fst journal The Journal of the Foundation for Science and Technology

Volume 21, Number 3, May 2014

Sir John Enderby: Misconduct in scientific research Communicating risk Sir Mark Walport: Communicating risk and uncertainty in science Tom Bolt: The commercial management of risk Judith Hackitt: Whose risk is it anyway? Stimulating growth Professor Colin Riordan: The contribution of Higher Education to the regional economy Sir Leszek Borysiewicz: The key to economic success Sir Terry Matthews: The vital importance of focussing on the customer Learned societies – Raising the bar Professor Jeremy Watson, Patrick Kniveton, Professor Tim Broyd, Professor John Uff Digital participation Professor Alan Alexander: How can the benefits of digital access be made available to everyone? Lorraine McMillan: A role for local government in delivering the digital agenda Dr Alan Blackwell: Representation and identity in a digital world Decarbonisation Dr James Smith: Counting the cost of decarbonisation Dr David Clarke: Creating an affordable energy system for the UK Baroness Verma: Delivering a low carbon future Research and technology Sir John O’Reilly: Maximising UK strengths in research, innovation and Higher Education Ben Ritchie: The criteria for measuring value Professor Geoff Rodgers: How Higher Education can deliver value to UK business

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CHIEF EXECUTIVE Professor Dougal Goodman OBE FREng *Associate member

Neither the Foundation nor the Editor is responsible for the opinions of contributors to FST journal. © 2013 The Foundation for Science and Technology. ISSN 1475-1704 fst journal Volume 21, Number 3, May 2014 contents

THE COUNCIL OF THE FOUNDATION fst inside front cover journal UPDATE The Journal of the Foundation for Science and Technology Volume 21, Number 3, May 2014 IPCC says 2°C limit still achievable; Catapult network to be reviewed; Linking with

Sir John Enderby: Misconduct in scientific research Communicating risk emerging economies; A new vessel for polar exploration; Developing the next Sir Mark Walport: Communicating risk and uncertainty in science Tom Bolt: The commercial management of risk generation of vehicle engines; Lack of diversity ‘a loss to the UK’...... 2 Judith Hackitt: Whose risk is it anyway? Stimulating growth Professor Colin Riordan: The contribution of Higher Education to the regional economy Sir Leszek Borysiewicz: The key to economic success EDITORIAL Sir Terry Matthews: The vital importance of focussing on the customer Learned societies – Raising the bar Professor Jeremy Watson, Patrick Kniveton, Professor Tim Broyd, Professor John Uff Misconduct in scientific research Digital participation Professor Alan Alexander: How can the benefits of digital access be made available to everyone? Sir John Enderby...... 3 Lorraine McMillan: A role for local government in delivering the digital agenda Dr Alan Blackwell: Representation and identity in a digital world Decarbonisation Dr James Smith: Counting the cost of decarbonisation COMMUNICATING RISK Dr David Clarke: Creating an affordable energy system for the UK Baroness Verma: Delivering a low carbon future Research and technology Communicating risk and uncertainty in science Sir John O’Reilly: Maximising UK strengths in research, innovation and Higher Education Ben Ritchie: The criteria for measuring value Professor Geoff Rodgers: How Higher Education can deliver value to UK business Sir Mark Walport...... 5

T H E F O U N D A T I O N F O R S C I E N C E A N D The commercial management of risk fs t TE C H N O L O G Y Tom Bolt ...... 6 Whose risk is it anyway? www.foundation.org.uk Judith Hackitt...... 8 carries reports on all STIMULATING GROWTH Foundation meetings . The contribution of Higher Education to the regional economy Professor Colin Riordan...... 10 The key to economic success Sir Leszek Borysiewicz ...... 11 The vital importance of focussing on the customer Sir Terry Matthews...... 12 LEARNED SOCIETIES Raising the bar Professor Jeremy Watson, Patrick Kniveton, Professor Tim Broyd, Professor John Uff...... 14 DIGITAL PARTICIPATION How can the benefits of digital access be made available to everyone? Professor Alan Alexander...... 16 A role for local government in delivering the digital agenda Lorraine McMillan...... 17 Representation and identity in a digital world Dr Alan Blackwell...... 19 DECARBONISATION Counting the costs of decarbonisation Dr James Smith...... 21 Creating an affordable energy system for the UK Dr David Clarke...... 23 Delivering a low carbon future Baroness Verma ...... 25 RESEARCH AND TECHNOLOGY Maximising UK strengths in research, innovation and Higher Education Sir John O’Reilly...... 26 The criteria for measuring value Ben Ritchie...... 27 How Higher Education can deliver value to UK business Professor Geoff Rodgers ...... 29 EVENTS...... 31

FST JOURNAL >> MAY 2014 >> VOL.21 (3) update

Developing the next IPCC says 2ºC limit still achievable generation of vehicle A new report by the Intergovernmental The report, entitled Climate Change engines Panel on Climate Change (IPCC), 2014: Mitigation of Climate Change, is the released in mid-April, sets out how global third of three Working Group reports, Projects that could put Formula One emissions of greenhouse gases have risen which, along with a Synthesis Report due technology into buses and diggers, by to unprecedented levels despite a growing in October 2014, constitute the IPCC’s developing the next generation of engines, number of policies to reduce climate Fifth Assessment Report on climate are the first to receive money from a joint £1 change. Emissions grew more quickly change. billion government-industry programme. between 2000 and 2010 than in each of Scenarios show that to have a likely The Advanced Propulsion Centre the three previous decades. chance of limiting the increase in global (APC) will see government and industry According to the Working Group mean temperature to 2°C means lowering each invest £500 million in the sector over III contribution to the IPCC’s Fifth global greenhouse gas emissions by 40-70 the next 10 years to research, develop Assessment Report, it would be possible, per cent compared with 2010 by mid- and commercialise technologies for the using a wide array of technological century, and to near-zero by the end of vehicles of the future. The first £133 measures and changes in behaviour, this century. Ambitious mitigation may million of new investment was announced to limit the increase in global mean even require removing carbon dioxide on 23 April. temperature to 2°C above pre-industrial from the atmosphere, argues the IPCC. According to the Government, the levels. However, only major institutional Even less ambitious temperature goals APC funding has the potential to secure and technological change will give a better would still require similar emissions up to 30,000 jobs currently linked to than even chance that global warming will reductions. producing engines and create many more not exceed this threshold, says the study. www.ipcc.ch in the supply chain. Consortia led by Ford, GKN, Cummins and JCB have all received Catapult network to be reviewed funding for projects to improve fuel efficiency and reduce carbon emissions. An independent review by technology of the Offshore Renewable Energy entrepreneur Hermann Hauser has been Catapult offices in Glasgow on 13 March. launched to look at how the Government’s Herman Hauser’s initial review, Lack of diversity ‘a loss Catapult network of elite technology and entitled The Current and Future Role of to the UK’ innovation centres can be fully exploited Technology and Innovation Centres in to benefit the economy in the long term. the UK, was published in March 2010 A lack of diversity across the scientific The review was announced by Business and resulted in the establishment of the community represents a large loss of Secretary Vince Cable during the opening Catapult network. potential talent to the UK according to the chair of the Royal Society’s Equality and Diversity Network (EDAN), Professor Linking with emerging economies Edward Hinds FRS. As a Royal Society report on the topic The Government has launched a £375 The fund will lay the foundation was launched, he commented: “With million fund to promote economic for ongoing collaboration between the diversity comes a mix of ideas, skills development though science and partner countries and the UK, promoting and approaches. If the UK’s scientific innovation. The Newton Fund will the UK as an international partner of workforce is not diverse, we are bound improve the science and research choice and seeking opportunities for to be missing out on some great talent. capabilities of emerging powers and commercial collaboration in the journey At a time when the UK is seeking to use strengthen ties with Britain. towards sustainable global growth. its scientific capabilities to help improve The fund will allow the UK to use its www.gov.uk/government/publications/ lives and rebuild the economy, it is more strengths in scientific research to promote newton-fund-building-science-and- important than ever that we ensure the economic development and welfare in innovation-capacity-in-developing- best scientists can flourish.” emerging economies. countries Approximately 20 per cent of people in the UK workforce need scientific knowledge and training to do their A new vessel for polar exploration current jobs. The study found that science workers The UK is to get a new polar vessel. greater endurance and ice-strengthened living in the highest income bracket With funding of more than £200 million capability, enabling scientists to start households at age 16 were more than announced by the Government, the research voyages earlier in the season. five times as likely to take a professional new ship should be ready for its first Built with flexible laboratory level occupation than those in the lowest science mission in 2019. Owned by configurations and the capability for bracket. NERC (Natural Environment Research containerised laboratories, the new ship It also found that students from black Council) and operated by the British will carry sophisticated environmental and ethnic minority groups were less Antarctic Survey (BAS) on behalf of the monitoring systems that will provide likely to progress to scientific jobs after UK polar science community, the ship data from the deep ocean, the surface graduating than white students, though will deliver the next generation of UK ocean and the atmosphere. It will be the data relating to ethnicity is extremely marine science in the Antarctic and the able to carry remotely-operated deep-sea mixed and complicated. Arctic. vehicles, which can explore the harshest https://royalsociety.org/policy/projects/ The new flagship will build on the environments on the planet and explore leading-way-diversity/uk-scientific- best features of both existing polar the seabed in detail. workforce-report research ships; it will be larger, with www.antarctica.ac.uk

2 FST JOURNAL >> MAY 2014 >> VOL. 21 (3) editorial Misconduct in scientific research John Enderby

ave you ever heard of the written by Hearnshaw, concluded that acronym ‘FFP’ or indeed the charges made by Gillie were justified ‘CC BY’? What, if anything, and, in 1980, the Council of the British has this to do with the Psychological Society endorsed these Hdreaded Japanese knotweed? Allow me conclusions. to explain. Not surprisingly, Burt’s many FFP is the accepted shorthand admirers were distressed and several for unethical behaviour in scientific papers and books were written on what research: it stands for ‘Falsification, became known as the ‘Burt Affair’. Many Fabrication and Plagiarism’. The reacted strongly to the allegations made Foundation’s Chief Executive confirmed in The Sunday Times. In reviewing a to me that, to his knowledge, the book edited by N J Mackintosh and organisation has never held a meeting published in 1995, Professor Robert on scientific fraud. Yet, the issue is Audley wrote: “Whatever the prior of increasing importance, especially opinions of the reader, this examination Professor Sir John Enderby given the emphasis on basing policy of the available evidence must surely be CBE FRS is the Editor of on evidence. Questions such as, how accepted as scrupulously fair and lucidly FST Journal. He was widespread is fraud, what motivates presented”. Audley went on to conclude scientists to engage in FFP and does it that “although some of the evidence he Professor of Physics at actually matter, are largely ignored by published in his later years is of doubtful Bristol University from 1976 many scientists. scientific value, the contributions he to 1996. He was elected When I was learning Educational made during a long professional life a Fellow of the Royal Psychology as part of my teacher remain impressive, and I believe it is training at Westminster College, Sir misleading to continue to hold him Society in 1985 for his Cyril Burt was regarded as the ultimate up as the icon of scientific fraud”. The pioneering studies into the authority and we were all encouraged consensus now appears that some of structure and properties to read his books and papers. He Burt’s papers were rather carelessly of liquids and amorphous was considered to be one of the most presented and perhaps it was a mistake important psychologists in the UK. to publish so much in his own journal. materials. He served as a Until his retirement in 1951 at the A much clearer example of FFP is Vice-President of the Royal age of 68, he held a Chair of Psychology that of the highly-respected and much Society from 1999-2004. at University College, London. He honoured Dutch social psychologist, One of his responsibilities received numerous honours including Diederik Stapel. News broke in 2011 a Knighthood (the first psychologist to that Stapel had committed fraud on an was the Society’s publishing be so honoured) and in 1971, shortly industrial scale. In his autobiography activities. Sir John was before his death, he was awarded the (2012) Stapel admitted that he started President of the Institute Thorndike Prize by the American committing fraud with minor data of Physics in 2004. He was Psychological Society. His study of falsification and then moved on to the Chief Scientist at IOP the intelligence of twins separated at outright fabrication. The extent to birth concluded that intelligence was which fraud of this magnitude, coming Publishing. heritable and Burt was highly influential from a leader in the field, has led to in Government policy-making regarding doubts about the subject as a whole was post-11 education. In short, for those faced directly by Stroebe and Hewstone learning educational psychology, Burt in Times Higher Education (THE) on 28 was a god-like figure. March 2013.

