between 1946 and 1955, British scientists won 10 Nobel prizes; in the next decade, 11; and in the following decade, 12. Between 1976 and 1985, they won only eight, and in the decade from 1986 to 1995, only one—although the peace prize award for a scientist may put the number up to two. The President of the Board of Trade said that we were top of the class; we may not be any more, but we ought to be.

Health and safety legislation for research establishments is greatly affecting research—the more so with chemistry departments. A large majority of 1960s chemistry department buildings are now unsatisfactory under current Health and Safety Executive rules, with which it costs money to comply. It is not unknown for the HSE to order the immediate closing down of an activity being run with the only equipment available to that department.

Equipment spending levels in real terms per full-time academic have nose-dived over the past decade, especially in the past six years, from £1,850 per academic in 1987–88 to £1,193 in 1992–93—a drop of well over a third in six years.

The hon. Member for Leeds, West, to whom I always listen, spoke forcefully and clearly about cuts in Government support for science. I hope that the Minister will tell us what he intends to do to turn around Government's attitude to funding science and technology.

I shall deal next with the effects of good scientific and technological developments on our quality of life. There is a problem in projecting science into the community so that the community understands the benefits that past scientific research brings to life today. It is the role of hon. Members, inside and outside the House, to make the public aware of what is going on and of the importance of scientific investment. The House will know of and appreciate the huge improvements that medical research has brought to mankind. We know of life-saving breakthroughs by our scientists and by those of other countries.

I have a personal reason to be grateful to recent medical science. My twin daughters were born 10 weeks prematurely in 1986; had they been born 20 years earlier, they would probably not have survived, because their lungs were not sufficiently developed. Today, thanks to past medical research, and to the skill of doctors and nurses, they are as healthy and, I have to admit, as noisy, as any other children.

There are huge developments in information technology, an industry in which I spent more than 20 years before entering the House. There is much comment—some of it exciting, much of it hype and plenty of it ill informed—about the coming information revolution which is being brought about in part by the British invention of fibre-optics and its use in the transmission of data. The so-called information super-highway has sparked interest in the most unusual places.

My hon. and learned Friend—and office colleague—the Member for Fife, North-East (Mr. Campbell) describes a meeting between my right hon. Friend the Member for Yeovil (Mr. Ashdown) and Al Gore, the Vice-President of the United States. For the first 20 minutes, they talked about defence and foreign affairs. My hon. and learned Friend described it as "straight bat stuff'. Then my right hon. Friend mentioned the super-highway, and the Vice-President sprang to life. For the next hour, his brow furrowed with bewilderment, he was treated to
"Ashdown and Gore rising above us on a cloud of cyberspeak."
To be fair, he now has a laptop of his own.

Like it or not, the information revolution is coming. Its impact will be as dramatic as the invention of the pencil. The merging of broadcasting and computing technologies in the digital age offers mankind opportunities—and dangers—to change the way we live. Its impact cannot be ignored. I know that the Minister is appearing at the European conference on cable communications on Monday, and I will be pleased to be there to listen to what he has to say.

Today, only a small, although growing, number of people use the Internet. The hon. Member for Leeds, West said that there were 30 million worldwide. They use it to communicate their message to individuals or to the wider public. At the last count, 99.5 per cent. of the population were not using it; the nearest they get to it is watching "Tomorrow's World" on television—an excellent programme—or seeing hieroglyphics on their television screens next to the telephone number or contact address for giving their views on the topic of the day.

The Government have washed their hands of part of the issue. They prefer to let market forces dictate the way forward, yet it is a curiously distorted market. The Government ban on British Telecom broadcasting live entertainment is equivalent to shooting Linford Christie in the foot at the start of the 100 metres. If we have a world beater, we should encourage it, not discourage it. Both the cable companies and BT are of key importance in installing the infrastructure for the information super-highway, which needs further development by our science community. There needs to be a national plan to ensure that anyone who wants access can have it.

The hon. Gentleman makes a specific point with which I may not have time to deal in my winding-up speech. If he read my letter in the Financial Times on Tuesday of last week, he would see a succinct description of Government policy.

The hon. Gentleman must remember that it would not be possible to invest in the cable industry if there had not been asymmetrical regulation in favour of market entry. That is the key point. The ultimate beneficiary is the consumer. That must be never be forgotten. The quality of services being introduced is due to the fact that BT is subject to competition, and its reputation abroad exists partly because it has a competitive home market from which to develop its services.

I thank the Minister for clarifying that. I do not agree with him, because, in my discussions with BT, I was told that it believes that the ban has affected its export opportunities that it could have gained had it been able to demonstrate a home market. It was able to demonstrate that it had the technology for installation. The case mentioned to me involved east Germany. The Minister and I will continue to debate that issue.

There needs to be a national plan to ensure that everyone who wants it can have access to the information super-highway. It is not enough to cherry-pick areas of high population density—the towns and cities—where the costs of cable installation are lower. We must ensure that the fruits of this scientific breakthrough are available to all our people, including those who live in rural areas such as rural Gloucestershire, Cornwall, Devon and Warwickshire. Those areas are all what I call Charles Kennedy territory. Those people are as much part of the future as anyone else.

We have heard already that fibre-optic technology was invented in Britain. How fitting it would be if Britain became the first complete super-highway nation.

Some scientists will go into detail and claim that microwave technology should fit into the overall plan, and I do not argue with that. What I want is a plan rather than no plan at all; otherwise, I fear that we shall create a new category of poverty—the information have-nots, who are excluded from the services that businesses, local and central Government, and health authorities will provide in the future.

At the moment, the human race is scratching at the surface of what could be achieved using the information super-highway. There is far more to it than delivering 37 entertainment channels, although I know people who sit all day flicking through them until they find repeats of "Neighbours", "Dallas" or "I love Lucy". The super-highway—the result of a British invention—will have a profound effect on how we work and live. With the digital age, computing and broadcasting technologies are merging into one.

This is a great opportunity for Britain, because British software scientists are among the best, if not the best, in the world, and our broadcasters have a reputation for excellence worldwide. Putting the two together in the new information revolution places Britain in a unique position to create wealth and influence events in the exciting new age of multi-media services, reaching across national boundaries and around the world.

Let us be clear—the Internet of today is not the super-highway of tomorrow. The super-highway as envisaged by Al Gore and my right hon. Friend the leader of the Liberal Democrat party is a broad-band system that allows high-definition pictures as well as text to travel from any point on the super-highway to any other point.

Businesses will use the technology to promote their products; holiday companies will offer a "See before you fly" service; and estate agents will give a multi-media conducted tour of your home of tomorrow from the comfort of the armchair in your home of today. Inevitably, a colleague will call and download the document or the three-dimensional image of the building design on which one is working, or the inevitable press release, so that one can make those last-minute adjustments.

There is also evidence that companies will locate and create jobs where they have access to the best information, as well as transport infrastructure. Soon, access to local and central Government services will be available in the home. One will be able to fill in a tax return on a Sunday afternoon when the football is a bit boring, find one's way through the benefits maze—if any benefits remain by then—or even send a stroppy letter to one's local Member of Parliament who voted the wrong way on an issue about which one feels strongly.

The Government have a responsibility to enable everyone who wants the skills to use the new technology. If a 10-year-old child of today does not have the skills to use the information super-highway by the time he or she is looking for a job, he or she will probably not be able to get a worthwhile job. So the Government have a responsibility to ensure that the infrastructure extends nationwide, which means ensuring that there is no financial barrier to gaining those skills.

That means that people in schools, colleges, universities, libraries, and village halls and people at home must be able to gain access. By upgrading the skills level of everyone in Britain, we can become a decent, tolerant and prosperous nation once again. If we do not do it, I guarantee that some other country will.

I welcome the Government's continuing recognition that we need to attract more women, not just into science but to stay in science once they have completed their PhD, because women have just as much to offer as men and our nation should make use of all our academic talent. Women are a vital part of our future.

I hope that, when the Minister and the President of the Board of Trade get together before next month's Budget, they will press the Chancellor to ensure that the science community is properly funded in future. If we do not invest heavily in our science base, the future will not be much to look forward to.

12.3 pm

May I join in the welcome to my right hon. Friend the Member for Galloway and Upper Nithsdale (Mr. Lang), the new President of the Board of Trade, on his first appearance at the Dispatch Box in his new capacity? I also welcome my hon. Friend the Minister for Science and Technology, whom we have already recognised as someone with a considerable grasp of the issues involved in science and technology. He has been extremely active throughout the country in support of those central themes in our economic development.

The activities within the Office of Science and Technology have been considerable over an incredibly short time. I listened with declining attention to the hon. Member for Leeds, West (Mr. Battle) as he approached his 47th minute, but I heard him conclude with what I can only regard as a remarkably backward-looking commitment to old Labour when he said that Labour would establish an advisory council at national level, local science shops and a co-ordinated strategy. Shades of good old George Brown were entering into the discussion at a most relevant point and I am glad to see that the great mark that he will make on the future starts in the past.

I contrast that with the fact that, in 1992, the Government took what were probably the three most fundamental steps in shifting the way in which science was handled, not just in previous Administrations of this party but in Administrations previous to that. The fact that the OST came into being; the fact that it was located in the Cabinet Office; the fact that it had a Minister at Cabinet rank to promote policies that might co-ordinate the Government's activity in science; and the fact that within its remit it quickly published in "Realising our Potential" a blueprint for scientific effort, both through research councils given new mandates and competition, and through the way in which industrial development could be fashioned through "foresight" and "forward look", were all considerable initiatives. We are not yet three years down the road since the establishment of that "new template" for British science and technology.

It is, at least in part, a shockwave reaction to the fact that that relatively new but hugely promising plant should be transplanted that has caused a ruction among the scientific establishment and hon. Members, which we have witnessed this afternoon. The meaning behind that seems to be that, despite initial anxieties, the OST in its original form and location had already gained considerable commitment and had started to provide evidence that it would take a grip on the future for science and technology in a way that had not been seen in a decade or two. From that point of view, it is a reaction based on success.

Although I have not felt great anxiety about that, I understand why others have such anxiety and feel that I should make some observations to my hon. Friend the Minister, to which he may care to respond. It is odd that, despite the technique of ring-fencing a budget—whether "ring" is the "Colgate ring of confidence" or merely a form of garotte, I do not know—it is insufficient to make it clear that the science budget will have a separate and determined level of expenditure committed on a one-to-one basis between the OST and the Treasury. I am happy with my right hon. Friend the Chancellor of the Duchy being the protagonist, as he has admirable clout to deal with that matter, but I am a little anxious that ring-fencing is not enough.

Let me make two suggestions that might help. First, it seems odd that there is no chief scientific adviser within the DTI. Without such a post, it seems likely that the role of the splendid "chief scientific adviser (total Government)" is at risk of being diluted or involved in a special pleading relationship between the CSA, who is physically located elsewhere but whose responsibility within the OST would inevitably involve him with the Department of Trade and Industry, including officials, and the President of the Board of Trade and Industry himself. I am a little concerned that such influence may not be beneficial to the doctrine of separateness which I believe to be an important, if not crucial, aspect of the OST's credibility.

I am not encouraging a U-turn when I invite my hon. Friend the Minister or the President of the Board of Trade to consider reviewing whether the Department of Trade and Industry should not have its own scientific adviser and thus be complete. Such a person would be part of a team working under the CSA to co-ordinate the Government's science policies and would be a separate voice for the DTI. The CSA would not be a surrogate for the DTI. I hope that that is a constructive suggestion.

