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Volume 475: debated on Thursday 15 May 2008

8. What progress his Department has made towards achieving its public service agreement targets on innovation. (205667)

We have just entered the period covered by the new public service agreement. Past trends indicate that good progress is being made. For instance, the latest UK innovation survey reports that 64 per cent. of UK businesses were active in innovation over the period between 2004 and 2006 and that there was a 19 percentage point like for like improvement over the six years before that. University interaction with business and other users has been increasing across a range of indicators, with support from Government programmes such as the Higher Education Innovation Fund. Our White Paper, “Innovation Nation”, sets out further policy commitments to help innovation flourish right across our economy and public services.

There must have been some reason why the Department started out being called the “Department for Innovation” apart from the fact that a Department called “DUS”—Department for Universities and Skills—would have sounded a bit dismal. I suppose “DIUS” has pretensions to sounding like a Greek god-like Department. I remain intrigued to know what Ministers are doing in practical terms to encourage inventiveness, ingenuity and innovation in constituencies like mine? What difference do the people of Banbury and Bicester see as a result of this Department being called one for “Innovation”?

We are indeed the Department for Innovation, and Dius is a minor Roman god for oaths—or, as someone once said, for swearing! As a Government Department, we are doing a great deal to encourage innovation across our economy. If the hon. Gentleman looked at “Innovation Nation”, our White Paper launched in March, he would see that, in addition to our new policy commitments, a range of activities are already under way. There is funding for the Technology Strategy Board, which will spend £1 billion over the next three years in collaboration with industry to stimulate innovation. We are doubling the number of knowledge transfer partnerships, enabling university researchers to work with companies on practical projects. There are new commitments in “Innovation Nation” to annual innovation procurement plans that every Department will produce, so that we can harness some of the £150 billion that we spend every year on encouraging innovation and developing more growth-oriented small businesses.

The Sainsbury review is a stinging indictment of Government failure when it comes to innovation. It contains about 100 criticisms. I am sure that the Minister has read it. As for the Government’s response—the White Paper “Innovation Nation”—it appears to me to be an admission of guilt.

After talking for 10 years about public procurement innovation, the Minister said last week that we haven’t cracked it yet. On page 3 of the Sainsbury review, Lord Sainsbury says:

“Demand-side factors, such as procurement and regulation, which can play a role in encouraging innovation, have received too little Government focus”.

Does the Minister agree with his well-respected predecessor?

When I met David Sainsbury yesterday, he was very satisfied indeed with the progress that we are making in implementing the review’s recommendations. One of the things that we have done as a Government is establish a science and innovation framework from 2004 to 2014. We have made a policy commitment to funding the science budget at least in relation to the level of growth of the economy, which is why it will grow by 2.7 per cent. in real terms over the next three years.

The hon. Gentleman’s policy, as I understand it from the shadow Chancellor, is to share the benefits of growth. When the shadow Secretary of State, the hon. Member for Havant (Mr. Willetts), rises to ask his question, perhaps he will tell us either that he agrees with the shadow Chancellor, or by how much he wants to cut the science budget.