Shock Physics Imagine, then, my shock when an Physicists often felt that FFP was not article by Oliver Gillie appeared in The a major concern in their discipline Sunday Times on 24 October 1976 with until the Schön affair. Here was a the headline ‘Crucial Data Faked by member of staff at the prestigious Bell Eminent Psychologist’. Citing work by Telephone Laboratory who published Leo Kamin, Gillie concluded that the many papers in so-called ‘top journals’ data on twins had been fabricated and (Nature, Science, Applied Physics Letters, that Burt’s two research assistants, Jane etc) known for their high standard of Conway and Margaret Howard, never peer review. At least 16 turned out to existed. contain misleading and in some cases In 1979, his official biography, fabricated data.

FST JOURNAL >> MAY 2014 >> VOL. 21 (3) 3 editorial

For example, in 2001 Schön How widespread is scientific fraud? taining adequate databanks for exter- announced in Nature that he had There have been relatively few detailed nal scrutiny; produced a transistor on the molecular studies but most conclude that outright • publishers bear special responsibili- ties. First, they must ensure that ref- scale. Schön claimed to have used a fraud is still comparatively rare. More erees are truly impartial and unlikely thin layer of organic dye molecules to worryingly, however, is that there is to be influenced by the reputational assemble an electric circuit that, when evidence that FFP is increasing and capital of the authors. Publishers acted on by an electric current, behaved is perhaps driven by the highly- should also use modern software to as a transistor. The implications of his competitive nature of modern science. detect plagiarism. Papers found to be work were significant. It would have In 2011, Nature reported that there had fraudulent must be retracted at the been the beginning of a move away from been a ten-fold increase in the number earliest opportunity and sanctions silicon-based electronics and towards of retractions over the previous decade. applied to the offenders. Papers ema- nating from the Editor or his or her organic electronics. It would have An analysis, published in the institution need truly independent allowed chips to continue shrinking past Proceedings of the National Academy of assessment, something which did not the point at which silicon breaks down, Sciences, concluded that of the 2,047 happen in the Burt case. and therefore continue Moore’s Law for retracted papers considered, 75 per cent much longer than predicted. involved scientific misconduct of one Creative Commons As a result of doubts about this form or another. One of the authors, Dr Research Councils UK (RCUK) has work, Bell set up a committee chaired Arturo Casadevall, stated that a major announced that the Creative Commons by the highly-respected physicist driver for scientific misconduct is the Attribution licence (CC BY) will be Malcolm Beasley. The 127-page report culture in which a paper published in applied to articles it funds. The CC found substantial evidence for fraud a major journal can be “the difference BY licence is the most liberal of the CC and concluded that all the misdeeds between heading a lab and facing suite and many colleagues are worried had been performed by Schön alone. unemployment”. about the implications. His co-authors were completely CC BY allows anyone to copy, dis- exonerated of scientific misconduct, What can be done? tribute and transmit the information but it was unclear whether all of them What can be done and by whom? contained in the publication without had exercised sufficient professional In reality, everyone in the scientific permission of the copyright holder. responsibility in trusting the integrity of enterprise must play a role in rooting Moreover, it permits re-mixing with his data. Schön was dismissed from his out misconduct and thereby preventing other material and allows both com- post and suffered other sanctions from public disillusionment with science. mercial and non-commercial use. While his home university in Germany. This must apply especially in subjects CC BY does require full attribution, which attract immediate media attention some commentators feel the attribution Widespread fraud such as climate change, energy and food portion of a CC license may be diffi- A charge of widespread scientific fraud, security, as well as health. In particular: cult to enforce (see for example Crotty’s involving 26 articles published in 11 • authors have a responsibility to keep article in http://scholarlykitchen.sspnet. journals, was levelled by the University rigorous records of data and to make org) leading to fears that this form of of Connecticut against Dipak K Das, them fully available as required. copyright protection might be a charter Schön, for example, had virtually no one of its researchers, whose work record of his experiments, stating for plagiarists. reported the health benefits of red wine. that the raw data had been ‘lost’; In response to worries on this score, Many of the articles reported positive • a co-author, especially if a ‘big name’, the CC organisation, in its advice to the effects from resveratrol, an ingredient of must take full responsibility for that Department for Business, Innovation red wine thought to promote longevity part of the paper attributed to him and Skills (BIS) stated: “Plagiarism is in laboratory animals. The charges or her. Many journals insist that in a completely orthogonal issue to copy- against Professor Das remain to be the case of multiple authors, a clear right infringement, and there is simply fully substantiated and indeed many statement of individual contributions no evidence we know of that would sup- must be made. The danger is that of his colleagues strongly disapprove the appearance of a highly-respected port a claim that CC BY would promote of the University’s position and have name on a paper might unconscious- or encourage plagiarism”. Nevertheless, exonerated him from all charges. A ly influence the decision of a referee there seems to be a problem with self- defamation case was brought by or editor; plagiarism and this is an issue which Professor Das against the University but • heads of institutions have a responsi- individual publishers need to manage. sadly he died on 19 September 2013. bility to ensure that good practice is Has this Editorial highlighted issues Resveratrol is found in the skin of red part of accepted culture. In an im- which might form the basis for one portant THE article in April 2013, grapes and in other fruits, as well as in Watson and Hayter argued that uni- of our evening dinner/discussions? the roots of Japanese knotweed. In fact, versities must play a major role in Answers please on a postcard (or is it red wine contains very little resveratrol monitoring research outputs at the by email?) to the Foundation – office@ – of the order of 0.1-14.3 mg/l. point of submission, as well as main- foundation.org.uk. ☐

The purpose of the Foundation for Science and Technology is to provide a neutral platform for debate of policy issues that have a science, engineering or technology element. Details of all Foundation meetings, including speeches and presentations, can be found on the website at: www.foundation.org.uk

4 FST JOURNAL >> MAY 2014 >> VOL. 21 (3) communicating risk

How can decision makers be helped to understand the inherent uncertainty in risk model selection and outputs? Can policy be evidence-based when model outputs have wide bands of uncertainty? These questions were debated at a meeting of the Foundation for Science and Technology held on 5 February 2014. Communicating risk and uncertainty in science Mark Walport

here are several aspects of The key question, then, is: “Under risk that have to be borne Sir Mark Walport field conditions, is the exposure of other in mind by scientists who FRS FMedSci is the pollinating insects to these substances Government Chief advise Government. The first unacceptable?” If exposure is at a safe Scientific Adviser concerns the terminology involved, level, then the insecticide will achieve its T at the Government specifically the distinction between Office for Science. aim, killing the unwanted insect, not the risk and hazard, two terms which are Previously, Sir useful one. The problem, to be frank, is often confused. Second, scientists Mark was Director of the Wellcome that the evidence available is not robust must recognise that policy makers and, Trust. Before joining the Trust, enough to answer this question. indeed, the public, look at issues through he was Professor of Medicine and In laboratory conditions it is different ‘lenses’, including different Head of the Division of Medicine possible to show how neo-nicotinoidal values. Then, too, there is undoubtedly at Imperial College London. He insecticides can have deleterious effects the challenge of clear communication. has been a member of the Prime on bumblebees, honey bees and other The assessment of risk is at the Minister’s Council for Science and insects. What is lacking is clear evidence heart of the work of the Government Technology since 2004. that, when applied according to the Office for Science. Among the urgent manufacturers’ guidance, they still have issues currently being studied by both toxic effects in the field. the US and UK governments are the Risk and hazard This distinction between hazard (and risks associated with space weather, Risk is commonly defined as the product many things are hazardous) and risk is specifically the possibility of another of hazard exposure and vulnerability. Yet a continuing challenge for regulators. solar storm like the 1859 Carrington there is a great deal of confusion about There is a tendency to regulate by hazard Event. What would be the consequences the terms ‘risk’ and ‘hazard’. The issue of rather than by risk. for telecommunications, electrical grids pesticides illustrates this clearly. With new technologies, there is the and satellites? The question involves pesticides, further issue of communication about the Flooding is extremely topical with pests and pollinating insects. The EU risks involved. There are risks associated questions being raised about the has recently imposed a moratorium on with almost everything humans do: they consequences of building on flood plains the use of neo-nicotinoid pesticides in have to be managed and not ducked. and the appropriate level of spending to agriculture, but the UK opposed this Unfortunately, there is too often a make such housing safe to live in. decision. The issue is not whether neo- tendency to duck. Those are natural hazards but there nicotinoid pesticides are hazardous to In the case of Genetically Modified are also human threats – terrorism, insects: they are designed to be extremely Organisms, the mistake was to talk emissions of carbon dioxide and other hazardous, hence the term ‘insecticides’! about them in a generic sense, yet there pollutants into the environment, for They should, though, kill the undesirable is nothing generic about a GMO. By example. insects while having limited impact on the focussing on the specific purpose, the The Government produces a freely- insects that society wants to encourage. individual organism and the nature of available National Risk Register1. A simple and effective way to represent DISCUSSION risk is to classify each according to both Scientific advice impact and likelihood (see Figure 1). How does uncertainty impact on scientific evidence and the advice tendered Risk registers can be utilised to help prevent undesirable events, as well as to to decision-makers through trusted advisers? Decision-makers may need to mitigate, manage and clear up when they act very quickly when the scientific evidence is not complete and there are do occur. But can they also be used to still areas of uncertainty. Uncertainty is not a ground for rejecting scientific decide the relative investment that one advice though, since uncertainty applies to other areas as well, such as public allocates to different threats? Can they opinion, the attitude of the courts, and foreign reaction. It is important to find provide a basis for evaluating investment ways of explaining to decision-makers the range of uncertainty - whether it is options? Decisions have to be made fundamental, or does it apply only to specific, less-important aspects of the about how public money should be question? spent, after all.