The next stage of development has to prove itself on the back of the first. I give enormous credit to my right hon. Friend the Member for Bristol, West (Mr. Waldegrave) who, in his previous incarnation as Chancellor of the Duchy of Lancaster, inaugurated a very productive period for science and technology. The Science and Technology Select Committee owes its existence to the OST. When the OST was transplanted to the Department of Trade and Industry, there was considerable doubt as to whether it would continue. I am delighted that the President of the Board of Trade made it clear beyond doubt today, and in public for the first time, that the current position is to be maintained and that the Committee will continue to monitor the Department and operate researches of its own choosing. I look forward to a future, reassured on behalf of the Committee.

Today's debate may be due to the Committee. It was, after all, in our response to "forward look" that we advised the Government that there should be an annual debate on science and technology shortly after the publication of the yearly appraisal. In parliamentary terms, it is broadly within two months that we are having it, if one puts the recess on one side. I welcome that as a response to our initiative.

The Government's response to our little report on the efficiency of our research institutions was a little unorthodox. I accept that the two-month period was not quite up. It was generously extended a little and we then received a letter from my right hon. Friend the President of the Board of Trade. I covet a letter from him at any time, and the fact that he put a stamp on it was of immense importance. It was signed by him, I enjoyed reading it and I am deeply grateful to him. I understand, of course, that Pauline epistles are rare—not many responses did St. Paul receive in his day. In any event, I am delighted that we had one from the President of the Board of Trade.

I am not certain, however, that the Government's response was quite the correct one to a Committee's report that justifies debate on the Floor of the House. I am glad, however, that it is tagged for consideration today. I suspect that the Government's anxiety about the efficiency of the scrutiny of the research establishments is a matter of modest embarrassment, in which case I perfectly understand the way in which the report has been handled. It should not, however, be regarded as the way to respond to our Committee's reports.

I cannot resist the temptation to express my relief that at least the DTI's letters have stamps on them, even during the recess. I assure my hon. Friend the Chairman of the Committee that there was no attempt to downgrade the importance of the response, which was published as a Command Paper. The timing was partly due to the fact that we realised that a great deal of uncertainty needed to be dealt with. I have, however, listened carefully to my hon. Friend's strictures.

I am grateful to my hon. Friend for his generous remarks. I now move on to weightier matters. The debate is much advanced and I shall omit some of what I was going to say. I leave the OST as an office which will help to generate new scientific endeavours.

My Committee hopes to examine the research councils and their activities. The first to be selected by the Committee is the Particle Physics and Astronomy Research Council and CERN. We hope to begin work shortly. We regard it as part of our remit to examine all the research councils and how they have responded to and dealt with the various requirements placed on them. We have only recently concluded a major consideration of human genetics and its consequences. I am glad to hear that the Government will respond to that shortly. I put down a marker to the effect that the report, which, in my humble estimation, is very significant, involves trans-departmental response. I think that all members of the Committee will share my hope that any response to the report must involve other Departments which have a hand in dealing with its findings. When the Government have issued their response, I believe that the issues involved would justify a full-scale debate that should not be tucked away on a Friday. It should perhaps be given proper Government time so that we can deal with the fundamental issues, such as developments in scientific and medical research and the way in which genetics will affect public policy. I hope that that suggestion has also been noted by the Whip on duty. The Committee continues to provide commentary on developments in the scientific and technological world.

The emphasis in the speeches made by all hon. Members is the position of the United Kingdom and its scientific and technical expertise. There is no quick solution for making it more fecund than it has been. It is partly a matter of genuine leadership by the Government of the day and partly a matter of the huge efforts made by academics in universities great and small, new and old, to try to generate the excitement of discovery and ensure those minds suitable to become researchers and academic scientists are encouraged to do so. Outside of that, however, is the economy.

It is tragic that people who are qualified in various branches of the distinguished science of engineering find it impossible to get jobs with companies that can benefit from the skills that they can provide. Equally, many academic researchers may find many prospects for industrial improvement to their work. My background is not in science, as my long-suffering Committee members are aware, but in industry and I am sorry to mention it but many people believe that it is only right to bring the activities of universities that have industrial application closer to the industrial market.

I shall not take long, but I am grateful to my hon. Friend for giving way because I wanted him to consider including in his list of institutions and people who are vital to science in this country those who work in science education in schools.

That I now do with willingness, and proceed on my way.

The importance of bringing those extremes of learning and commitment closer together must be right in so far as our economic activity goes, but this I do understand: that far too often, in the industrial context, either companies are unwilling to invest long term in research that is related deliberately to their own activity, or they are under pressures from Governments, lack of economic activity, pressures of taxation or perhaps the pressures of shareholders not to devote the correct proportion of long-term research money to the type of projects that will bring long-term benefit to their own companies.

That instance of short-termism—of companies not carrying with them, in their plans for research and development, shareholders' representatives such as the big institutions that nearly always hold all the shares in the major companies—is a clear fault in the links in the economic chain. It does not occur in other markets such as the United States, France or Germany. There are significant problems in that arena.

Science is about wealth creation, and most people would say that it was primarily about wealth creation. The OST needs to retain its departmental role so that it can ensure that our science has wealth creation properties. It is right that the priorities for science through "forward look" and through "foresight" be refined, and that our national effort—in pharmaceuticals, defence or medicine—should be refined for the betterment of our people from now for generations to come. In that endeavour, I welcome the OST as at least one of the godfathers of the national enterprise.

12.22 pm

Well, well, well, Mr. Deputy Speaker. That was a coded speech if ever we heard one. For the past 43 years I have listened on and off, with pleasure and amusement, to the hon. Member for Pudsey (Sir G. Shaw), and he will correct me if I decode his speech thus: it was crazy ever to get rid of the OST; it was done for short-term political reasons; now that it is done, I shall not complain too much, but why, in heaven's name, do they not have a chief scientist? [Interruption.] Because the hon. Gentleman laughs like that, I shall leave the subject, but that is a fairly succinct translation and decoding of exactly what he said. Everyone in the House knows that that is precisely the serious question that I asked the right hon. Member for City of London and Westminster, South (Mr. Brooke). I asked him whether, in those circumstances, there might be some explanation of the reason why a chief scientist has not been appointed.

I shall concentrate on one topic—academic research careers for graduate scientists. Like many of my parliamentary colleagues who have visited science departments this year, I am uncomfortable, to the point of being distressed and dismayed, talking to post-doctoral researchers. From their mid-20s to their mid-30s, they tell me often that they see no glimmer of hope of obtaining a permanent post in the academic world.

I asked the Minister to deny, if he really means it, the proposition that research in Britain is now in large part conducted by young, hopeful postgraduates who are prepared to work for proverbial peanuts. That is not going over the top. They work for very small remuneration, on contracts lasting on average, for heaven's sake, less than two years. I am afraid that that is the reality in 1995.

That is the reason why I intervened on the speech of the President of the Board of Trade on the issue of short-termism and those contracts, followed up by my hon. Friend the Member for Cambridge (Mrs. Campbell). The Minister must say something about that.

What funds are available for improved career management? Industrialists tell us that even newly qualified PhDs are too specialised. If that is so, it is ridiculous to wait until young men and women are already on the post-doctoral treadmill before providing training to help them obtain a job outside universities. Is there not a serious case for financing a new layer of long-term research posts and projects?

It is 33 years since, as a new Member of the House of Commons, I was invited by James Cattermole to go to the university of Nottingham to speak about Labour party science policy. I still do not forget a man from the back of the hall rising to ask the second question and stringing together the five most awkward probing questions that it was possible to devise about Harold Wilson's white heat of the technological revolution. I floundered as best I could, sat down perspiring and asked the chairman, "Who in heaven's name asked me that?"

Mrs. Cattermole was the chairman—she was the wife of the Labour party eastern region organiser, whom my hon. Friend the Member for Leeds, West (Mr. Battle) will well remember. She said, "Don't you know that is Fred Dainton, our new vice-chancellor?" It turned out to be the beginning of a third of a century's friendship so, when the now Lord Dainton describes contract researchers as an "underclass"—that was his word—I am very worried.

The report of the House of Lords Select Committee on Science and Technology, which Lord Dainton chaired—"Academic Careers for Graduate Scientists"—cites examples of people who have now retired without ever having secured a permanent position. That often represents a human tragedy. Lord Dainton says:
"We will pay a price for it. Able young people will go elsewhere."
The Select Committee discovered that, between 1980 and 1995—that is where my intervention on the opening speech came from—there had been a 217 per cent. increase in contract research staff. The number of permanent research and teaching staff had grown by 2 per cent. and the number of technicians had dropped by 14 per cent. Do the Government accept those figures? If they do, how on earth can such a position be right?

Young scientists are complaining that they are being treated as hired hands, there to do the donkey work, while established academics reap career benefits. The more skilled and experienced they become, the more likely they are to be shed for cheaper replacements. When scientists reach the age of 30, authorities and employers can start thinking that they are too old and becoming expensive. That is short-termism at its worst.

According to a Chemical Industries Association survey, a postgraduate degree in chemistry does not help someone to land a job in the chemicals industry and, in some cases, it may even damage a person's chances. Unless a candidate's PhD relates specifically to the job in question, most companies say that they would rather take on someone with simply a first degree—the greater age, inflexibility and higher salary expectations all work against the postdocs.

Some 35 per cent. of the 54 firms that responded to the survey had recruited postdocs for positions traditionally filled by postgraduates; but the trend towards employing postdocs for positions traditionally given to single degree holders was not as strong as expected, given the large number of postdocs looking for jobs. One reason for that may be that employers are worried that the job market for postdocs will soon take off and they will not be able to hang on to them.

The Government must have some view of the work done by the Chemical Industries Association. The House of Commons had better face up to the fact that supposed—I repeat the word "supposed"—so-called efficiency gains have come at the expense of a generation of scientists. Added to that is the culture of continual assessment. It sounds very fine, but do we on these green Benches have any conception of the administrative burden that continual assessment puts on teachers?

The position worries vice-chancellors, who have contacted us all. They say:
"While general research funding from the HEFCs has not increased significantly, externally funded research in universities has risen in value by more than since 1989 from around £800 million to over £1,200 million.
Much of that work is carried out by contract research staff employed on fixed-term or similar contracts. The number of contract research staff doubled in the ten years between 1983/84 and 1993/94 to 20,000, or one quarter of all full-time university academic and research staff."
Does that worry the Government? There are limited opportunities for such staff to progress to established university-funded academic posts. The vice-chancellors continued:
"Valuable expertise and trained personnel will be lost, and talented young people will not be attracted in, if arrangements for their employment and career development are not improved."
That is the vice-chancellors' considered opinion. I know that they are working on a draft concordat with the OST and the Royal Society, but may we have some sign of the Government's attitude to that?

The Royal Society of Chemistry hopes that the President of the Board of Trade, who has just returned to the Chamber—I make no complaint about his absence—and the new Minister for Science and Technology will take the opportunity of today's debate to give the House the Government's response to the House of Lords report and, in particular, to say whether sufficient attention will be given to the supply and demand balance.

I did not pick up from the President's opening speech that there was to be any reply to the House of Lords report—he certainly did not mention that specifically and I do not think that he did so by implication. I hope that, when he winds up, the Minister will make some response to that massive report.