FST JOURNAL >> MAY 2014 >> VOL. 21 (3) 5 communicating risk

is a very good example. On the one hand, there are legitimate scientific and

5 Pandemic influenza engineering questions about hydraulic fracturing: will there be any damage to aquifer zones by leakage of contaminated

Coastal flooding fluids; will there be significant side 4 effects; will fugitive methane be released? Effusive volcanic eruption These are key questions. Now, the Royal Academy of Engineering has concluded Severe space weather Other infectious that all of these concerns can be managed diseases Major transport Major industrial Low temperatures and 3 accidents accidents heavy snow where best practice is applied. Inland flooding Heatwaves Go and talk to the protestors in Sussex, though, and there is actually a different Animal diseases Explosive volcanic conversation taking place. Some of these eruption 2 Drought people are totally opposed to the oil and Storms and gales Public disorder gas industry, some simply do not like capitalism, while others are motivated by a ‘not in my back yard’ attitude. Disruptive Severe wildfires 1 industrial action Different lenses To communicate effectively, it is Between Between Between Between Greater than 1 in 20,000 and 1 in 2,000 and 1 in 200 and 1 in 20 and 1 in 2 necessary to look through the ‘different 1 in 2,000 1 in 200 1 in 20 1 in 2 lenses’ that various parties have on these issues. Studies show that about three- Figure 1. Likelihood of current risks plotted against overall relative impact on a 1-5 scale. Source: National Risk Register of Civil Emergencies 2013. quarters of the population are fairly or very concerned about climate change; they believe the UK should reduce its use the genetic modification, there can be should be transparent; it must take into of fossil fuels. A similar proportion are a sensible discussions about hazard and account the general principles of risk concerned that electricity and gas will risk. It is not helpful to treat a whole management (in other words being become unaffordable and a very similar technology as though it poses a single proportionate), it will involve thorough proportion again (70-80 per cent) are risk. risk/benefit and cost/benefit analyses and concerned about energy security. These include constant review as new evidence are the three policy lenses which are The Precautionary Principle emerges. important, of course, when talking about The Precautionary Principle is often Unfortunately, regulators are energy. brought into these discussions. It is frequently subjected to asymmetric There is then work to be done in assumed to mean that if there is any incentives. There will be trouble if exploring people’s values around, on the possibility of anything harmful, then that something is allowed to go forward one hand, the finite nature of resources, choice should be avoided. However, this which causes harm. However, there is linked to people’s feelings about waste, is only one interpretation. no consequence for stopping something efficiency, environmental protection, The UK Government interprets the happening that would actually have social justice and fairness. On the other EU communication on the Precautionary brought benefit. This is a profound there are the issues of availability and Principle as requiring the fullest possible problem because it means that the affordability, reliability, safety, as well as scientific evaluation of the hazards, incentive system is loaded entirely in one freedom of choice. exposure and vulnerabilities associated direction. Society should recognise that It is vital to understand the nature and with a particular choice. A decision to harm can frequently flow from omission interplay of these issues seen through act or not is preceded by an evaluation as much as commission. different lenses if there is to be a sensible not only of the hazard but also the The confusion between risk and and constructive debate. ☐ consequences of not proceeding along this hazard can lead to different parties in 1. https://www.gov.uk/government/ path – in other words, the consequences an argument talking at cross-purposes publications/national-risk-register-for- of inaction. The Precautionary Principle without realising it. The fracking debate civil-emergencies-2013-edition The commercial management of risk Tom Bolt

very successful economy has uncertainty from its balance sheet by they can plan and, critically, grow their found a way to manage risk taking out an insurance contract, has been businesses. So in some ways, Lloyd’s is a (which is another word for used for centuries. The basic premise public repository of uncertainty. ‘uncertainty’). Formal risk has always been that insurance exists to For the last 325 years, Lloyd’s Etransfer, where a business removes absorb other people’s uncertainties so underwriters have specialised in ‘decision-

6 FST JOURNAL >> MAY 2014 >> VOL. 21 (3) communicating risk

they are approximations and they have general inflation – all of which involve Tom Bolt is some weaknesses. some uncertainty. Performance With actuarial risks, such as car Director at Lloyd’s Insurable risk accidents, there are plenty of traffic of London – the Lloyd’s deals with several types of risk: collisions which enable the industry to insurance market. event risk is essentially about ‘acts of fine-tune its estimates. For earthquakes Previously, he was God’ such as earthquakes, hurricanes, on the other hand, it is very hard to Managing Director tsunamis, floods, brushfires caused by get that estimate right. This makes of Marlborough lightning, hailstorms etc. estimation of frequency troublesome – Managing Agency. He has extensive experience in international Actuarial risks are those events or scientists have proved invaluable here by insurance and reinsurance across acts of God which have sufficient data or augmenting the small amount of actual the UK, USA and Europe and observations for the law of large numbers claims experience we have with proxy has held senior roles in Berkshire to be used as a way of determining data. Even so, investors in these sorts of Hathaway’s reinsurance divisions frequency and sometimes quantum. risk demand a higher return on capital and as President of some of its Behavioural events are those acts of due to the additional uncertainty in insurance subsidiaries. He also man where the law of large numbers earthquake business than motor. assisted in the formation of Bankers can be applied to begin to assess the risk The best summary of the sources Trust Insurance Derivatives (motor, etc). of uncertainty in using models comes business, as well as a related group Lloyd’s typically covers the risk that from Peter Taylor of Oxford University. of insurance and reinsurance people find hard to insure in their local As Table 1 shows, there are items of companies. markets; for example, property exposures model uncertainty, data uncertainty and on the East Coast of the USA which is un-modelled uncertainty. The Tohoku at significant risk of hurricane damage, earthquake, which caused the 2011 making under uncertainty’. Until the or property in California that is at risk Tsunami in Japan, caused some to criticise Derivatives boom of the late 80s and early from earthquakes. A great deal of our the standard modelling, for example. But 90s, bank balance sheets were reasonably business is commercial risk – this may a magnitude 9 earthquake was not thought fixed and determinable. Deposits were include construction projects, offshore to be possible in that region and so none fixed and loans were absolute amounts. oil platforms, major buildings owned were included in the models. With the advent of Options, Futures by property companies, aircraft, ships, and Derivatives, banking institutions professional negligence – in short, just Scrutinising modelling introduced uncertainty to their balance about every aspect of the economy. That Lloyd’s scrutinises the models used by sheets in unprecedented ways. is why, over the years, Lloyd’s has paid the members of its market to ensure While much of the 2008 and 2009 out on Piper Alpha, the World Trade that they understand the strengths financial crisis was down to the age-old Centre, the Costa Concordia, Deep and weaknesses of those models – the problem of over-leveraging, a part was Water Horizon, Hurricane Katrina, Thai nuances, the appropriateness of fit for due to Bank Boards not fully appreciating flooding – in fact most disasters. the model against the portfolio. We how probability-driven their financial Pricing is an art and, increasingly, also seek to ensure that the uncertainty statements really were. a science. Yet in all calculations, there factors around the use of the models are estimates involved for different are communicated very effectively to Jump risk factors. The expected level of claims is the board of the underwriters, especially Insurers are largely firms which buy assessed using statistical models (ranging when the members are being given a and hold what might be termed ‘jump in complexity and often based on past number derived from the model – a risk’. Derivatives traders operate on the claims experience), or physical models ‘willing to lose’ number, in a sense, for concept that there will be a continuous of the claims process, often merged big events like the California quake or market for their instruments. In other with engineering and scientific models. Japanese earthquake. People need a words, every morning they can get up Expenses have to be calculated and, frame of reference when they are told and they can trade on the Exchange. within this, inflation is one of the great they might, say, lose over $4 billion with Jump risk comes from discontinuity. For imponderables for the coming years. a particular probability. They also need example, if the Japanese Stock Market There will be repair costs, regulatory to understand the uncertainty factors were to close following an earthquake compliance, medical costs, legal fees, underpinning that statement. and not open for two weeks there would be a big gap between the level where it DISCUSSION last closed and where it opened up again Trust and advice – there would be a ‘jump’. Jump risk is A trusted expert adviser will be trained to consider all the risks involved in planned difficult for derivatives traders – which policy changes. They will use a risk register and identify who owns each risk, who is why they pay large sums to protect will be affected and what the probability and consequences of an event arising against it. At Lloyd’s there is an entire from the policy are likely to be. At the centre of the relationship between adviser building of what might be called ‘jump risk underwriters’. and decision-maker is trust. However, ‘trust’ does not mean that the adviser The insurance industry has tools and shares closely the ambitions of the decision-maker, and becomes reluctant to press techniques for communicating levels of alternative views, or even to become subject to ‘group think’. This could, perhaps, risk. It also uses modelling extensively be a danger in the public service where Ministers feel bound by a manifesto or other and I believe we are better off with commitments, and find advice which stands in their way unhelpful. models than without them. However,

FST JOURNAL >> MAY 2014 >> VOL. 21 (3) 7 communicating risk

Model uncertainty Data uncertainty Unmodelled uncertainty Model inadequacy Wrong location Secondary perils Model risk Understated values Contingent business interruption Parameter risk Building risk profile Policy wordings Calculation error Schedule out of date Loss adjustment expenses

Table 1. Uncertainties in modelling. Source: Peter Taylor.

It would be a major advantage if the if there is a flaw in that model, it has surrounding any 1-in-200 assessments in language could be simplified and more effects throughout the system. That is order to avoid misinterpretations. Over- easily understood. It could then be one of the reasons we encourage the use optimism as well as too much pessimism used more widely across business and of other models, as a way of suggesting can be equally unhelpful. The challenge industry, providing people with a better people should evaluate uncertainty in a for the actuaries is to communicate view of what is happening. variety of ways. uncertainty in a way that is effective, but It is not the aim of Lloyd’s to run While models are very useful (they not career-limiting! a failure-free regime – we are, after make a very useful skeleton upon which to In my department we try to maximise all, taking risk from everyone else in hang the rest of the underwriting process) market skill and understanding of the the economy to soften the risk of their there is also the aspect of sound judgement, data. We look mainly at risks that are failure. At some point this will happen which is what underwriters get paid for. systemic and focus on areas that present and what I want to make sure is that the biggest dangers to the market as if underwriters ‘blow-up’ due to this Modelling losses a whole: chief among these are the uncertainty, the exposure is limited to a Regulators essentially want to know what accumulation of property values in high defined amount, i.e. the capital that has our estimated 1-in-200 year losses amount risk zones around the globe. been put up! to. That is difficult though, given that the To sum up, Lloyd’s works with people Yet people do need to be sensible modern insurance industry is only 25 to that could be termed ‘merchants of about what they are doing and so we 30 years old and earlier loss data is hard uncertainty’. It tries to ensure they are not monitor systemic risk. One of those to model with any degree of confidence. taking on overwhelming risk: after all, systemic risks is the use of models. One Different types of uncertainty can swamp our promise is to honour every legitimate of our model vendors has 38 out of our our models. It is important then to promise to pay and this has been the case 54 agencies in its customer base. Now, be able to make clear the uncertainty for Lloyd’s for 325 years. ☐ Whose risk is it anyway? Judith Hackitt

he Health & Safety Executive populated areas. In reality, factories, or economic reasons. (HSE) is a statutory consultee housing, schools and shops have So, the reality is that safety is one for planning applications developed close to each other; indeed, among a number of elements to be concerning major hazard sites, in many cases the hazardous industries considered by local planning authorities. Tpipelines and applications for hazardous themselves provide the economic heart of A balance must be struck between the substances consent across Great Britain. the local community. needs of industry and the community, Our advice aims to mitigate the potential In the UK, given our population both now and in the future. effects of a major accident on the density the pressures on suitable land As a statutory consultee, HSE can population around a major hazard site. for the development of housing, retail, advise against developments, but the The chemicals industry provides many public use, etc, present significant decision to act on that advice rests with benefits to us all, but it also presents challenges. The desire to retain green the local authority. There are numerous risks. Where hazardous substances space leads to a preference for brownfield cases where a planning authority grants are present in large quantities, the development, but this often leads to planning permission against HSE’s consequences of major accidents in terms demands for land adjacent to existing advice. In most of these, HSE recognises of loss of life, injury, damage to property hazardous installations to be used for that the authority has made a balanced and disruption to essential services housing, schools, hotels, shopping centres judgement and so takes no action. On can be very significant. This has been and other amenities. This can lead to rare occasions (there have been just six evidenced in major accidents in the UK large numbers of additional people being in the last 40 years), HSE has exercised at Flixborough (1974) and Buncefield brought into the zone of risk. its right to request the decision be ‘called (2005), across Europe at Seveso (1976), Options are limited even when in’ and made by the Secretary of State for Enschede (2000) and Toulouse (2001), planning the location of new hazardous Communities and Local Government. and elsewhere in places such as Bhopal activities. Few locations exist where (1984) and Mexico City (1984). new hazardous installations can be sited Risk communication Ideally, industries using large without creating some risk to an existing The challenges HSE faces are twofold, quantities of hazardous substances community. Yet remote locations may be and they are related. The first is to would all be located far away from highly unacceptable for very good environmental present its advice on the nature of the

8 FST JOURNAL >> MAY 2014 >> VOL. 21 (3) communicating risk risk in a way that does not present us through measures such as: re-orientating as standing in the way of community Judith Hackitt CBE the development within the site to move benefit; of the hotel, shopping centre, FREng is Chair high occupancy further away from the of the Health and school or whatever is being planned for hazard; adjusting heights of structures, Safety Executive. development. The second is how to location of windows and points of access. She worked in explain ourselves clearly to those with a So our current thinking on risk the chemicals different perspective, knowing that we are manufacturing communication and uncertainty in the dealing with multiple uncertainties. industry for 23 context of land use planning is that Some residents will have lived near a years before joining the Chemical we have to reposition ourselves. This major hazard facility for years and know Industries Association (CIA) repositioning has three elements: when that there has never been a major incident in 1998. She became Director do we engage; who within HSE does it; there. Yet a proposal to build additional General of CIA and then worked in and how do we engage in terms of the housing, a school or a hotel, will trigger a Brussels for the European Chemical substance of our advice? consideration by HSE of the total number Industry Association (CEFIC). Our engagement must be earlier in of people who could be affected by an Judith Hackitt is President of the the process and focussed on working incident at the new development. This Institution of Chemical Engineers with planners and developers, so that may result in the potential number of and a Fellow of the Royal Academy new facilities are designed in ways that casualties being deemed unacceptable. of Engineering. She is also a senior minimise risk. Now, the long term resident who has non-executive director and trustee We need to develop a role as ‘risk lived there for 30 years will find it very of the Energy Saving Trust and a educators’. By moving this function from hard to understand that the same hazard non-executive director of the High our regulatory staff within the Hazardous now presents an unacceptable risk when Value Manufacturing Catapult. Industries Directorate to our Health there has never been a problem before. and Safety Laboratory (HSL), we act as Some residents may depend for their gasholder: a top-tier COMAH (control of advisers to the planning process rather livelihood on the major hazard site and get major accident hazards) site. than as regulators of the health and safety an immediate benefit from its existence. HSE advised against the development at work process. Positioning a new school next to that because of its proximity to the gasholder We are constantly seeking to improve site may seem preferable to parents when and the significant increase in the number communications and understanding so compared with an alternative location of people close to the gasholder in the new that we can collectively find solutions which may, for example, require pupils development and therefore at significant rather than polarising the debate into who to cross a busy main road every day. risk in the event of an explosion. is right/wrong and who owns the risk. A How does one weigh up the arguments The application was nonetheless jointly-developed solution that reduces associated with complex, low-frequency, approved. HSE then requested that the death and injury in the event of a low- high-consequence events as against application be ‘called in’. A planning risk, high-impact event surely benefits familiar hazards and consequences which inquiry followed and the decision was everyone involved in the development. people encounter every day? made to grant planning permission for the development. HSE’s safety advice was Stakeholder engagement Whose risk? acknowledged by the planning inspector How we engage with other stakeholders The HSE provides advice to local planning but on the balance of risks versus benefits must change too. Many of us love QRA authorities which will allow them to the application was cleared. - Quantitative Risk Analysis. In a world make informed decisions that reflect an of uncertainty we seek to attach a level of understanding the risks. But when a local A new approach numerical certainty to the chances of an planning authority goes against our advice For us, the process had been expensive event happening, but how helpful is it in – who owns the risk? What happens and inefficient. The lessons included the stakeholder engagement? if a major incident occurs? Who will need for frequent communication, more QRA has its uses, but not in the area the community and the media look to, face-to-face meetings, involving a wider of risk communication. A risk probability to explain why particular decisions were range of stakeholders and, perhaps most of 1x10-6 may mean something to risk taken? importantly, being involved at an earlier professionals, but it can give a false sense of If we advised against the development stage. There are also some cautionary security to some that the event will never but it went ahead, do we have to approach notes about the use of tools designed to happen and can therefore be ignored. the major hazard site to take action to help decision-making but which can act The impression of certainty over further reduce their level of inherent risk as a barrier to early communication. something which is inherently uncertain in light of the development? What about More recently, a similar case, near also leads to mistrust of experts. Residents people who move into the area after the a gasholder close to the RAM brewery of the Somerset Levels are clearly very development? Are they informed about in Wandsworth, has turned out rather confused and upset that floods which the risk? By whom? How? differently. Here extensive engagement experts said should only happen once in In January 2008, a planning application between HSE and stakeholders led to a 100 years have now occurred two years in was submitted to redevelop part of the mixed-use residential and commercial succession. Oval Cricket Ground. The proposal was to development going ahead but with Explaining risks, particularly those replace stands and some minor buildings significant risk reduction from the which people do not see everyday – with a new plaza, a six-storey stand original plans. Earlier engagement with and could therefore instinctively incorporating around 2,000 additional a broader group of stakeholders enabled understand – is one of our big challenges. seats and a hotel. The development us to influence the design so that risks Communication has to be combined with would be right next to the Kennington could be minimised. This was achieved education. ☐

FST JOURNAL >> MAY 2014 >> VOL. 21 (3) 9 stimulating growth

Can university-business collaboration help maximise short-term economic growth and reduce unemployment in economies like Wales? The question was debated at a joint meeting between the Foundation for Science and Technology and The Learned Society of Wales on 3 July 2013. The contribution of Higher Education to the regional economy Colin Riordan

recent report by Higher critical element: businesses want access to Education Wales (HEW) Professor Colin research expertise but above all they want showed that HE creates tens Riordan FLSW highly-qualified people. The universities of thousands of jobs1. It is President and create graduates who are capable of setting Agenerates about 3 per cent of Welsh GDP Vice-Chancellor, up their own businesses as well as creating and it creates over £400 million in export Cardiff University. jobs and wealth. earnings: this is mainly through overseas Previously he was Our seed venture fund, called the revenue from international students Vice-Chancellor Cardiff Partnership Fund, has invested coming to study in Wales, but also of the University of Essex. In more than £4 million in 48 projects 2009, he chaired the Higher from research collaborations and other (including almost £2 million invested Education Funding Council for international activity. Welsh HE generated in 14 spin-out companies) since it was England’s enquiry into teaching 38,802 jobs across the country and more quality. Professor Riordan is Vice- started just over a decade ago. These than 43,000 UK-wide in 2011-12; so that President of Universities UK and projects have since leveraged £60 million is really a significant impact. sits on the boards of UCAS, the in follow-on investment from a wide Every million pounds of university Edge Foundation, the Leadership range of sources. revenue generates a further secondary Foundation for Higher Education The university’s Commercialisation output of just over £1 million in the Welsh and the Equality Challenge Unit, Initiative supports spin-out company economy. This knock-on effect is to be which supports equality and activities in collaboration with Fusion found in supply chains, in purchasing diversity for staff and students in IP plc. The initiative invests in new links, in staff spending and of course in Higher Education across all four and existing spin-out companies. Fusion student spending as well. As universities nations of the UK. now has more than 20 companies in its grow so the economy grows. portfolio, of which 10 are based in Wales. Cardiff University, for example, is the research in Cardiff and other Welsh About £25 million has been invested in third largest employer in the area, with over universities is critical to economic success. Cardiff University spin-outs. 6,300 staff. Some 28,000 students bring in We work with industries and businesses Knowledge Transfer Partnerships an estimated £200 million annually to the across Wales, including multinationals like (KTP) are also critical. Cardiff University local economy. Around 27 per cent of the Ford and Tata Steel. Importantly, though, currently has 21 active KTPs where international student population in Wales we are also engaged with more local university academics and students work study at Cardiff, making a contribution of companies – Cassidian and the Media together with companies, supported around £45 million to the local economy. Standards Trust for example. by a Government grant, to create or Universities offer consultancy services improve a business or industrial process, Investment to business and industry, giving them management methodology or indeed a Further short-term economic benefit and access to expertise in specialised areas. technology. more jobs can be achieved through capital They offer professional training as well investment. Cardiff University is investing as postgraduate programmes which Innovation around £400 million over the next five provide highly-skilled graduates to the In the longer term, innovation will years or so, not just in student and research workforce. In many ways that is the be the key to economic growth and facilities but also in innovation centres and research translation hubs. That DISCUSSION investment alone will create jobs (directly Skills have to be learned throughout life and indirectly) now and in the future. It is not sufficient to ensure that graduates are well-prepared for their first job. The university’s research base supports more than 1,800 research grants and In the modern world, with rapid technological change and the possibility of a contracts valued at around £500 million. number of major career changes, graduates need to have the capacity to relearn. Some 80 per cent of that is funded from For this reason, curriculum design has to meet the needs of several stakeholders, outside Wales which represents a major including both students and employers. Innovations such as the Raspberry Pi inward investment. (production of which has now been brought back from China into Wales) can University research itself has a powerful greatly enhance the ability of students in information and communications economic impact and engages across a technology (ICT) by introducing them to programming. wide range of sectors. World-leading