Lord Dainton said:
"If you do not know where you are going next, you become restless, you start looking around!"
The truth of the matter is that scientists are human like everyone else. When they have to worry about human considerations, such as how they will pay for bread, butter and mortgages, it stretches the imagination to suppose that good science can be done at the same time.

Like other hon. Members who have spoken in the debate, I shall be brief. I have browsed through the evidence that was given to the excellent House of Lords Select Committee on Science and Technology and I ask the Government to examine and reflect on one passage. At the Committee hearing in Edinburgh, in answer to a question from the Chairman, Lord Dainton, Professor Bruce Proudfoot said:
"We are not at all convinced that the system of temporary appointments at junior level necessarily produces the best science and that at the end of the day is what we are interested in. It may produce a lot of short-term work but it does not necessarily lead to good long-term research. I think that is a general comment which would be very widely supported amongst those with whom we discussed the problems"
. The Chairman then asked:
"Your colleagues agree with this?"
Professor Lane replied to that question. Lord Phillips of Ellesmere—whom some of us have known for a long time as David Phillips; we are delighted that he has entered the other place—then said:
"My Lord Chairman, perhaps I could intervene straightaway because this point worries me. It seems to me that the entry into academic research careers, certainly since the 1960s, has been an extremely competitive process. It is almost inevitable that it should be. If I say to you that many are called and few are chosen, you may recognise that quotation and think that it applies in this case. There does, in my view, need to be some sort of probationary apprentice system in order to select out those that are ultimately chosen. How would you do that?"
Professor Lane agreed with his comments, but I am interested in the Government's answer to Lord Phillips's very proper question—I describe it as "proper" because I do not necessarily endorse it. However, a legitimate question was asked and it deserves an answer. Page 33 of the Select Committee report states:
"To extend the length of courses is to enhance the cost of producing graduates and in science subjects is misconceived because it is in the nature of advance in understanding of a scientific subject that ever more comprehensive theories continually supersede earlier less comprehensive ideas. The implication is that the courses should not grow in length and that the student should be relieved of the burden of learning redundant notions. As the late Sir Peter Medawar succinctly wrote, 'we need no longer to record the fall of every apple'".
As was so often the case, Sir Peter Medawar was spot on and that question must be answered. It would be selfish for me to continue my speech. However, I ask the Government to comment on three of the Select Committee's recommendations, which appear on page 36 of its report. Recommendation No. 6.1 states:
"Contract staff should have the same status and rights as established colleagues of equivalent rank, including entitlement to participation, where appropriate, in university policy and decision making machinery and access to the same amenities and facilities as are available to established staff".
Recommendation No. 6.3 states:
"Universities should earmark funds to bridge gaps between contracts for contract staff."
Recommendation No. 6.8 says:
"Funding councils should increase their emphasis on industry/academia links when allocating grants to universities".
That is a source of on-going worry. Many talented young men and women are extremely, and increasingly, concerned about their futures and they should be treated properly. I hope that the Minister for Science and Technology will comment on that issue in his winding-up speech.

12.39 pm

I listened to the carefully coded speech by my hon. Friend the Member for Pudsey (Sir G. Shaw). I never give coded speeches. Let me make one or two observations that might be to the advantage of the House.

I made an analysis of Government expenditure on research and development, and I have the figures here. Total expenditure on civil research and development in 1995–96 at 1994–95 prices—that is, in real terms—is £3,057 million. When one compares expenditure for 1990–91 with that for 1995–96, it is true that the money to research councils and the OST has increased by £;252 million, but the money to higher education and funding councils has decreased by £67 million, that to Government Departments has reduced by £341 million, and that to the DTI has slumped by £143 million. They are significant figures, and I hope that the Minister will mention them in his reply to the debate.

Every year, we receive some indication of what Governments have done in this field. Achieving the quality of life that the nation deserves requires big expenditure on science, because it is almost as important as the air we breathe and the environment in which we work.

I was also impressed by the figures from the OECD report of 1993. The United Kingdom spends £21 billion, and France spends a similar amount—£26 billion—but Germany spends twice as much, Japan spends four times as much and the USA spends eight times as much as we do. One may say that those countries have larger populations, but we live in a competitive world, and whether our firms exist or perish will depend or our competitive position and the amount we spend on the seedcorn for tomorrow. We require an explanation of why we are not keeping up with our major competitors.

While I pay tribute to the work of the Minister, there is a long way to go. There is no painless way, in my judgment, of securing additional revenue, but one possibility is the national lottery. It is for wealth creation and the enhancement of the quality of life. I make the following recommendation to the Minister. I would extend the National Lottery etc. Act 1993 by amending section 22 to reduce the share of existing categories from 20 per cent. to 16.6 per cent. of allocated expenditure, and extending the categories to include science and technology, to strengthen the strategic scientific base.

When one considers the importance of science to the United Kingdom, not only in 1995 but in the ensuing years—and that is a vital factor—one cannot consider a better way to grant money from the public to fund not merely the equipment required in universities but the work that is being undertaken to get ahead and discover new lines.

I shall be brief, as other hon. Members wish to speak, but I should mention the transfer of the OST to the DTI. My arguments against that are as follows. The timing was premature. Given that the OST was formed only in 1993, to terminate it in 1995 because it has lost its autonomy is a great pity.

My right hon. Friend the President of the Board of Trade has given every indication of the OST's pertinence to the new Ministry, but there are indications of an opposite course. There is to be no new chief secretary for the OST, and, the ministerial and Cabinet Committee on science and technology having been abolished, science will come under another ministerial committee on competitiveness, under the Deputy Prime Minister. I envisage the OST being subject to complete absorption in future. If that happens, much of the money will have gone.

The Committee of Vice-Chancellors and Principals states that that policy signals a shift of science and technology in universities to a more applied and short-term emphasis. When the OST is to be responsible for not merely one branch of science but trade and industry, education, health, the environment, transport, defence and the wider interests of the community, how can it be expected—having been impaled by one Department—to stretch out and assume responsibilities for all the other Departments? My other anxiety is that the DTI's track record on research management has not been good, and there was ample evidence of that today.

Technology foresight has provided a useful dialogue between academia, Government and industry, but at some considerable cost. British Telecom says that it has had its own technology foresight process for more than five years. The National Economic Research Council has for a number of years undertaken its own periodic assessment of future priorities, resulting in the publication of its scientific strategy documents. Nuclear Electric states:
"The truthful answer is that Technology Foresight did not generate any new ideas in the field of energy, but why should we expect it to do so?"
But everybody praises the dialogue. Every modern country in the world has a similar arrangement.

Apart from all the window dressing, a great deal is done by companies—and they would be fools not to do it. The Government are not in a position to pick big winners—it could never be that—but it may help the Government to allocate resources. The trouble with Government allocations is that extraneous elements enter the calculations and financial stringency may blow them off course. Linking allocations with specific economic objectives may be injurious, and short-termism is an obvious drawback.

What areas would I choose for fund allocations? Fifteen panels have been established. I look first to defence and aerospace. After all, British Aerospace is the UK's No. 1 exporter, with no less than £5 billion of exports per year. Fourth and fifth are IBM UK and Rolls-Royce, which between them export £4.5 billion. I would look next to financial services operating in the single European market. The City of London is the key to that sector, and has been for centuries.

The third category is information technology and electronics. BT is one of the leading enterprises in the European Union, and there are a myriad of electronic companies in the UK. I would throw in biotechnology, which will sweep across agriculture, medicine and even life itself.

It would be rather interesting to find out what sort of job the Department is doing. A departmental press release says that £46.7 million has been awarded to 473 new research projects. They include Cardiff university for research to determine the time of death of human corpses; Leeds university for research to identify criminals from dandruff found at the scene of a crime; and Southampton university to discuss how to track the allergenic particles produced by house mites. Those are just a few of the 473 projects. Many of them are good, but is it really the way to allocate money?

My hon. Friend will be speaking shortly, so we will find out why he thinks that.

I am sure that we all agree that there are great difficulties with implementation. My right hon. Friend the President of the Board of Trade has seven Ministers, 11,000 civil servants and 70 press and publicity officers to suggest what courses should be followed. The publicity department's budget increased from £4 million in 1979 to £25 million in 1994. Information on services provided pours out of the DTI, but regrettably only about 6,000 in 100,000 firms use it. With the plethora of information available, we must decide how best we can digest it, assimilate it and turn it to real advantage. The mass of statistics on the information highways must not be discarded unanalysed.

Most valuable to the United Kingdom is our science infrastructure and basic science, and I am sure that all hon. Members want that to be extended. In view of the efforts made by our major competitors abroad, we might wonder how the UK has achieved the results it has thus far. We have some of the best and most mature scientists in the world, but we lose far too many of them to the United States and elsewhere. We must keep them here by providing incentives and more new money. I hope that when someone in the Department reads what I have said, many of my suggestions will be pursued.

12.53 pm

I want to begin by saying how pleased I am to see the hon. Member for Bedfordshire, North (Sir T. Skeet) in such good spirits and good voice after his recent hospital treatment. I am sure that all hon. Members are pleased about that. In view of the tenor of his speech, perhaps I should ask him whether he wishes to join the hon. Member for Stratford-on-Avon (Mr. Howarth) and cross to the Labour Benches—[Interruption.] Perhaps that might be going a little too far.

I declare two interests. First, I am a non-executive director of the Welding Institute in Cambridge. Secondly, my husband is the co-director of the Interdisciplinary Research Centre in Superconductivity in Cambridge. I intend to mention both those organisations in my speech, so I thought I should declare my interest.

Because of the way that business is announced in the House, two of my hon. Friends who wanted to attend today were prevented from doing so by constituency business. My hon. Friends the Members for Birmingham, Selly Oak (Dr. Jones) and for Ellesmere Port and Neston (Mr. Miller) would have liked to attend this debate, and are extremely sorry that they cannot do so.

The hon. Member for Bedfordshire, North clearly highlighted the declining budget for science and technology under the Government. I should like to underline some of the figures that came out of the "forward look". If we look at the budget in real terms, we see that, in 1986–87, the budget for science and technology within Government was £6.7 billion. By 1994–95, that had fallen to £5.9 billion. The really distressing part about it is that it is projected to fall even further by 1996–97, to £5.5 billion. What we are seeing under the Conservative Government is not a steady increase in funds, as we keep being told by Ministers, but a steady decline in the real money that is spent on science and technology.

We do not even do very well by international comparisons, and my hon. Friend the Member for Leeds, West (Mr. Battle) highlighted the amount that is spent by different countries. Let me just express that as a percentage of gross domestic product. In Germany, in 1993, it was 2.48 per cent. In France, it was 2.41 per cent. In Japan, it was 2.80 per cent. In the United States, it was 2.79 per cent. In the United Kingdom, it was a dismal 2.19 per cent.—well below our major international competitors.

Dr. John Parnaby, of the Institution of Electrical Engineers, pointed out in a very cogent speech that the real danger to us in the United Kingdom is our rivals in Asia, China and the former Soviet Union. Unless as a nation we start to invest more heavily in research and development, so that we can produce high-value-added products and processes, we shall be vulnerable to low-labour-cost countries.

My own leader expressed it extremely well in his very well received and excellent speech to the Labour party conference in Brighton, when he said that we cannot and will not compete as a low-wage, sweatshop economy. That cannot be part of our agenda. We have to encourage innovation by industrial research, and we have to ensure that industry successfully exploits the science base.