10 FST JOURNAL >> MAY 2014 >> VOL. 21 (3) stimulating growth prosperity, and we all need to create well as advising on the public acceptance processes of innovation during their time the environment where innovation of technology. It is all very well inventing at university, from the initial planning can flourish. To achieve this, it is vital shale gas technology and GM foods, but right through to eventual success. to build and maintain a culture of if that creates a public outcry we need There need to be places where people innovation throughout the university, to know before we encounter serious can meet to discuss ideas they would not just involving staff but students as setbacks and we need to have a strategy not otherwise come across; from different far as possible as well. It is important for addressing the reaction. sectors, from academia, from business, to develop an innovation system here in In Wales, creative and heritage from students. Cardiff but it has to occur in collaboration industries are critical to future economic At the most basic level, the will to with other universities, with Government growth so we intend to create, for succeed is what will make the difference. and, most importantly, with industry. instance, a creative industries hub which We in Wales have to decide, collectively, Wales also needs translational research will allow us to foster work in that area as that we will be outward-looking and facilities which bring together academics well. The Arts and Humanities have an re-invigorate our economy through and private enterprises. important part to play in the future of the education, innovation, research and Social scientists will play an integral Welsh economy. development as well as business/university part in the process, operating in areas such Student involvement is essential to interaction, driven by a shared vision of as science policy research, supporting the success. It needs to be built in from the future. ☐ R&D process by taking part in early-stage the start, through enterprise education 1. www.hew.ac.uk/wp/media/2013-June-The- technological development to help avoid for both graduates and undergraduates. Economic-Impact-of-Higher-Education- expensive and time-consuming pitfalls, as Undergraduates must be exposed to the in-Wales1.pdf The key to economic success Leszek Borysiewicz

cross the European Union, Apprenticeships are really sought- technology. Universities must foster that one quarter of people between after, but there are simply not enough to interest. 18 and 25 years of age are go round. Perhaps technology itself can The Raspberry Pi was created in unemployed. So Wales is not be used to increase the effectiveness of Cambridge in 2008 because applicants Aunique. A McKinsey report1, launched training? to Computing Science in Cambridge did in Davos at the World Economic Forum In addition to the short term issues, not know how to programme. Up until in January 2013, noted that, globally, 75 there are longer term questions about the 1995, virtually every single applicant to million people under the age of 25 are economy and the role of universities. The Computing Science knew how to write unemployed. enterprises we spin-out from universities a programme and that was because they Half of those leaving post-secondary are going to be small. They will not have grew up with Spectrums and BBC Micros education do not believe that education the capacity to replace Tata Steel, for which did not have much software. People has played any part in their employment example, should it withdraw from parts could have fun with them by writing the prospects. Some 40 per cent of employers of the industrial network. programmes for themselves – even I was say young people are lacking in relevant able to connect my computer to a gamma skills. Yet 72 per cent of providers think Promoting entrepreneurship counter in order to get counts more easily they are delivering on skills (it transpires In terms of attitudes, universities must than sitting there all night. that 50 per cent of the employers who foster a culture in which it is equally Production of the Raspberry Pi is now complained have never spoken to the good to be an entrepreneur as it is to based at Sony in Bridgend. This shows post-secondary education sector). Now be an academic. At Cambridge, despite that Wales has the skills to produce this those are global statistics but the UK its reputation for ivory towers and blue- in a competitive way compared to other numbers are very similar. sky thinking, the most popular student parts of the world. More than 1.5 million Where economic success has been society is the Entrepreneurship Society. Raspberry Pi units have been produced identified, employers and post-secondary It is interesting to note that as many in Wales so far. Students are learning education work together. So local members come from the arts and the how to programme using this and they solutions are the only way to successfully creative sector as from engineering and will find ways to improve it for the next tackle the problem. However, if answers can be found DISCUSSION at that local level, then the second tier Business success challenge is to scale up. Anyone in Wales has a relatively poor record, in relation for example to Scotland, of industry will say that scale-up is the securing funding from the Technology Strategy Board and the Research Councils. vital ingredient for doing things really It is not just the number of and quality of applications that counts but also the effectively. Scale-up is going to require vigour with which these are submitted and followed up. For the Welsh economy the use of innovative technologies and to grow and prosper, there has to be not only a continual flow of innovation-led it will also need the application of these new businesses, but also a readiness to allow natural selection to take place. through enhanced skills. What are the most effective (and cost-effective) ways The weakest ventures must fail and the strong ones grow in size and scope. of inculcating these skills in our young Wales needs more big winners! people?

FST JOURNAL >> MAY 2014 >> VOL. 21 (3) 11 stimulating growth generation. That is innovation, that is disease. entrepreneurship and that is how growth Professor Sir Leszek What are the possibilities for South happens. There are success stories in Borysiewicz FRS Wales? Well, the Welsh Assembly is Wales and we need to celebrate them. FRCP FMedSci working with the Higher Education sector FLSW is Vice to look at ways to stimulate employment Clusters Chancellor of – that will be a big asset. Then there is the University of A feature of universities, which helps to Europe and particularly the structural Cambridge. He drive entrepreneurship, is that sooner funds which places like Cambridge, for began his career or later they develop a ‘clustering effect’. example, cannot access. But innovation at the Welsh National School of Companies look for places where they Medicine, the Royal Postgraduate should not just be focussed on South can find a spirit of entrepreneurship and Medical School in London Wales. There are opportunities for a focus on innovation. In universities, and Addenbrooke’s Hospital in Cardiff to work with bodies in Bristol Britain has some of the best innovation Cambridge. In 1991 he returned and the South West. The rest of Wales centres anywhere in the world, so why is to his home city of Cardiff when could be encouraged to engage with this it that people talk about importing these he was appointed head of the wider perspective too. skills from outside? Department of Medicine at the It is, though, essential not to fall into However, one has to be careful University of Wales. He went on the trap of expecting a 95 per cent success what metrics one uses to judge their to be Deputy Rector at Imperial rate. Successes of a little more than 50 per effectiveness. What can kill such centres College and the Chief Executive of cent mean that sufficient risks are being is the kind of assessment based on third- the Medical Research Council. taken. Some enterprises are going to fail party licensing income. If you look at and this is a very difficult message for Cambridge, the figure is zero – we give politicians to give to taxpayers in these away much of our intellectual property families; and a high standard of housing. hard-pressed times. The innovation because we want to create a local culture What attracts businesses? One thing – community has to support politicians of entrepreneurship. From this approach the Innovation Centre and the people that when they start making difficult has come the Cambridge Cluster. It drive it. Microsoft moved to Cambridge decisions and are criticised by the media originated in 1960 when two people because Roger Needham was there, for ‘wasting money’ on failed projects. decided to put innovation to work locally. someone they wanted to work with. That Short-term exploitation can help deal Even in 1995, Cambridge had no was enough for them to create their third with the immediate issues facing the billion-pound companies: today it has institute, the others being in Seattle and country like youth unemployment. To 12. The Cambridge Phenomenon now Beijing. do this effectively, much greater working encompasses 1,500 companies and together between education providers employs 54,000 jobs, all created from Unpredictable and industry is vital. This will also lay the scratch. Now innovation is inherently foundation for the longer term success of Success brings its own challenges. We unpredictable. In 2000, Amazon was a the economy. are short of the technical staff we need to bookseller. Today, less than a decade and Last but by no means least, make sure service these companies. Any incoming a half later, it is the biggest logistics and there is a stable research base within the company asks for three things of the distribution industry in the world and universities because once this economic local economy: good transport links – has completely revolutionised the way we success story has been established, half i.e. an international airport, motorways, think. In 2000, who could have predicted the world is going to try to poach the easy transit times to London; local an innovation like Humira, the biggest- talent! ☐ education of the highest quality – people grossing drug of all time, with £9.3 billion 1. http://mckinseyonsociety.com/downloads/ will demand that the schools deliver sales in 2012. This treatment for breast reports/Education/Education-to- the highest quality schooling for their cancer is changing the very nature of that Employment_FINAL.pdf The vital importance of focussing on the customer Terry Matthews ne very important ingredient ferrous metal processing, and supporting does not take a huge amount of money in any economic success story companies. When students graduated to create a successful start-up. Yet it does is the connection between they were trained and guaranteed a job. take drive and passion and a strong team education – universities and Today, a large percentage of young people spirit. It also needs committed clients: any Oyoung graduates – to local companies, cannot get a job at all! venture is far less speculative if there is a that is universities with their partner com- My approach over the last 20 years has clear client need being addressed. panies. Until about 50 years ago in Wales, been to help young graduates create their Recently I established a new vehicle to there were many centres of Further and own companies instead – their own jobs build closer relationships with universities. Higher Education that focussed on the in fact. My first company was started with The Alacrity Foundation is located here in needs of the main local industries: coal $4,000 and grew to have a turnover of $1.5 Wales as well as in North America. It was mines, iron and steel production, non- billion. The lesson there is that it often set up to connect graduate entrepreneurs

12 FST JOURNAL >> MAY 2014 >> VOL. 21 (3) stimulating growth with known client requirements, i.e. frequent traveller to the USA, South areas where there is a potential for strong Sir Terry Matthews America, Europe and Asia. I see the customer pull. That significantly reduces OBE FREng is emergence of high-growth companies in time to market for a product or solution Chairman of China. I am aware of what is happening because of the focus provided by the Wesley Clover, in the wider world around us! To be client. The business has a much greater an investment successful, businesses have to be aware likelihood of success as a result. management of client requirements, and of emerging The Alacrity Foundation also provides firm and holding trends. In my area, Information and company. He has start-up companies with access to mentors Communications Technology (ICT), the founded or funded more than 100 who provide them with credibility, and changes are coming thick and fast. companies, including Newbridge this helps build relationships with clients. Networks which became a leader Rapid change offers the greatest Credibility is a vital ingredient in business. in the worldwide data networking opportunities, because when there is no Start-ups need business from clients but industry. Sir Terry is also Chairman change, the incumbent product or service have no track record to show what they of a number of these private provider has an inherent advantage with have done or whether they will be around and publicly traded companies, all the clients. It is only when there are in a year’s time. including Mitel, Solace Systems and significant, disruptive changes that the I am a big believer in internships Counterpath, and he sits as a Director market opens up. or, as we used to call them, ‘sandwich on the Boards of several others. Right now, in many areas of ICT, there courses’. Typically that was how the is a great deal of change worldwide – it is HND, HNC qualifications and so on like going into a sweet shop with all these were structured; it was a very good with also get paid less than they might different opportunities! Currently I am programme for educating young people find elsewhere. If they could be getting involved in setting up four or five new about business. That approach seems to £30,000 a year, I might only pay them companies a year. They are all extremely have been lost in our current education £15,000. The difference is made up focussed. They are made up of new framework. I would like to see it make in their part of the ownership in the graduates. And let me tell you, most start- a comeback. company when it is formed. Typically, ups are not short term ventures. While So, the Alacrity Foundation assists after one year the graduates own 40 per it might take a year to a year and a half universities in placing students in cent of the company – if it takes two years to come out with a product, it takes on targeted industries and partner to develop the solution they will get less average seven years to achieve sufficient companies. By virtue of the Wesley ownership because I have to spend more success to realise a return on the capital Clover network, it also gives these money getting there, but it is a model I investment, through a public offering or students opportunities to go to other have had great success with. an acquisition. countries as well, like North America, After a year in these start-ups, the But these talented youngsters are out France or Germany. This exposes them young entrepreneurs become strong, there, and they have to fight hard for to the experiences of global markets. work-hardened, ready to take on anybody: success in today’s global environment. Our universities produce really good they have ownership, they fight for their It may not be ‘fair’ that people in China graduates. I know, we actively embrace companies, they fight for their products. or India get paid less than we do here, them. In Wales, and elsewhere in the Success, after all, is not measured in and so have a cost advantage in terms UK, we have very innovative young the amount of hours put in, it is about of creating and building products, but people. What is lacking is a more effective commercial success – the amount of sales, that is business today. Yet the combined way to commercialise their insights, to and they develop a keen appreciation for population of those two countries is 2.6 take their ideas – and the innovative that. billion people – a huge market that we too people themselves – and turn them into If society cannot take these young, can fight for! businesses and business people. How can well-educated people coming out of Those that have been in business for a this gap between idea and commercial universities and turn them into the next long time, or have experience in some of reality be crossed, since it seems to be generation of business people, where is the the supporting professions, can also make inherent in the society? The problem future? If we want a prosperous future we an important contribution to encouraging is certainly not a matter of work ethic – must have successful businesses. These business growth. They can set aside some these people work incredibly hard. are the businesses that grow and hire more time to help youngsters like these become One approach which I have found to people and pay taxes and provide ongoing the next generation of business people be successful is to provide ownership in employment. How else are successful more quickly and more effectively. That the business – a different approach from businesses to be created? is my model. We have innovative people most companies which just provide a I go to China four times a year and – let’s help them to become the next salary. The new graduates that I work to India four times a year. I am a very generation of business leaders! ☐

Addressing the meeting, Edwina Hart MBE CStJ AM, the Minister for industry. She argued that there is a duty for Government, the HE Economy, Science and Transport in the Welsh Government, noted and FE sectors to look very closely what industry actually requires that the country had plenty of innovative young people, but the – not just core skills but also the specialist skills needed by the challenge was to turn that talent into real businesses. She agreed market. Governments must be prepared to take bold steps in on the importance of tackling youth unemployment and stressed supporting research and innovation, and be prepared to accept a how the Welsh Government has invested in apprenticeships because proportion of business failures. She acknowledged that this might they are the way of the future. The Minister added, though, that not be the traditional approach but it is the one needed in order to there was also a challenge in making graduates fit for purpose for support entrepreneurship in today’s business environment.

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Professor Jeremy Watson Patrick Kniveton FIMechE Professor Tim Broyd FREng Professor John Uff CBE QC CBE FREng FIET is Vice- FIET is President of the FICE is Vice-President of FREng FICE is a barrister President and Trustee Institution of Mechanical the Institution of Civil at Keating Chambers. He of the Institution of Engineers. Engineers (ICE) was a panellist during the Engineering and Technology discussions after the formal (IET). speeches.

Can Learned Societies – and particularly those in the engineering sector – act as catalysts for economic growth? This issue was debated at a meeting of the Foundation for Science and Technology held at the Royal Academy of Engineering on 24 September 2013. Raising the bar

here are a significant number of President , the Institution of Engineering is not formally part of the mission Learned Societies representing and Technology, described the current of any of them. Although, as Patrick the engineering sector, brought landscape in which engineering – Kniveton noted, the first President of together collectively under two and its learned societies – operates, the Institution of Mechanical Engineers, Tother bodies, the Engineering Council saying: “Engineering contributes £481 George Stephenson, had stated in his and the Royal Academy of Engineering. billion to the UK economy, employs Presidential speech of 1847: “Unless Professor Broyd for the Institution 5.4 million people across half a million the talent of England was concentrated of Civil Engineers, Professor Watson engineering companies and is key to it was not unlikely some of the for the Institution of Engineering and the commercialisation of research and continental talented men might take Technology and Patrick Kniveton development leading to new products part of the business of the Country ...” for the Institution of Mechanical and services, new industries and new So the threat of foreign competition was Engineers each explained the historical jobs. However we still need to attract acknowledged from the outset. development of their organisations and a greater talent pool into engineering, A key role for individual bodies is how their founding visions had led to with joined-up action to ensure we in setting and enforcing standards for their current role and focus. seize the opportunities at a national and various grades of membership as well Patrick Kniveton, the President international level (we need 1.25 million as fostering continued professional of the Institution of Mechanical science, engineering and technology development and upskilling. As Engineers, explained the purpose of professionals and technicians by 2020).” Professor Broyd noted: “We help the engineering institutions in the economic growth by providing a set words of George Stephenson, in the Growth of standards for civil engineers and founding statement of the Institution: Yet while their members will all be civil engineering. Individual people, “To enable Mechanics and Engineers focussed on growing their businesses individual companies will be working, engaged in the different Manufactories, both in the UK and abroad, growth hopefully, above those standards, Railways and other Establishments in the Kingdom, to meet and correspond, and by a mutual interchange of ideas DISCUSSION respecting improvements in the various Official support for innovation branches of Mechanical Science to There is an important difference in practice between Europe and the USA. increase their knowledge, and give an There, Government procurement policies ensure that valuable contracts are impulse to inventions likely to be useful awarded to companies whose innovations have received Government assistance. to the world.” He stressed the continuing However, this is not possible within the EU where public purchasing rules - public relevance of these words, and especially procurement above a certain threshold requires a competitive bidding process - the final phrase regarding ‘inventions likely to be useful to the world’. precludes the adoption of such a desirable policy in the UK. Professor Jeremy Watson, Vice-

14 FST JOURNAL >> MAY 2014 >> VOL. 21 (3) learned societies but we will provide a baseline set of understandings.” In terms of setting and upholding Engineering the Future standards, Professor Uff noted that one role of every engineering institution is The engineering profession has formed an alliance, Engineering the the drawing up of a Code of Professional Future, to strengthen engagement with policymakers and support a or Ethical Conduct and the putting in thriving economy based on wealth creation and prosperity through place of mechanisms which protect the engineering innovation. With a combined membership around 450,000 interests both of its members and the public. He recalled that this aspect came engineers, Engineering the Future is a broad alliance of professional into sharp focus in New Zealand as a engineering institutions and associated bodies. Leadership is provided result of the Canterbury earthquakes by a core group of institutions: the Engineering Council; Engineering in 2010-11 in which an inadequately UK; the Institution of Chemical Engineers; the Institution of Civil designed building collapsed killing 115 Engineers; the Institution of Engineering and Technology (IET); the people. The CTV building had been the subject of a report more than 10 Institution of Mechanical Engineers; the Institute of Physics; and the years earlier which had revealed the Royal Academy of Engineering. inadequacies. The author of the report had followed the existing professional Engineering the Future also draws upon the expertise of Education for code but the report became “lost in Engineering (E4E), the body which represents the engineering profes- the system” and the building remained sion on education, training and skills. a major risk. The report of a Royal Commission should, he added, cause all www.engineeringthefuture.co.uk engineering institutions to review the adequacy of their own procedures.

Liaison Watson argued that, at the UK level, China account for a mere 5 per cent The Learned Societies have an important it is growth in the medium-size of global middle class consumption, role in liaising with Government and businesses that will make the big while Japan, the United States and the other bodies involved in engineering. difference to employment (because the European Union account for 60 per While not ‘trade bodies’ who lobby for vast majority of people are employed cent. particular outcomes or projects, they are in such businesses). Patrick Kniveton “By 2025, those numbers are able to provide impartial, independent, also stressed the importance of small expected to equalise. By 2050, they expert advice. This is sought not just and medium enterprises (SMEs) to will have flipped. Supporting economic by Government but by many other the economy and the crucial need for prosperity is not the only crucial role interested bodies such as the Research actions and policies to enable SMEs to the engineering sector has to play in our Councils. grow. f utu re .” To maintain close links with A further essential item for the Government, many of the larger Building links Learned Societies and their engineering learned societies in the engineering In an increasingly global market, the members is public engagement. sector maintain London headquarters, societies need to build wider links If engineering is to transform the although Professor Uff questioned too. Professor Watson noted: “reports economy, then it can only be done when whether that was necessary in today’s project that annual global output will the public understands the benefits to world especially given the location of more than double in two decades, from be gained from training and employing members. But having a London HQ $78 trillion to $176 trillion. Three-fifths a new generation of engineers. Patrick does not mean that the societies are of that extra output will come from Kniveton concluded: “True change London-centric. Referring to the ICE, emerging or developing economies. The comes however when the 93 per cent Professor Broyd noted: “We also have force behind this growth is the growing of the UK population who are non- a very vibrant and active network of purchasing power of the middle classes, engineers and non-specialists start to regional groups throughout the UK – it particularly in Brazil, Russia, India and take an interest in what we say. The key is amazing how forthright members can China (the BRIC countries) and other is to talk about what interests them and be if they think things have become too emerging economies. Today, India and not just tell them what interests us.” ☐ London focussed, especially if they are in places like Scotland and Yorkshire, for example!” DISCUSSION Professional organisations such as Reaching out to schools the ICE, IET and IMechE make a very While a greater awareness by Government and the public of the importance important contribution in providing of engineering is welcome, more can be done. In particular, it is important a neutral ground where business to encourage more women to enter the profession; there are still far too few discussions and strategies can form in a female chartered engineers. This might be helped if learned societies actively way that complements those generated on a direct company-company basis. welcomed teachers into their membership and actively encouraged engineers to This is particularly important for the enter teaching – they are much needed. medium size businesses. Professor