I am afraid that the picture is dismal. British firms are subject to endemic short-termism. I mentioned earlier, in my intervention on the President of the Board of Trade, that the research and development scoreboard in 1994—these are the Government's figures, not something that I have invented—indicated that the top 200 world companies are spending £104 billion on R and D and just under £40 billion on dividends.

When we look at the top 362 companies in the UK, we see that that is completely reversed, and that only £7 billion is spent on R and D and £14 billion on dividends, making quite clear the priorities of our companies when it comes to spending money. It just will not do. City analysts are dictating the investment policy. The main concern in the boardroom is to get the earnings per share right and to ensure that the three-monthly financials are okay. But what that does is force firms to cut research and development and training, and not protect the future.

One can hire 20 Vietnamese workers for the price of one British worker, or 200 Russians for the price of one Japanese. Those countries are doing a professional job. They are real competitors. We have to survive by our brains and our brilliant capacity to do first-class world research.

Other hon. Members have mentioned that we have often produced world-beating ideas and scientific theories, but those inventions have been exploited abroad because British firms and British financial institutions were unable to take up the challenge. It happened with monoclonal antibodies, magnetic resonance imaging and liquid crystal displays. The list is endless. The evidence is that British universities are doing their job very well. We need to make sure that British industry lives up to that and does its job very well by carrying out industrial research and ensuring that it understands and capitalises on the science base.

I am pleased to see that, on this occasion, room has been made for the Director General of the Research Councils to sit in the Government Box. On a previous occasion he has been squeezed out.

Order. We do not refer to people sitting in the Box.

I apologise, Mr. Deputy Speaker; I was not aware of that rule.

What is the Government's reaction to the situation that I have described? I acknowledge that the Government are taking several initiatives to get academics and industrialists to work together, but I believe that they are not doing the really important things. For instance, are they trying to change the financial markets? No, they are not. They are not doing anything about the financial markets. Are they taking up the Science and Technology Select Committee's suggestion of reviewing fiscal incentives for industrial research and development? There is no sign that the Government have even started to consider that since the 1987 review undertaken by the Treasury.

Do the Government increase their input into industrial research? No, they do not. They do not keep it level. They cut it and decimate it. The DTI research and development budget is down from £683 million in 1986–87 to a projected £219 million in 1997–98. That is less than a third of the original budget. So, in 12 years, the most critical and crucial area of Government spending will have fallen to less than a third of its original value.

I wonder whether the Minister realises the extreme seriousness of all this. It seems to me extraordinary that those figures can be published and hardly commented on. I know that the Minister is fond of saying that the science budget has increased, but that myth should be exploded, and that is what I intend to do in the rest of my speech.

My hon. Friend can hardly be surprised that not much notice is taken when the Press Gallery, which was absolutely packed for that fiasco of a debate last night—if I may call it such—pays no attention when we discuss the vital interests of the country. The Press Gallery, with distinguished exceptions, is virtually empty.

I endorse what my hon. Friend has said. My local television station contacted me yesterday to find out what was coming up. I said that there was an important speech on science today. I was told, "Oh, well, you won't get any coverage for that, I'm afraid." That typifies the attitude. I am grateful to my hon. Friend for drawing attention to the emptiness of the Press Gallery today.

We will, of course, give credit to the New Scientist, which follows all our deliberations with great attention.

Indeed, the New Scientist is an extremely good scientific journal, and one which I read regularly.

We have been distributed with an extremely good paper from the Committee of Vice-Chancellors and Principals, which several other hon. Members have brought to the attention of the House. It explains what happened when changes were made to the dual support system in 1992.

There was a three-year phased transfer of funds from the Department for Education to the Office of Science and Technology. As much as £154 million was transferred by 1994–95. That money has certainly been taken out of the Department for Education budget, but I wonder whether it found its way into the OST budget. The Minister has talked of an increase in spending for science, but that transfer was never intended to be an increase: it was meant to be neutral for the total scientific spend. It was intended to cover overheads, not new research. I want the Minister to tell us if it was an increase in funding, or a sum of money that was transferred and is now being considered as an increase to make the figures look better than they really are. I want to know what happened to that money—whether it escaped en route or met the same fate as the £400 million of research and development funding at the DTI, which was filched by the Treasury to fund tax cuts at the next election.

I find the Government's science and technology policy totally irresponsible. Ministers must understand that we are discussing an extremely serious matter—tax cuts today that will mean job losses tomorrow. It is important that not only Ministers but the whole country understand that.

On the Government's claims about spending, does not the claim that research and development spending has been increased by 30 per cent. really represent a 30 per cent. increase in scientists' pay, which is rather less than the pay increase of the community generally?

I appreciate that intervention, and I hope that the Minister will take the matter up in his response.

To return to Government expenditure on research and development, let us see what else has happened. First, the research councils' budget has been top-sliced to fund the Realising Our Potential Awards, which were introduced to encourage academic collaboration with industry for what is supposed to be blue-skies research. Unless I missed something in the announcement yesterday, there is no peer review of the awards. The chairman of the Medical Research Council's molecules and cells panel has been quoted as saying that his
"panel was boxed into a corner where you had to fund something you didn't want to."
That is a damning condemnation of the way in which the awards have worked until now.

Earlier, we saw the draft of the Department's report, which showed that some research council committees complained that they were
"forced to fund second rate science".
Both the MRC and the Biotechnology and Biological Research Council judged that few applicants would have passed the peer review hurdle.

Those are damning criticisms of a new Government initiative. It is no wonder that the awards are becoming known as "ropy ROPAs"—the term commonly used among scientists when discussing them.

Last year, the sum awarded was £5 million, but it is to be increased this year to £22 million. To increase the money without proper monitoring and evaluation of the success of the awards and the extent to which they are effective is absurd. The sum represents more than 2 per cent. of the research councils' budget.

Research council funding used to be restricted to universities and polytechnics. Recently, it has been opened up to bids from independent research and technology organisations. The door has also been left-open for the funding of industrial research labs.

There is no doubt that independent research and technology organisations play a valuable role by helping to ease the link between academic and industrial research. They play an important part in that elusive sphere, technology transfer. In Germany, that is carried out by the Frauenhofer institutes, which receive up to 70 per cent. of their income from Government subsidy.

A few years ago in the United Kingdom, the independent research and technology organisations may well have received as much as 20 to 30 per cent. of their income through Government grants from research funds and so on, specifically the advanced technology programme which was administered by the DTI. Alas, that was one of the casualties of DTI cuts in research and development that I mentioned earlier.

The independent research and technology organisations now receive little money. Not surprisingly, they have been heavily lobbying the Government for reinstatement of the funds they have lost through the withdrawal of DTI money. Who can blame them? They have been told for the past two years that they will eventually be able to make up that funding by applying for research council funds. Now the Government have made the announcement and they will be able to apply, but no extra money has gone into the kitty to pay for the amount that will be taken from research council funds by the independent research and technology organisations.

It is dishonest to take money away and then give the RTOs the opportunity to dip into somebody else's pockets, because that means that another £10 million to £20 million a year will be siphoned off into the independent RTOs.

I have received a number of representations from universities about the move, including one from Professor Colin Humphries, the head of the department of material science at Cambridge university. He points out that the reduction in funding to the universities will be in key technological subjects, because they are the ones in which independent RTOs are competing, and not pure science, in which RTOs have very little interest. The very areas that the Government seek to promote in the White Paper will he most heavily hit by this move.

In addition, it is not a level playing field. Universities have to pay VAT on equipment, whereas RTOs are exempt or can claim it back. It adds enormously to the costs of university research to have to add 17.5 per cent. for VAT. Furthermore, universities have to devote a substantial amount of their time to teaching. A major research output of the universities is the research students and post-doctoral researchers who are trained there. That must be the primary purpose of universities. The RTOs therefore have a completely different ethos, and it is unreasonable to set up these two different sorts of organisation in competition.

How will the results of the move be monitored? I want some reassurance that conditions will be placed on research grants to ensure that the research will be disseminated in the same way as it is in the universities. It is important that that research is open and available to everyone, whether in RTOs, industry or anywhere else.

I shall deal briefly with the move of the OST into the DTI, because that has been well dealt with by other hon. Members. It was one of the worst handled news stories of the year, a public relations disaster. In contrast to the creation in 1992 of the Office of Science and Technology and its placement in the Cabinet Office—a move that was widely welcomed and, as a former Cabinet Minister has admitted, was taken largely from the Labour party's election manifesto—the move into the DTI has been a fiasco.

Science is not only about wealth creation; it is about quality of life, too. It brings important benefits to people through the part it plays in other subjects such as health, education, environment, transport and agriculture. As an agency of one Government Department, the OST is in no position to exercise effective co-ordination of science and technology policy across Government.

The DTI's reputation in managing research is appalling. In the early years of the LINK scheme, there was excessive bureaucracy. The privatisation of the research laboratories under DTI jurisdiction has been a disaster. Moreover, scientists have no confidence whatever in the ring fencing, which Ministers have assured us will keep the OST budget separate from that of its parent Department.

The test of the ring fencing will come quickly, when the DTI faces up to this year's administrative bill for the increased cost of the European fourth framework programme. The cost to the UK compared with the third framework programme is some £100 million a year. In previous years, the Treasury has tried to recoup that money from the DTI.

Every year, the DTI tries to get someone else to pay—unsuccessfully, I am glad to say—but what will happen this year when that money is disputed? No Minister will specifically defend the OST against the rapaciousness of the DTI. The Minister for Science and Technology is a DTI Minister, although he is supposed to speak for the OST. The comments of a head of a department at Cambridge university—
"OST funds will gradually become indistinguishable from those of the DTI, and this is likely to lead to the disappearance of Government support for any research which cannot produce profitability in the short term"—
will meet widespread agreement within the scientific community.

So will the research councils see a further £100 million disappear from their budget? I mentioned the loss of £154 million with the transfer from the Department for Education; £22 million to pay for the "ropy ROPAs"; £20 million to the independent research and technology organisations; and a further £100 million filched by the DTI. That adds up to nearly £300 million—almost a quarter of the research councils' budget.

I should like to raise a number of other issues but, like other hon. Members, I shall keep my contribution short. One disaster that I should like to mention briefly is the Medical Research Council grant applied for by the Wolfson brain imaging centre at the clinical school at Cambridge university.

That project had already received £3.5 million from the Wolfson foundation and a further £1 million from university and national health service funds. The project was alpha-star rated by the MRC, which kept in touch with its progress and fully supported the aims, yet was unable to find the funds for that excellent project.

It is a research proposal on a problem of great social and economic importance—brain injury. The research was to be conducted in collaboration with a major medical charity, together with the university and the national health service. It had scope for industrial exploitation by the pharmaceutical and medical equipment industries. In short, it was just the kind of activity advocated by technology foresight, the MRC's response to which specifically mentions brain repair as a priority area. What a disgrace that the MRC cannot find enough money in this year's budget to fund that project.

I wanted briefly to mention the lack of progress with women in science. An excellent meeting was held at the Royal Society on 19 April, and Professor Julia Higgins from the department of engineering at Imperial college illustrated extremely well the rapid decline as a large proportion of women exit at each successive career stage.