FST JOURNAL >> MAY 2014 >> VOL. 21 (3) 15 digital participation

The Royal Society of Edinburgh has completed an inquiry into digital participation. A meeting of the Foundation for Science and Technology held in Edinburgh on 13 October 2013 explored some of the issues being considered in the inquiry which, while focussed on Scotland, has general implications. How can the benefits of digital access be made available to everyone? Alan Alexander

he first point to make about for other reasons. A report by Carnegie digital participation is that Professor Alan on digital non-participation in Glasgow infrastructure is not enough. Alexander OBE pointed out the impact of multiple The Royal Society of Edinburgh’s FRSE is General deprivation. The four areas of lowest Inquiry into Digital Participation1 follows Secretary of the participation were the four peripheral T Royal Society of on from the infrastructure inquiry of housing estates of the city. Citizens Edinburgh and 20102. In addition to infrastructure, Advice, Scotland, did an excellent piece Co-Chair of its digital participation requires: access to Inquiry into Digital Participation. of work interviewing and surveying skills, equipment and training; effective He was Professor of Local and everyone coming into CAS offices motivation; as well as a recognition by Public Management at Strathclyde seeking advice and help in applying for all sectors that they have not yet engaged University. He was also Founding benefit over a two-week period. What effectively. Director of the Scottish Local was surprising was how high a percentage This Inquiry focussed on why Authorities Management Centre. of these people were expected to apply people and organisations do, or do not, Professor Alexander was a online yet had no access to the internet, participate. A US Congress blog called member of the Commission either because they did not have a device The Hill neatly sums up the purpose thus: on Local Government and the or because they did not have a broadband “The promise of the internet lies with Scottish Parliament (The McIntosh connection. investing in human capacity as much as Commission). He has been a with technological capacity.” member of the Economic and Social Non-participation The Inquiry has been overseen by a Research Council (ESRC) and of the The reasons for non-participation are broad-based committee. It has collected Accounts Commission for Scotland. well known: and collated evidence from Scotland and • lack of access; elsewhere. It has carried out a number digital inclusion. • lack of equipment and the current of consultations with follow-up round- cost; table discussions in a number of cases. Infrastructure • lack of skill – not knowing how to use The committee collected opinions, gripes While infrastructure is not sufficient to the technology; and case studies, some of which appear ensure digital participation, it is certainly • lack of motivation. in the final report. There has been an a necessary condition. Yet there are remote emphasis on vulnerable and excluded areas which still are waiting for reliable The last of these is difficult to tackle. There groups largely because, prima facie, they broadband. There is a problem, too, with are many factors affecting motivation and could benefit disproportionately from percentage targets. If the target is 80 indeed confidence. A significant issue engagement. per cent, that means 20 per cent are left involves fear and risk: what will happen The committee has been acutely out. Percentage targets also tend to push if I make a mistake, what will happen aware of the value of clearly-targeted providers towards the low-hanging fruit. if I put information online but people recommendations which explain what A further issue is how to increase steal it and use it for nefarious purposes? needs to be done and sets out who needs participation in areas which have good Media headlines do nothing to dispel to do it. infrastructure available but low take-up those fears. Now, while risk cannot be The Inquiry’s agenda is wide- ranging. We want to understand what different people and groups mean by ‘digital Scotland’. We want to explore the Digital Scotland dividends for various sectors of society. This Inquiry builds on the Royal Society of Edinburgh’s Digital Scotland report. That We want to see what is happening to concluded that Scotland must aim for broadband speeds of at least 16Mb/s by 2015, the digital divide. We want to be very and should establish a Digital Scotland Trust to deliver and operate a backbone clear about digital inclusion – why it is fibre infrastructure to bring high speed broadband to all communities. The issues so important, how it can be encouraged. were discussed at a meeting of the Foundation on 28 October 2010. A report on the In addition, we want to identify the debate can be found in FST Journal Vol 20 No 6, which can be accessed at: role of society and the state, including www.foundation.org.uk/Journal/Default.aspx Government institutions, in encouraging

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DISCUSSION typically for a maximum of four hours Online access for the disabled per day, 35 weeks of the year. Yet no education authority in Scotland allows The public sector does not always demonstrate a thorough understanding of public access to school computer suites. the problems of the disabled in using online services. There is, too often, a There are many reasons for this, but the lack of coordination – one might start off online, but then there are complex fact remains: these public computers are forms to fill in on paper, or a supplementary visit has to be made to an office inaccessible to the public. to verify identity. There is plenty of scope to allow voluntary bodies to explore In Scotland we aspire to universal alternative ways of engaging particular groups of disabled in online services. digital inclusion. To foster this, greater Simpler technology is essential, though: instructions must be accessible, legible public access needs to be achieved and and understandable. Local authorities need to be much more imaginative in the schools seem to be the most obvious use of public space for online purposes. option. In addition, if the digital divide is not to persist, there should be a target that minimum broadband speed should be 25 eliminated it can be managed and society Beyond the main urban areas per cent of the median (and that target needs to help people to do just that. of Scotland, there are many small should be maintained as the median rises). Access has to be ensured for everybody. communities whose very survival depends People go online for a wide variety This includes the itinerant and the on small businesses continuing to trade, of social and cultural reasons. They homeless because they will have to apply continuing to succeed. Yet, it is precisely participate because they are motivated and online for benefit within the next few years. the very small businesses who are least do not if there is no incentive. There is That necessitates a clear policy about the engaged and have very low understanding therefore a need to discover what motivates provision of secure places in public spaces of the benefits of the digital age. A way particular groups of people to participate. where people can access the internet. has to be found of showing them the Bad experiences can produce fear, which There should be learning opportunities advantages to be gained. is a ‘negative motivation’. Transparency for individuals (and businesses) because Many small enterprises have an and clarity about how data is used and one thing that is quite clear is how inadequate understanding of the costs, stored can help reduce that fear. the learning process accelerates once risks and opportunities associated with My colleagues and I on the Inquiry started. Tell an elderly person that she going online. They think it is much more do not believe that the Scottish education can talk to her grandchildren in New expensive than it is in reality and they system has yet caught up with the digital Zealand by Skype and interest will be believe that they are expected to compete revolution and we perceive a lack of awakened. Other opportunities can then with Amazon if they go online. Even if coordination of training initiatives. be explored. they just use email or get themselves onto So, there is a need to provide basic The digital dividend needs to be better an online map, they can start experiencing understanding and skills, via a joined-up demonstrated. Online participation the benefits. There is an urgent need for approach by training providers. SMEs promises: efficiency savings, especially tailored entry-level courses for businesses. need peer-to-peer support so that they can for the public sector; a reduction in learn from those who are already on the healthcare costs; better education and Public access to public computers path. And we believe that a ‘trusted trader’ employment outcomes; as well as the The Inquiry found that one of the approach, a sort of Kitemark for service availability of a wider range of goods at most likely places for people to find providers (to give newcomers to the digital lower prices. public access computers is in libraries. world the confidence that they will not get Unfortunately, the number of libraries ripped off) will help some businesses and Communities is reducing significantly, meaning that individuals take the plunge. ☐ Digital participation can make a huge provision is becoming increasingly sparse difference to people and communities and involving longer journeys. However, 1. www.royalsoced.org.uk/1058_ that experience isolation. It can help in every community there is another suite SpreadingtheBenefitsofDigitalParticipation. enable independent living for an aging of publicly-owned, publicly-financed html population, and foster social inclusion for institutions. These are in schools. 2. www.royalsoced.org.uk/886_ scattered minorities. Computers in schools are used DigitalScotland.html A role for local government in delivering the digital agenda Lorraine McMillan

n response to The Royal Society the start of 2013, with implementation Scottish Government – a broad mix of of Edinburgh’s earlier inquiry into now taking place. The Board includes people. public sector digital infrastructure, Chief Executives of Councils, senior ICT in local government faces three a Local Government ICT Board IT managers, Scotland Excel (the local main pressures in Scotland and these link Iwas established to provide leadership in government procurement organisation), to the participation agenda. this area. A strategy was launched at The Improvement Service and the The first is cost. Budgets are declining,

FST JOURNAL >> MAY 2014 >> VOL. 21 (3) 17 digital participation in real terms at least. So there is a Poverty requirement to find ways in which IT Lorraine McMillan Digital access can be used to address can reduce costs in the public sector. is Chief Executive of poverty. Take young mums who have Customer expectations, however, are East Renfrewshire a child at 16 or 17. Most of them use rising. People want to access services 24 Council. She digital technology; they have been using hours a day, seven days a week. This is joined the Scottish it at school and they now have access to a Development coupled with an increasing demand for phone. Most of them are on Facebook. In Agency in 1989 public services in general. For example, the Netherlands, there is a scheme which specialising in people in East Renfrewshire enjoy some uses phones to access videos of good technology transfer. She then of the longest lifespans in Scotland – so went to Scottish Enterprise parenting techniques such as how to hold the area now has one of the fastest- Dunbartonshire in 1991, becoming a baby correctly. The young mums would growing over-85 age groups. Many of Director of Enterprise and then Chief not have gone to a parenting class, but if these people are still living independently Executive of Scottish Enterprise their health visitor showed them how to but they need some support. This offers Renfrewshire. As well as her East hold the baby correctly and they could see great opportunities – and demands – for Renfrewshire Council role, she leads it on video, they will make use of it. digital technologies. on the implementation of the Local There are challenges, though. There Government ICT Strategy, focussing is a move in schools to ‘bring your own Digital Scotland on getting more services on-line, device’. While children and young adults The vision of the national strategy Digital reducing costs and enabling reform will be using computers in every class, Scotland is to encourage people to access across the local government sector. they will no longer be going to a computer services online. The Local Government class as such. Now, when children start Board’s strategy contributes to this and to bring their own device there are a has three goals. More services are to association is putting wireless into three number of security issues which have be delivered online, the public sector tenements so that people can access it. to be addressed. In addition, in some should shape the delivery of this change While poorer residents may not be able to areas they will have iPads and computers and costs have to be reduced. We are afford a landline (£16-£17 per month plus and all sorts of phones but in the more working in partnership with Scottish broadband), it is possible to get a pretty deprived areas those devices will not be central and local government as well as good mobile contract for £10 per month available. Equally, a child may not want the NHS. which includes access to the internet. If to bring their device in because it is not We want more people to use online the wireless infrastructure is in place, as good as somebody else’s. So there are services, but should that be offered as people can then take advantage of online many challenges for digital inclusion in ‘digital by choice’, ‘digital by default’ or services. education. ‘digital first’? Scotland is adopting ‘digital There is good use of ICT facilities first’ which means that, while people will in libraries. Some people use libraries Rural areas always be offered first a digital service for access because they do not have a The national broadband initiative will wherever possible, there will always be device at home. East Renfrewshire has give 85 per cent of Scots access to fast alternative means available for those who a very wide training programme in its broadband although in some remote cannot access them digitally. libraries, so no matter what age a person rural communities, people cannot access There are wider pressures associated is, they can get training in how to use the broadband at all. Yet people can be with the Digital Scotland programme: internet. In poorer areas, libraries are extraordinarily innovative. There are cities need to be connected, there is an packed with people doing just that. numerous accounts in the media of economic imperative to be at the forefront People used to go to the library for a people in Skye and such places running of technologies. The country has top reference book, now we use the computer really amazing businesses and finding level universities, but for the future of the for reference – the same thing, just ways to access broadband. economy it needs students with excellent delivered in a different way. digital skills. So schools and nurseries are There are free wi-fi zones in a number Aging the real places to start that journey. of public buildings, one in a park! It is Local councils have a duty to look after There are four areas where we are actually inside the pavilion but the signal residents with disabilities and we are focussing our efforts on encouraging is so strong it can be accessed outside starting to see digital as an enabler rather greater participation: as well. than a disabler here. For older people, • poverty; • access in rural areas; DISCUSSION • disability; Digital education • age. Local authorities can be too optimistic about the effectiveness of digital My own community, East Renfrewshire, teaching in schools. There is some excellent teaching, but the use by children of is generally fairly wealthy, but there are computers is often more sophisticated than teachers comprehend – and in some pockets of quite extreme deprivation and schools equipment is outdated. Good practice needs to be shared to ensure that poverty. These contrasts have to be taken best practice is understood and implemented throughout the country. An overall into account in the roll-out of services. director for digital education for all schools should be considered. School online Digital access is just not affordable for equipment should be available for public use. There may be some contractual some. and safety/security issues, but these are the sort of challenges which imaginative Yet innovative thinking is breaking planning can overcome. down barriers. In Glasgow, a housing