Something must be done about that terrible waste of talent, because this country pours millions of pounds into training women, giving good scientific careers, but they do not realise their potential because of how our career structure works. Far more must be done besides setting up a development unit. What is the outcome of that development unit? What successes, if any, have there been, and for how long do the Government intend to fund it?

1.19 pm

In view of the number of colleagues who wish to speak, I have promised to be brief and, unlike some, I shall indeed be so.

I am delighted that we are having this debate on science and technology policy, although future debates could perhaps be entitled "Science, Engineering and Technology Policy". One of the deep cultural problems in this country is that we do not give adequate recognition to engineering, and we should do so by giving the proper signals when we can.

To some extent, much of what has been said today is about signals—signals to the scientific community that we hold it in the high regard that any successful nation should. As the Science and Technology Select Committee said in one of its first major reports, there is a fundamental link between innovation and prosperity, and any country that forgets that does so at its own risk.

I hope that this debate will be an annual event linked to "forward look". Although I should have preferred it to be held in prime time, we have been able to have a lengthier debate by virtue of it being on a Friday. I am especially delighted that the Secretary of State for Trade and Industry opened a Friday debate. That is not a common event and is worthy of note. I am also pleased that he has sent a firm signal to the effect that the future of the Science and Technology Committee is assured. That in itself is an important signal to the scientific community.

I also welcome the Minister for Science and Technology to his post. We have known each other for some 30 years—[HON. MEMBERS: "Surely not."] Perhaps a little less. I have the greatest respect for his ability and commitment and I know how excited he was to be able to take on this particular post. I know how committed he is to doing to the job properly, but it has to be said that the restructuring that led to his appointment has caused some mixed feelings in the outside community.

To judge from the reactions that I have seen, it would appear that, on the whole, the industrial community welcomes the shift represented by my hon. Friend's appointment to the DTI whereas the academic community has expressed considerable misgivings and reservations. What he has to do to put minds at rest is to deal positively with four precise questions.

First, how well or effectively can my hon. Friend perform the role of the science, engineering and technology champion as a junior Minister in the Department of Trade and Industry, given that Cabinet Ministers have put their stamp on this policy so effectively and gained such support? At this point, I put in a plea for another signal which I do not think will necessarily be unwelcome to my hon. Friend: I think that the job of Minister for Science and Technology should be at Minister of State level. He would be an admirable candidate for it.

Secondly, how well can the strategic overview of multi-departmental research and development be performed at the DTI as opposed to the Cabinet Office? The third question has been touched on by other hon. Members and relates to the extent to which the Office of Science and Technology's budget can be ring-fenced within the DTI. Fourthly, to what extent can a fair and proper balance be established between applied and blue-skies research, given all the pressures facing the DTI?

I had wanted to refer to many other issues but, in deference to my colleagues, I shall not do so. I shall instead concentrate on a number of questions arising from the foresight programme, "forward look" and funding. We have to consider the practical use that the Government will make of the foresight programme. I know that commitment exists at the DTI because it squares with the DTI's objectives, but we want to know the extent of the commitment in other Departments and agencies. In the context of overall funding, how will the foresight programme enable our scientific base and the industries that depend on it to focus on the challenges that they are likely to meet in an increasingly competitive world?

For example, will the foresight programme guide the research councils' priorities? It is fairly obvious that it will. However, given the inevitable funding constraints, shall we spend our money increasingly thinly over the full range of issues or shall we focus on the new priorities that the foresight programme delivers? If we are to focus on priorities, it is important that the Government signal fairly early on which areas will be abandoned. If there will be no financial support for those areas in the medium term, it would be unwise for companies to make plans to develop their own funding in that area if success depends ultimately on Government support.

I am especially interested in the announcement about "extending quality life". That is an interesting innovation. As I understand it, in that approach, the Government will act as the customer for solutions to meet challenging quality of life targets and industry, supported by academia, will supply the solutions and, in the process of supplying those solutions, will acquire innovative technology and skills, which it will then be able to sell in a much wider market. That is an extremely interesting concept of the way in which to develop the relationships between academia, public funding and industry.

However, obviously, if we choose a challenge-led approach we need to know fairly quickly which areas of challenge the Government will identify. Specifically, because the funding issues will be considerable in relation to that challenge-led approach, we need to know the extent to which our priorities, as established in the UK, will be shared by the European Union. Obviously, that approach, to be successful, must bring together British and European priorities so that common funding may be focused on those areas.

Considering the Minister's role as spokesman of British science in Europe, we need to know the extent to which he feels that his priority-setting programme in the UK will be shared by his colleagues in other parts of the European Union and in the Commission. We need also to ask seriously, to what extent are we prepared to allow our contributions to large-scale international research to drive out domestic funding of our own priorities?

I am especially worried about the space industry. I have been associated with it ever since I entered the House, as vice-chairman of the all-party space committee. I have no constituency interest in that industry, but I have always supported it because I believe that it is one of the sharp end testing grounds for new technology and, as such, it drives an enormous range of other technologies through industry at large.

Many times, through the years, we led in a specific area but, the moment we were poised to seize that lead and translate it into substantial benefit, funding was withdrawn prematurely and we failed to realise the potential. Communication satellites are a good example.

We are well poised in relation to earth observation and global navigation satellites. If we are to capitalise on the tremendous work that we have done, both aspects require some committed and secure future help from the Government. However, the figures show that, especially in relation to our space budget, the contribution to the European Space Agency has remained about constant but, in a shrinking total budget, domestic funding has been largely squeezed out. I hope that my hon. Friend will find a mechanism for reversing that trend as soon as possible.

It is not only that. The hon. Gentleman agrees that the domestic budget is in jeopardy because of the contributions to the European Space Agency. Does he also agree that, given that even within that agency there is a contribution—for example, to the earth observation satellite work which is going on, from which the Meteorological Office benefits—we are not playing our full part? We are reducing our contribution to earth observation programmes in the ESA, which means that the Meteorological Office in Britain obtains less back-up than it needs, yet it remains a world leader.

With respect, I think that the British Government have played a fairly clever hand in the European Space Agency and have punched well above the weight of their financial contributions over a number of years. To a considerable degree, that reflects the fact that our industries are leaders in the field and have been able to win a considerable competitive advantage.

My answer to the question asked by the hon. Member for Leeds, West (Mr. Battle) is that the "juste retour" principle for financing the ESA is profoundly wrong. It should be done on the same basis as competition within European programmes at large. At the very least, if the "juste retour" principle is being applied, it should be applied over a much wider area of scientific endeavour within wider European programmes. On the basis of merit and competitiveness and without the "juste retour" principle always tying the hands of those who award the contracts, the British space industry would be able to achieve a great deal more than at present.

The other issue is the extent to which the private finance initiative could be used. We have looked at it in terms of infrastructure programmes in the United Kingdom, but there is a case to be made for considering whether the PFI could be adapted for substantial long-standing commitments in relation to space.

I am conscious of the time and my desire to honour my commitment to be brief and allow my colleagues to contribute in the debate. Therefore, I shall refer briefly to just one more subject: genetics. Participating in the preparation of the Select Committee report was one of the most interesting and important jobs that I have done since I entered the House. That industry will probably do more to shape human endeavour in the next century than any other. I shall not go into any detail on it, as it could constitute a debate in its own right.

My right hon. Friend the Secretary of State said that a reply would shortly be forthcoming from the Department, and I am glad about that, but those of us who serve on the Select Committee and who participated in the report believe that early action is needed on our recommendations. Action is needed because we can anticipate many of the future problems—it is much better to tackle them and set up the framework now rather than be driven to take an ad hoc approach by a series of single issues that arise in the future. I am sure that the quality of decision making then would not be as high as it could be now. This is probably the last window of opportunity for a coherent and all-embracing approach to what I believe will be one of the most important industries of the 21st century. The OST has gained great support in the business and scientific community. That has been demonstrated by the commitment of so many to the foresight programme. The analysis of what is needed for British science, engineering and technology is now in place and the Government will be judged by their actions over the next few years. I am confident that my hon. Friend the Minister for Science and Technology is the right man in the right job at the right time.

1.32 pm

I have participated in each of the debates on science and technology since I left the Office of Public Service and Science in the middle of 1993. On each occasion I have felt myself to be playing the role of a Cassandra. The House will remember that Cassandra's speeches fell on deaf ears and that she was generally held to be mad. She also turned out to be right.

The concern that I have been trying to voice in all the debates is that, in their laudable drive to improve Britain's industrial competitiveness, Her Majesty's Government are developing a fundamentally mistaken policy on basic science. The White Paper, "Realising our Potential", of which I was a part author, was an honest and, I hope, a successful effort to construct a balance to preserve the autonomy of the research councils while using them as a base within Whitehall for stronger central co-ordination of the science and technology policies of the different Departments.

Readers of the White Paper will remember that it gave up on the central question of the relation of defence research and development to the rest of Government-funded science. But at least the then Chancellor of the Duchy—who has now become Chief Secretary to the Treasury—was, with help from me, successful in preserving the funding and independence of the research councils from the determined takeover bids vigorously pressed by the then Secretary of State for Trade and Industry. I recall that he wanted 20 per cent., or £240 million, to be transferred to his Department. We won that round.

As a Cassandra, I should have recalled that nemesis always occurs sooner than one expects. Out of clear blue sky, on a side wind from the Prime Minister's successful bid to retain the leadership of the Conservative party—a bid in which I was happy to support him—that laboriously constructed policy was cast aside in a moment and all the delicate and fragile balances, which had taken two years of intensive consultation to construct, were abruptly overturned. The dream—I guess it was really always only that—of more effective co-ordination of Government science from the centre was brutally extinguished. All the research councils and their budgets were thrust into the gaping maw of the Department of Trade and Industry.

Concern has been expressed about that development by hon. Members on both sides of the House. None the less, Ministers might be forgiven for thinking: "What exaggerated language! What a Cassandra!" In the circumstances, I owe it to the House to give an account of why I regard the developments with such foreboding.

We must start with the fundamental question: why does the state support science? Basically, it does so for two reasons. First, science is an important branch of culture—perhaps nowadays it is the most important—and the state has a duty to act as a patron of culture. I recall that Lady Thatcher, as Prime Minister, put it very well in a Cabinet Committee when taking decisions about CERN. The then Secretary of State for Trade and Industry—doubtless reflecting the briefing from his Department—argued vigorously that we should pull out of such a useless enterprise, whereupon Lady Thatcher observed:
"But it is about the fundamental building blocks of the universe."
For that reason, she wanted us to stay in CERN. Science is a vital part of our national culture. My hon. Friend the Member for Bedfordshire, North (Sir T. Skeet) made a good point when he highlighted the great gap in lottery funding, which treats our culture as consisting entirely of the arts and humanities and leaves out science, which is perhaps the most creative and vital aspect of our national culture today.

The Government also support science because it is useful. It serves the purposes of the different Departments of Government, which is why each Department needs its own research policy and why each should have its own chief scientist—something that has been neglected in the Department of Trade and Industry.

If the economy is in the hands of private operators, what is the state's role in respect of economically beneficial science? Its role is not to duplicate, replace or second-guess the science and technology activities of the private sector. According to the latest "forward look" document, total spending on research and development in the United Kingdom currently runs at just under £14 billion. Compared with that, the Government's spending on basic and strategic research in universities and through the research councils amounts to only £2.2 billion. The crucial point is that the only economic rationale for that £2.2 billion in Government spending is that it supports basic and strategic science.

If basic science is to be funded systematically, it must be funded by the Government as a public good and it must be accessible to all private operators. All Governments in advanced countries across the world take that view. I hope that the DTI will take note that British access to basic science products from other countries depends critically on those countries' access to products from the continuing British effort in basic science. Despite our diminishing contribution, doors remain open to us out of respect for our heroic contribution in the past. But we cannot trade on that for ever, and if we push our luck too far we will find those doors closing in our face.

I believe strongly that the Government have a role in encouraging private operators to invest in science and technology by offering them incentives and removing disincentives. Although more could have been done—particularly with regard to the tax system, as the Select Committee pointed out—much has been done in that regard in the past 20 years. The research councils and universities should be encouraged to work closely with industry. I have no quarrel with that principle, which is the basic thrust of the White Paper and which enjoys a consensus in this House. But the critical point is that none of that adds up to any sort of case for placing the research councils in the DTI. However desirable it may be to encourage industry to take research seriously, that transfer simply goes too far.

I noticed that that was how Sir Robin Nicholson sought to defend the shift in July, as if the perspective of the scientists were at last to be given an opportunity to prevail over the short-term vision of the DTI's industrialists and bureaucrats. What, one might ask him, if the reverse were the case, as seems inherently more probable?

The final analysis is clear. There has to be a division of labour in science between industry, which must do what it can, and the Government, who should seek to do only what industry cannot. If that is the rationale for Government support for basic science—and the Treasury should not be satisfied by any other—certain consequences follow for the way in which the Government must conduct their science policy. Two of them are critical.

First, instead of being directly exposed to industrial lobbies, as will now be the case with the research councils under the DTI, the budget for basic science and the programmes sustained by it should be protected carefully and insulated from the inevitable pressures from the lobbyists for subsidies and short-term fixes. That is why institutional arrangements within the Government are so critical. In particular, that is why the arm's length principle is central to the institutional arrangements for science policy in every advanced country and why it was put at the centre of our arrangements by Haldane after the first world war and by Rothschild in 1971. The United States, Germany, France and, increasingly, Japan have structures for supporting basic science that function as our research councils are supposed to—autonomously and at arm's length from Government and industry.

In Britain, the research councils retain their autonomous statutory position as chartered institutions. So much of the apparatus that was carefully built up by our predecessors survives, but membership of the councils, which in future will be nominated by the President of the Board of Trade, is increasingly dominated by industrial interests. The independent Advisory Board on Research Councils, which stood between the Minister and individual research councils as a further level of protection, was done away with as a consequence of the shift of the research councils to the Office of Public Service and Science.

Three years ago, the research councils, their policies and their budgets were protected from the lobbies by being in the hands of the Education Secretary, by the existence of the ABRC standing between the Minister and the research councils, by the autonomy of the research councils and a membership which understood what that meant. Today, only the last of those elements remains in place. In the new institutional setting, the question is how effectively that insulation will work.

The second consequence of the rationale for Government support for science is that universities must be the central focus of that effort. Although numerous private sector research laboratories carry out important basic research, the culture of fundamental science consists essentially of an academic network. That is where the most exciting new intellectual developments are usually first registered. It is where new ideas are exchanged and developed most rapidly on a global basis, and it provides the most precious resource of all—the rising generation of scientifically educated young men and women. That is why every advanced country—except Britain—locates its governmental arrangements for supporting basic science alongside governmental responsibility for education, particularly the universities.

What are the prospects for the universities and university research under the new dispensation? I believe that they are pretty bleak. My right hon. Friend the Member for City of London and Westminster, South (Mr. Brooke) painted an accurate picture.

The research universities are facing an erosion of their position on two fronts. In respect of Higher Education Funding Council research funding, they face pressures which will no doubt be supported by the DTI—now with redoubled weight—for a shift of research funding to the so-called industrially relevant projects which will spread the jam across the old binary line. In respect of research council funding of science, they will face the consequences of the new policy—emanating from Whitehall and not from the research councils; I wonder whether it is an operational or policy matter—and which envisages the councils acting as customers for research from a wide range of sources rather than custodians of the second leg of the dual-support system for basic research in the universities.

I recognise that the initial limits of the policy for wider competition have been very circumspectly drawn. The writing is on the wall and the hon. Member for Cambridge (Mrs. Campbell) correctly spelt it out. Research funding is now open to bids from Government research establishments, ex-GREs and a wide range of non-profit research laboratories. All are worthy suppliers of applied research. Many of them may be able to plead their superiority in terms of industrial relevance to so-called "blue-skies" work indulged in by the universities.

Competition is a powerful shibboleth in today's Whitehall and it cannot be long before it will be asked why competition is limited to one aspect of directed work, why there is a limited list of competitors and why a wasteful duplication of spending cannot be avoided by giving the new technology-oriented research councils responsibility for technological laboratories that used to be paid for out of DTI funds. That point was well made by the hon. Member for Cambridge.

When I asked the Prime Minister in July for reassurances about the future of the dual-support system, he gave them with no hint of a reservation. It is true that only the margins have been nibbled so far, but future trends are in the wrong direction.

I have great regard for the talent and good intentions of my hon. Friend the Minister for Science and Technology. He and I worked on those matters when I was the Under-Secretary of State charged with responsibility for them. We see how the status of science and technology has become elevated over the years. My hon. Friend understands the case for basic science and university research. I also admire the new President of the Board of Trade, whose Scottish background will give him a special sense of the importance of the cultural issues at stake. My right hon. Friend spoke with great sincerity about his commitment to basic science, which I respect. Of course both Ministers will do their best this year, and perhaps next year, to reassure the scientific community that although much that was hitherto fundamental has changed, in reality nothing has changed. In that, I hope that they will be assisted by the Chief Secretary to the Treasury, who knows—at least, I hope he knows—how much he is responsible for what has happened to science since 1992.

Whatever the personal good will towards basic science felt by some of the Ministers concerned, what matters is what will happen in the lower depths of Whitehall, where all such matters are ultimately resolved. There, the message will be clear. Ring-fencing is one of those Whitehall phrases all too easily emptied of significance. Within a few years, no one in the DTI dealing with the research councils—Ministers or officials—will remember a time when those councils did not "belong" to them. The centralising, bureaucratic culture of that Department, which has made such an unfavourable impression in the running of the LINK programme, will gradually permeate.

Research council budgets are now part of the DTI budget, and the Department will make its overall public expenditure case every year in the usual way. It will decide its own priorities between its own programmes. It will define what is in those programmes and what is not in them. It will, like all Government Departments, aim above all to satisfy its hungry customers—which do not include universities, which belong to another Department. The DTI will naturally apply its mandate for competitiveness with progressive rigour to everything that the research councils want to do.

For example, although concern has already been expressed about the quality of the work funded by the ROPAs, I understand that they go to more or less the same people who receive responsive grants. The DTI will ask whether those awards are made for the same sort of work. If the answer is yes, what is the point of them? If the answer is no, perhaps fewer people will ask what is the point of the work. Again, the DTI is the sort of Department that will treat the technology foresight exercise established by the White Paper in precisely the way not intended—as a mechanical device for predicting and programming the research activities of whatever remains of the basic research division of UK plc. It will bear down with increasing weight on everything that seems speculative or whose pay-off looks too long term. It will grind slowly but exceeding fine.

I utter those gloomy predictions but, like Cassandra, I hope that they will not be fulfilled. We will have to watch closely. I will conclude on a positive note. I assume that the House at least halfway understands that there is something reckless in the way that we have so quickly cast off the institutional protections that previous generations thought were so important for the welfare of basic science.

Ways can surely be found of marking out clearly not only the OST's budgetary boundaries but those of its programmes, so that any shift of resource or policy across those boundaries will rapidly become visible. The Chairman of the Select Committee spoke well on that point. I am pleased that the Committee has survived the changes. In particular, we should look for clarity in respect of Euro-PES expenditure survey attributions. The hon. Member for Cambridge was right to draw attention to that problem.

The position of the chief scientific adviser to the Government and, in particular, the Prime Minister, should be safeguarded. I was pleased to hear what my right hon. Friend the President said on that point. I should be even more pleased if the Cabinet Sub-Committee had survived the recent restructuring.

Ways should be found to involve other Departments with an interest in research councils in decisions concerning their personnel and policy. Nominations to research council boards should be made jointly by my right hon. Friend and the Secretary of State with responsibility for the universities, together with another Secretary of State if appropriate—for example, the Secretary of State for Health in respect of the Medical Research Council. Why not reconstitute the advisory board to assist the Director General of the Research Councils and to ensure a properly representative membership with a strong academic presence?

I offer those suggestions as palliatives. They would help. However, the fact is that the fundamental arrangements are wrong and the research community would do well to mobilise and apply whatever pressure it can to secure an early change.

1.50 pm

I am grateful for being called to speak.

When I heard the President of the Board of Trade speak about science policy, as a Scot I thought that, if he leaves science policy in the same state as he has left Scottish politics, it will be good for the Labour party but not very good for science. Currently, Scotland is almost Tory-free; the Government's policies in Scotland were completely out of touch with the consumers of those policies.

I was struck by the fact that the President spoke at great length about the development of the private science-based companies. However, the issue is not about science-based companies but about the Government's policy. I remember that in the Chamber in 1993 there was a feeling of hope across the parties, with hon. Members talking about realising potential. Many hon. Members saw it as a non-party matter—something fundamental to Britain.

The then Chancellor of the Duchy of Lancaster, the right hon. Member for Bristol, West (Mr. Waldegrave), put forward a scenario on which we could all agree. There was to be a science Minister, who would be fundamental to the development of science. There was a new chief scientific adviser, Professor Stewart. Everything appeared hopeful and rosy. However, the Minister responsible for science prior to that responsibility being taken over by the Department of Trade and Industry, the hon. Member for Orpington (Mr. Horam), was dispensed with—a nice way of saying that he was bumped off. The hon. Member for Harrow, West (Mr. Hughes), who is in the Chamber today, also once held that ministerial responsibility.

I wonder what the role of the current Minister, the hon. Member for Esher (Mr. Taylor), will be. I am reminded of an old Rolling Stones rock song called, "The under-assistant west coast promo man". It is about someone with a very grand title but very little function. I wonder whether that describes the Minister.

We have heard from some of my hon. Friends this morning a rather good analysis of the Deputy Prime Minister's involvement in science policy. Is it his responsibility or is it the responsibility of the President of the Board of Trade? What scraps will be left for the Minister if it is a three-tier structure? I think that the DTI lost its heart when the Deputy Prime Minister took competitive deregulation away with him. The DTI has been given a brain to look after, but it is my analysis that the brain has already been lobotomised, because there is not an adequate budget to carry out the task of thinking through the problems of science.

The budget deficiencies were well analysed by my hon. Friend the Member for Leeds, West (Mr. Battle) in another excellent speech on science. He is becoming noted both within and without the Chamber for advancing and debating the needs of science rather more than the Government are doing these days. I have reached the conclusion that the Government say one thing and do another. I am reminded of the time when I chaired a local government committee and every council would say, "We've got one of those," when we spoke about policies. However, when we looked at the resourcing, we realised that the policy was often only on paper.

I accept that the Government have a policy on technology foresight
"to forge a new working partnership between researchers & and industrialists."
However, the fact is that there are budget cuts. The President of the Board of Trade this morning accepted that the Royal Society has said that highly rated research projects are not funded, while other lower rated ones with an industrial output—a short-termism—are funded. That is to be regretted, and although he rebutted it, he did not rebut it with any facts. The vice-chancellors and principals tell us a similar tale: that university research is being distorted. Rather than being focused, it is being distorted by the Government's interpretation of what technology foresight is about.

It seems to me that technology foresight is really becoming another expression for technology transfer. It is much to be applauded, and it is something about which I have spoken in the past and of which I would like to see more, but technology foresight is about a focus, not a substitution of pure research with product development. I have an example to give. The company Biomar is about to open in my constituency. I remember the managing director, Jonathan Shepherd, when he was at university with me, and was at the Institute of Aquaculture doing basic research. I was talking to him only last week. He remembers the wonder of having his first patent for something that he had developed in the lab. He went on to develop feedstock for fish farming and moved heavily into technology transfer. That is to be applauded.

Industry came in, because of a problem with getting the pigment right in the feedstuff, because, usually, wild salmon eat prawns, which gives them the pink colour. He went to a company which developed a pigment, and it is now able to make the feedstock in such a way that we get our pink salmon from farmed salmon. It was an economic success and it has had economic growth.

On 3 November in Grangemouth, I, and one of the Ministers for Scotland, will open the Biomar plant, and I am very proud to say so. It was not technology transfer at the expense of basic research, way back then in the 60s and 70s, into the growth of fish and the biological research that led to it, but it seems that the Government's policy is going in that direction.

I would also like to mention the information super-highway policy. Yes, the Government have one of those as well. To my embarrassment, as secretary to a Back-Bench committee, I organised a teleworking and video conferencing demonstration in the House, only to find that we could not get an integrated services digital network line to run video conferencing. There is only one such line in the House, in Room 15. BT had to bring one in specially. I have just come back to my office in the upper Corridor, to find that it has been rewired. There are so many plugs that I do not know where to put all the equipment, but we cannot use video conferencing with BT software, because we do not have ISDN links.

It worries me that when I went to the cable and satellite all-party group it was full of people lobbying on behalf of specific organisations. I wonder whether this is being driven by a free market philosophy rather than, as it should be, a plan. It seems to me that competitiveness—the President of the Board of Trade mentioned that it is important—should not oppose sensible Government planning, but it would appear that competitiveness is seen by the Government as an alternative to planning. Policy should not be a wish list. I seems to me that science is a Government wish list. The Government should not only encourage but share in the development of the science base. They do not appear to do so.

We, as well as scientists and the country, shall be looking at the forthcoming Budget to see whether it will reveal whether the Deputy Prime Minister and the Treasury are running science policy or whether, as he claimed when he opened the debate, it is the President of the Board of Trade. I have a suspicion that we shall find that budgets will be cut, science will be damaged and the wish list of the Government will not turn into reality.

1.58 pm

I am grateful to have the opportunity to speak briefly before my hon. Friend the Under-Secretary gets to his feet to reply to the debate. There is not time for me to follow the points raised by the hon. Member for Falkirk, East (Mr. Connarty), or develop any of his arguments, although I listened to his speech with great interest.

This has been a very high-quality debate indeed, so much so that it is quite difficult to decide which particular points to bring forward. I shall make one or two points quickly in the five minutes that I have.

I was delighted that my right hon. Friend the President of the Board of Trade was able to attend this first debate on science. That was symbolically very good news to us all, and I welcome that. He made the point about communications. I was going to say more about scientists learning to communicate better, but all I have time to say is that we had a rather good example today of how good arts people are at communicating science. I am not going to mention any of my colleagues, on both sides of the House, by name, as we know who they are. We heard some excellent speeches about science from people who specialised when at university—indeed, I was at university at the same time as some of them—in the arts, not science.

I pay tribute to Government policy on science since the general election in 1992. It has been referred to by hon. Members on both sides of the House. There is no doubt that the announcements in 1992 following the general election were welcomed. The 1993 White Paper was welcomed by a large proportion of the science community. I do not believe that Labour Members would differ from that view.

However, I go along with those who have some reservations about the transfer of the Office of Science and Technology to the Department of Trade and Industry. I shall say no more than that because the point has been made by hon. Members on both sides of the House. On the other hand—I hope that my hon. Friend the Minister for Science and Technology is listening—I have no reservations about my hon. Friend the Minister's commitment to science. At the press conference that he held in July this year shortly after the changes, he set out his views about science policy. I certainly hope that he will take it from me that, even though I have reservations about the mechanics of the process, I have none about the commitment to science that he has declared in the intervening months.

I have received a briefing note from the Institution of Electrical Engineers. I declare an interest in that every month or so I write an article for its review, so I clearly have a special interest in that organisation. The briefing makes a point that I particularly want to emphasise. It has not been referred to often in today's debate, which is about engineering as well as science. The briefing says:
"The need for well-qualified chartered engineers has never been greater, if the United Kingdom is to remain competitive."
The institution believes that one of the causes of the shortages which are now appearing of qualified engineers
"is the widely-held belief that engineering may not offer an attractive future. Nothing could be further from the truth."
I agree with that. We know now that
"Graduates from engineering and science-based courses are finding it easier to get satisfactory jobs than many other graduates."
Only the other night on television I saw a news item in which a company managing director said how difficult it was to get young qualified electronic engineers. We have been around this course before—skills shortages and shortages of graduates. It is coming up again. It is good news for us all. It ties in with what has been said in the debate about science and engineering. It is good news for us all that our young engineers and scientists have good prospects. It is good news that the average pay of engineers in industry is now reaching much better levels. That means that the work that we have done in the House to support engineering is paying off. The parliamentary group for engineering development is just one example of a group of Members of Parliament who have promoted engineering and science over the years. The good news is coming through.

My hon. Friend the Member for Pudsey (Sir G. Shaw) made an excellent speech, but I differ with one point that he made. Sadly, he is not here, but I gave him notice of what I intended to say. He said that science was primarily about the creation of wealth. I do not agree with that. I agree with the hon. Member for Cambridge (Mrs. Campbell) and my hon. Friend the Member for Wantage (Mr. Jackson) that science is about a great deal more than the creation of wealth. Therefore, I support those who have said in the debate that the Department for Education and Employment should perhaps have a little more input into science matters.

Having made that caveat, it follows—I suspect that this is what my hon. Friend the Member for Pudsey was driving at—that the creation of wealth is vital to science and vital to the future of Britain. That is why I conclude by drawing attention to the increasing opportunities for engineers. I do not mind if opportunities fall for lawyers, yuppies, accountants and media and social engineering groupies. I have insulted half my colleagues in the process of saying that.

The good news for the Government and for the country is that opportunities for engineers and scientists are increasing, according to the information that I am getting from the engineering and scientific institutions. That is a tribute to the Government's management of the economy. It means that my right hon. and learned Friend the Chancellor of the Exchequer is now presiding, as the hon. Member for Leeds, West (Mr. Battle) admitted, over a better manufacturing industry and better exports. That is good news which we all welcome.

2.4 pm

This has, indeed, been a remarkable debate—full of thoughtful speeches from hon. Members on both sides of the House—and I am delighted to have the opportunity of replying.

This is my first appearance at the Dispatch Box with the full title of Minister for Science and Technology although, as colleagues know, I was Minister for Technology in the Department of Trade and Industry for the past year and that is an important point. During my time as Minister for Technology, I dealt with many of the delivery mechanisms, which required a close understanding of what was happening within the Office of Science and Technology. At times it was frustrating that there was not a greater proximity between what I was attempting to do and what the OST was encouraging me to do.

The hon. Members for Cheltenham (Mr. Jones) and for Falkirk, East (Mr. Connarty) both mentioned the information super-highways and the policy that we have had to develop, with which I was involved, such as the importance of a research base for computing science in universities and ideas as to how one might introduce new content to the super-highways.

Content is as important as infrastructure because it is demand for the content that will pull through the upgrading of infrastructure, and not some national plan. The hon. Member for Falkirk, East came dangerously close to his leader's misconception, but I think that he is probably far too shrewd for that.

There is no need for a national plan on infrastructure. We want to encourage a diversity of content that is affordable, interesting and applicable, particularly in schools, so that we can build up people's confidence and appetite for the products of the super-highways, which will pull through the demand for upgrading from twisted copper pair—which, with compression, can already do a remarkable amount—to full optical fibre connections in some cases.

I was also responsible for the small firms merit award for research and technology and for the support for products under research scheme. Fascinating companies are coming forward, often made up of only one or two people, many having spun out of the universities. Many of the awards, especially those in the SMART category, were for professors or people who had been working in academic research schemes and had had an idea, which they were looking to develop into a commercial reality. We were providing help.

I was immensely encouraged and stimulated by the interface in many of our universities between those who were conducting the research, but at the same time realised that it should not be confined to them. They had a bursting desire to get out into the commercial world to find out whether there would be a profitable demand for their ideas.

All those aspects and many more, including technology transfer and innovation, were part of my responsibilities—as were the teaching company and postgraduate partnership schemes, both of which I extended during my period in office. All the aspects were remarkably fascinating, but needed to be combined into a broader field. That is the logic of the merger of the Department of Trade and Industry and the Office of Science and Technology. It was not cooked up one night after a drink at I am or 2 am, as some Opposition Members allege.

Whatever time of day it was concocted, it was the result of a thoughtful process. As the former chief scientific adviser said, the OST had been a fledgling organisation when it was in the Office of Public Service and Science, but it had come of age. Once the organisation came of age—it was bursting with ideas, which the technology foresight process developed—it was a logical time for it to become part of a much more broadly based Department: the Department of Trade and Industry.

Sir William Stewart made that point, as did many other people, including the former chief scientist at the DTI, Dr. Geoff Robinson, who was referred to in the debate. In an article in "Research Fortnight" on 12 July, he said:
"Scientists have long argued that science is central to modern industrialised societies. They cannot be disappointed if the government has finally listened."
The Government listen. We understand the needs. The merger has taken place and the new system will be much more effective in delivering precisely the needs of the science base.

The merger was forged not after a drink, but in the heat of political necessity, on the anvil of political imperatives and very quickly, with more regard to politics than was good for science.

The hon. Member for Linlithgow (Mr. Dalyell) has always had a fluency in language. I am talking about fluency of policy, and we have achieved precisely that with the merger.

On the fluidity of policy—certainly, there was rapidity of policy—my hon. Friend says that the merger was a deeply contemplated move. I can tell him that there was never any suggestion at any time from any party or anybody who was consulted in preparing the White Paper that it would be an appropriate move.

I was in the Government with my hon. Friend the Member for Wantage (Mr. Jackson) at that time in the humblest of all posts—that of bag carrier or parliamentary private secretary, to the then Minister for Public Services and Science, now Chief Secretary to the Treasury. Of course, the merger was not contemplated at that stage precisely because, as Sir William Stewart has said, the OST was then a fledgling organisation.

I was about to pay credit to my hon. Friend for his pioneering work then, to which he referred in his speech. It is the very success of the policies that he introduced which has given the OST the strength and capacity to be part of a broader organisation. The continuum of policy will not give substance to the genuine fears of my hon. Friend. I understand his profound concern, especially for the binary system on which he worked at the Department of Education and Science, as it then was. I greatly respect his comments and I assure him that while I cannot accept this conclusion about the need to redivide the DTI and OST, I accept his ambitions for the future of university-driven research. It is, I hope, safe in my hands—as it was in his when he was one of my predecessors.

I have a difficult task in the amount of time remaining to sum up the debate because so many subjects were covered. The hon. Member for Leeds, West (Mr. Battle), whom I follow around the country as we attend the same experiments—though I might say that he follows me around the country, too—

I am known as "Speedy", so I can move fast. I will not give way to such jibes.

Unless the hon. Gentleman was making a series of interesting expenditure statements in his speech, his concerns for the science community are understood by the Government. We are not attempting to debase basic science. I am not sure whether he used the words "blue-skies vision" as part of his peroration or out of genuine anxiety for that activity.

The preservation of university blue-skies research is crucial to Britain's future and not only for wealth creation—a phrase that I have not found to be spat upon as dirty when I have visited universities. The understanding of the importance of the creation of wealth is as alive and well in our great universities as it should be. A failure to recognise that link has held certain universities back. In most cases, they are worried about lack of full responsiveness from the industrial community to the importance of blue-skies research. I have set as a key objective of my period as Minister for Science and Technology a strengthening of the interface between rich and productive basic science and industry.

I accept the criticisms—although not all of them, as I do not intend to be that generous—of the hon. Member for Cambridge (Mrs. Campbell). There are enormous gaps in UK performance. That is why the research and development scoreboard has been published by the DTI. There is no point in a DTI Minister trying to pretend that things are better than they are. It is our job to stimulate industry to do better. That is why we have brought forward two competitiveness White Papers, warts and all.

The scoreboard has some frightening warts on it, given the paucity of research in some sectors of British industry, which are asking for annihilation in the competitive markets of the world unless they do something about it. Our great centres of excellence—the pharmaceutical industry is an obvious one—have thrived precisely because they understand that a strong industrial base depends on a strong basic science base. But I would also argue that a strong science base will thrive in the long term because there is a strong industrial base in similar sectors.

There should therefore be no embarrassment that we are bringing together the OST and the DTI. Indeed, I regard it as a signal achievement that we have recognised that to improve the performance of the overall economy and quality of life in Britain we must link the two.

In the fascinating lecture at the Royal Society recently—the Bernal lecture—the former chief scientific adviser said:
"My view after five years in Whitehall is that the emphasis by industrialists on the need for a strong science base has been as influential in achieving it as the concerns that allege under-funding by parts of the scientific community."
That is a serious message. Too much whingeing by scientists as opposed to quiet rational thinking will undermine a broader public understanding of the science base. As I said when I was at the British Association for the Advancement of Science in Newcastle, and I have said it several times to some of the key scientists who have been to see me, my reaction is one of despair—it was also my reaction to some of the statements that were made about British science on the radio this morning—because scientists are doing the opposite to attempting to get a proper public understanding of the excellence of our science base and exactly what is being done to improve it.

Given the gaps in the research and development scoreboard, will the Minister examine in detail why the position is so much worse in British companies than in comparable companies overseas, in terms of their research intensity?

Yes, we are analysing that because we are very concerned. The former President of the Board of Trade got into trouble at one point when he talked about a long tale in British industry of underperforming companies. Part of the reason for that is a lack of understanding of the importance of research, both applied and basic, and we are looking closely at that matter. If we are to improve this country's competitiveness, we may have to ensure that we improve the value added at all levels of our society. I entirely agree with the comments that have been made in the debate to the effect that if we are to survive we must use our wits, and our scientists' wits are as important as those of any other section of the community.

Before leaving the subject of the research and development scoreboard, I should say that the overall picture shows that we have performed better than our principal competitors over the past two years. This year, there was a net increase in research and development expenditure. However, having already talked of the flaws in taking averages because to do so overlooks the bad points, I shall not pursue that argument further.

It is important to recognise the benefits which could flow from the merger of the OST and the DTI. The current chief scientific adviser, Professor May, has written to me saying:
"The transdepartmental responsibilities of the Chief Scientific Adviser have been preserved entirely as a result of his new position."
Those are his words, not mine. He has already had extensive discussions throughout Government, including with the Prime Minister. These are early days during which the full force of the chief scientific adviser's role will need to be felt, but I assure hon. Members that he takes a keen interest in keeping the DTI up to scratch as well. Most importantly, there is no confusion in his mind about his role in relation to the DTI.

I shall give way once more, but I am conscious that I am running out of time.

Does my hon. Friend think that the chief scientist would find it of assistance in performing his role if the Cabinet Committee, which formerly operated at the centre of those arrangements, were reinstated?

The jury is out on that. All that I have said so far has to do with science playing an integral role in a broader committee on which the chief scientific adviser sits. I would therefore wait for him to say that he was concerned. The broader sphere of the competitiveness of the United Kingdom into which science fits is a better basis from which he can wield influence than a separate committee. As I said, one of the strengths of the position of chief scientific adviser is that he can speak out publicly, but I shall keep in close touch with him. His view and mine is that the integration of science into the influence on government is a positive step forward.

I have an embarrassment of interventions, but I give way to the hon. Member for Leeds, West.

On a practical point, will the Minister inform the House what steps have been taken to get every other Government Department to respond with a plan setting out how they will respond to technology foresight? Is that being co-ordinated within the OST? Have such plans been drawn up, and will they be made publicly available?

Yes, they have been drawn up and they are being pursued. The chief scientific adviser recently published an article in, I think, the CBI's journal pointing out that the key themes that emerged from the foresight exercise are now being examined and an implementation programme is being developed.

There were originally six priorities, but the EQUAL—extend quality life—theme on which I am keen is now the seventh. We are incorporating them into science, engineering and technology portfolios and the Higher Education Funding Council's funding methods. We are also building new partnerships with industry using the foresight challenge competition, the teaching company scheme and the LINK programme and we are co-ordinating on reporting SET developments and progress within these priorities. Equally, we are examining them in the context of every other Government Department that has a delivery function. The chief scientific adviser has made that one of his highest priorities.

I welcome the speech made by my hon. Friend the Member for Pudsey (Sir G. Shaw), who has done tremendous work with the Science and Technology Committee. I am delighted that the Committee is to continue and will probably gain in strength due to its ability to range more widely. I am looking forward to being with the President of the Board of Trade in the Committee next week. I am sure that we shall be cross-questioned in some detail on various policies.

I strongly welcome the report on genetics. We have not yet commented in detail on our reactions, but we shall soon do so. I agree with my hon. Friend that the subject is very important and needs to be given a full airing in the House, although that is a matter for the business managers, not for me. I have already commented on the scrutiny report, but we can go into further detail.

My hon. Friend's key question related to whether we should have a science adviser at the DTI to follow Geoff Robinson. One of the points made was that the DTI was moving the focus of its work slightly downstream, which is one of the reasons why the link with the OST is so constructive, and pushing many of the activities into the sponsorship divisions to increase effectiveness in terms of the work of those divisions and regional policy. Science and technology activities will be fully integrated with other work aimed at industrial competitiveness. I agree that we need constantly to examine whether we are delivering the improved competitiveness effectively, and I shall bear my hon. Friend's words in mind.

I take it that the fact that the Department's expenditure on science has fallen from £350 million in 1992–93 to £222 million this year in no way reflects on the absence of the chief scientific adviser. I should have thought that, had there been such a person, expenditure might not have fallen so dramatically.

I beg to differ with my hon. Friend on that. We can consider that in Committee. Flippantly, I can assure him that that was not the salary of the former chief scientific adviser of the DTI. Seriously, there are some significant complications in DTI expenditure, largely stemming from the position of energy and the fast-breeder reactor and the problem of launch aid costs, which are considerable. Therefore the net effect has been a diminution of classified R and D spend in the DTI, not a diminution of the interest and effort of the DTI in that direction.

Many other hon. Members have contributed to the debate, which was at a high level. My right hon. Friend the Member for City of London and Westminster, South (Mr. Brooke) represents a full gamut of excellent universities. The only one that he did not mention was the. London School of Economics, where I did some postgraduate work—sadly, not in what we would generally call science. I am afraid that those of us who represent the dismal science nevertheless still proudly hold up our heads.

My right hon. Friend made some strong arguments. I obviously cannot comment on those that touch on the budget of the Department at this stage, but we understand his anxiety about several aspects, such as international salience.

My right hon. Friend commented about responsive mode. If one undertakes a technology foresight exercise, the conclusions of that exercise are bound to form judgments in the minds of research councils, as they consider what to fund. The principal division of funding for the research councils is between responsive mode, whereby they have a peer review process of projects that are brought to them, and directive mode, whereby they try to fill in gaps or there are programmes that they wish to engage in.

So far, the research councils appear to be very clear in their minds that the balance is about right. The foresight programme is bound to influence them, perhaps more in the directive mode sense, but not exclusively. We should not be too worried about those connections.

I say in reply to the comments of the hon. Member for Motherwell, South (Dr. Bray), that controversies always arise when people inquire more deeply into research council grants. In our opinion, the grants have been made after careful consideration and consultation, and the responsive mode aspect of what the research councils do is not affected. We are speaking about directive mode. Therefore the argument that the hon. Gentleman made about someone coming up with a good idea and its then being put out to tender does not really apply.

My right hon. Friend the Member for Chertsey and Walton (Sir G. Pattie) made an important speech about intellectual property, which is often neglected. I was responsible for that in the previous year—not only now—and I know that Lord Woolf is undertaking a wide-ranging review of civil procedure. As part of that review, a sub-committee chaired by Mr. Justice Jacob, the senior patent judge, is specifically considering intellectual property legislation.

I take all my right hon. Friend's arguments seriously. I am actively involved in the World Intellectual Property Organisation discussions and the arrangements in respect of the treaty on intellectual property in respect of integrated circuits. We must make sure that the outcome of our discussions is effective because piracy, especially in the transfer of ideas in research and in multi-media for the super-highways, is a crucial problem.

The hon. Member for Linlithgow spoke about short-term contracts. Due to the short time remaining, I shall write to him, but I reassure him that the report of the House of Lords Committee and the draft concordat of the vice-chancellors almost coincided, and therefore I do not believe that the House of Lords took into account what the concordat discussed. So far, the Committee of Vice Chancellors and Principals appears to have reacted positively to the concordat and therefore there is not as much to be worried about as the hon. Gentleman alleges.

We believe that we are getting it about right. I understand all the problems of uncertainty arising from short-term contracts. As the President of the Board of Trade said in his opening remarks, American universities appear to have a good record with short-term contracts, but I pay tribute to some of the schemes now inquiring into ways in which we can alter that position. The university of Warwick has obtained funding for a scheme that will consider longer-term ideas.

I do not have time to go into some of the other issues, but I nevertheless draw attention to the generic research that the Higher Education Funding Council for England has started, which is likely to alleviate some of the hon. Gentleman's worries.

We could spend hours debating the subject of the budget. It is up by 30 per cent. in real terms since 1979. Over the past 10 years there has been a 10 per cent. increase in the science base, although clearly civilian and military research have been in decline. With just one minute left, I do not intend to go into that.

Ropy ROPAs are not ropy; the university of Cambridge is about the best. I am sure that the hon. Member for Cambridge did not mean to criticise her own university.

We have had a remarkable debate. I have been unable to do justice to all my colleagues' comments, but I can confirm that we have a profound understanding of the importance of the science base simply because we want Britain to be competitive in the world.

It being half-past Two o'clock, the motion for the Adjournment of the House lapsed, without Question put.