18 FST JOURNAL >> MAY 2014 >> VOL. 21 (3) digital participation there is Telecare, where they wear alarm just like Skype I use to contact my grandson it is possible to make adjustments so that the buttons in case they fall or are injured. in Australia.” In fact, the age group least technology becomes more accessible. This is now being linked to their smoke able to use digital are the 50 to 60 year In conclusion, it is important not to alarms as well which means the call centre olds because they are too proud to say they put people into arbitrary categories: the can intervene to find out if they have burnt cannot use it: so they say it is not suitable. poor are not always excluded – some are the toast or have a fire – in which case When someone says the organisation or but others are not. The public sector has fire and rescue need to be called. That the community ‘is not ready for it’, they a specific role in ensuring that people are is really, really important. The plan is really mean they cannot use it and they enabled. to extend this initiative to different sorts have a real fear of it. Local government can make a whole of sensors, enabling people to prevent or One of the issues, for older people, is raft of initiatives available through local manage chronic illnesses while remaining getting devices that do not break. My 85 libraries to help people participate. The in their communities. year old father-in-law has started using an biggest enabler, though, is the school. I While age is an issue in terms of digital iPad. He has never sent an email, he has hope that every child in East Renfrewshire participation, it is not always the oldest never been technically trained, but iPads leaves school with very strong digital skills. people that have a problem. I remember work for him, because we told him ‘you The digital skills of our primary students hearing about one elderly lady who was can’t break it’. It is also good because he can are vastly superior to my own. Teachers are being shown very slowly how to use change the font size – his sight is not good really keen to deploy new technologies and Telecare, to which she responded: “This is and his hearing is not good, but with an iPad, they must be supported in that. ☐ Representation and identity in a digital world Alan Blackwell

n talking about digital participation, Representation Dr Alan Blackwell there are several key issues. How Colleagues in Cambridge are creating a is a Reader in can a digital infrastructure allow a Interdisciplinary system called Africa’s Voices – it is quite a more effective delivery of services? Design at the simple model. A single laptop computer IThen, how does participation affect Computer is given to a radio station in an African representation in a democratic society – Laboratory in community and connected to the network because it seems to me that the nature of the University of so the laptop can receive SMS messages. our society and our democracy is changing Cambridge. He The radio presenters often discuss local due to technology? There is also a need to developed and teaches a design government issues and policy. The consider the way in which young people curriculum for computer science community does not have internet access can construct their identities through students in Cambridge, and but it does have mobile phone coverage. digital – digital is becoming a means of supervises design research students Listeners can contribute to the public participation and self-realisation. in architecture, engineering, debate via SMS messaging. In addition, psychology and music. He is a these responses can be compared to the Service delivery Fellow of Darwin College, Vice same debates being held in another eight Taking a wider – in fact, global – perspective President of the Cambridge countries across sub-Saharan Africa. on service delivery, the GAVI alliance, Philosophical Society, a Director In this example, there is no digital funded by UNICEF, the World Health of Cambridge Enterprise, and deployment at all, but there is participation Organisation (WHO), the World Bank and Co-Director of the Crucible nonetheless. By collecting large amounts of the Gates Foundation, aims to vaccinate Network for Research in data, collating and analysing it, government Interdisciplinary Design. Photo every child in the world. So far they believe services can be developed to respond to the courtesy Image Services, Victoria they have vaccinated about 100 million, needs of disenfranchised communities. University of Wellington but the problem is that they cannot be However, there is a problem here: this sure. This is because, with a very complex process is not democratic. This is just about supply chain, they do not have the data does not come from nowhere, it is part of crunching numbers and seeing what comes to verify their estimates. Their service is the infrastructure behind service delivery. out. We need a new kind of journalism underpinned by substantial layers of inter- And when people connect online, they are communicating information about public connecting infrastructure and the relations linking to a large infrastructure that often data to their audiences. Indeed, we also between them are not always clear. They takes them away from participating in local need new kinds of scientists, new kinds of drop off huge vaccine containers at airports organisations. public analysts too. but have very little knowledge about what My parents in New Zealand use People involved on initiatives goes on after that. They came to Cambridge web-based services to talk to their like Africa’s Voices are committed to for help because, they had concluded, “what granddaughter. Once again, there is a great ‘deliberative democracy’. Big data has the is needed in order to finish the job is data”. deal of infrastructure behind that – and it tendency to anonymise information and Many people now do their grocery is not neutral. Huge conglomerates like to deal with people as ‘averages over a shopping online with the produce being Apple, Google and Android lock customers population’ – it is actually less participatory delivered to the door by van. Yet the van into large industrial complexes. than the democracy we already have with

FST JOURNAL >> MAY 2014 >> VOL. 21 (3) 19 digital participation

DISCUSSION build the world as you play it. The Swedish Making connections authors of Minecraft are enthusiasts for the Open Source movement, so many players Full digital participation can connect people and bring them closer together, will actually download the source code and creating communities and in turn reducing isolation and exclusion. Trust grows write their own programmes: in this way if people work together; their fears of risk are reduced. The development they change the way the game works. of online communities could also affect the relationship of individuals to Because of the democratic nature of government. However, special interest groups would have to ensure that they building your own world, people use it were not just representing the views of a small but digitally-literate minority. to explore different kinds of world. And Conversely, those who might not otherwise have the means to object to a policy young people are very interested in may find it easier to express concerns. No doubt a rolling referendum on every subverting conventional media holders. A policy would be problematic. It is an open question whether democracy would group of students have made a version suffer or benefit from universal digital participation. of the Hunger Games in Minecraft with the same characters so they can act out the movie by themselves. There is also a Minecraft version of Farmville, which is a local newspapers and local radio stations. it for their own use. Facebook add-on. The next questions is: into whose hands The BBC has, in the past, developed There are, then, technologies that should all this data be entrusted? People are digital tools for people to create their own enable our young people to be creators, not becoming very nervous about the fact that content. The BBC Micro kick-started a just consumers. People can take ownership their data are being collected and passed whole industry. Today, there is a new of digital technology by making it to suit on to people who may not have their best generation device called a Raspberry Pi. It themselves. However, it is by no means all interests at heart. Perhaps what is needed costs £25 and provides a computer which good news. is, instead of surveillance, ‘sous-veillance’: can be given to children (or adults) and Many of the developments that the people under the system should be used to make content. empower people are challenging corporate able to look at those making the rulings The challenge is to enable content interests, media interests and intellectual and then make their own interventions that would be as satisfying today as that property (IP) interests. Large corporations and reversals. Maybe the security cameras produced with a BBC Micro 25 years ago. and the digital providers are not providing should be inside the Council Chambers Nowadays, even relatively low-income services that deliver rewards to the people rather than outside? households have access to X-Boxes and who make a creative and inclusive society. Playstations where they play complex The large established players are not Self-realisation visually-appealing games. Even with all encouraging people to create their own There is a village called Budikote in India the marvellous things packed into the content. which has a village radio station. However, Raspberry Pi, it is not possible to play a A key question, then, is: alongside this does not broadcast via radio waves: game like Call of Duty. creating an infrastructure for digital instead, there are speakers in the trees participation, how do we create or revise which carry the output to the community. Where to from here? legislation to remove embedded obstacles So this is far from any digital infrastructure. There are, however, some bright signs for to participation in our existing networks? A group of British workers have helped the future. As one example, the Minecraft Service delivery is important but it them connect to the internet and make use game is not as high-resolution or violent as needs to take account of self-determination of some of the digital devices that allow Call of Duty. It is a relatively simple game alongside infrastructure. Representation people to create programmes about their – a bit like digital Lego. Yet many children involves deliberative democracy, not just lives. In this process, the villagers were have become amazingly enthusiastic about big data. To help people realise their very ambitious. They did not want to make it and they build things in it. Players have own ambitions and identity, they must a radio programme; they wanted to put a to make tools following types of recipes – be given opportunities for creativity and video on You Tube showing what their lives you have to educate yourself in this, so you empowerment with digital technology. ☐ were really like. DISCUSSION The method was to use a very simple application – a mobile phone – because Affordability that was the only way to send data out of Questions of cost and affordability remain. While average household expenditure the village (there was no broadband nor on communications is estimated at £100 and it is consequently assumed that landline). The villagers used the camera everyone can afford a little more for broadband, the funds available per on the phone to take still pictures and then household in deprived areas is around £25 – which renders extra expenditure for put these together with a soundtrack to broadband untenable. There is scope for making tablets cheaper – Tesco now produce a really compelling video on You offers one for just £100. The public sector should be driving prices down too. Tube. This would not just help the deprived; small SMEs with low profit levels, who Media production, rather than media consumption is key to how people cannot risk expenditure without seeing a quick return, would also benefit. So, in construct their digital identities in the turn, would the communities where they are based. These small enterprises are digital world. Now the BBC is a great often based in villages where they provide employment and form the mainstay media producer and its content is largely of community prosperity. If the businesses fail, the community suffers as well. publicly-owned. There is no reason why Remote areas, and the marginal craft industries located there, are particularly people in the UK should not have access to vulnerable. that in order to change content or produce

20 FST JOURNAL >> MAY 2014 >> VOL. 21 (3) decarbonisation

The Committee on Climate Change has set tough targets for the UK to reduce carbon emissions over the next two decades. This will involve decarbonising the energy systems. The challenge and the potential solutions were discussed at a meeting of the Foundation for Science and Technology on 27 November 2013. Counting the costs of decarbonisation James Smith

limate change is a dangerous are significant sensitivities around gas threat that society needs Dr James Smith pricing. Offshore wind is estimated at to tackle. But this is not a CBE is Chairman of between £100-135 per MWh. These problem of technology. The the Carbon Trust. are estimates from the Department for Ctechnology exists to get the job done. He retired from Energy and Climate Change (DECC). It is affordable too – the cost is about Shell in April 2011 Since current wholesale prices are one per cent of GDP. Nonetheless, at a after seven years around £60, it is clear that low carbon global scale, that means spending £700 as Chairman of electricity is going to be more expensive. billion per year to decarbonise. A great Shell UK. He had worked for Shell It is not yet clear which technology in Malaysia and Brunei, a number deal of good work could be carried is best. So, option-management makes of Middle Eastern countries and out in other areas with that amount of sense as does diversification in the face on Shell businesses in the USA. In money. So it needs to be spent wisely by addition to his role as Chair of the of long term risk and uncertainty. finding the least cost routes. Carbon Trust, James is Chair of the However, we are desperately short of Advisory Board of the Grantham Systems costs versus levelised time. The accumulation of greenhouses Institute on Climate Change at costs gases in the atmosphere has to be Imperial and LSE, a Trustee of From a systems point of view, levelised reversed, quickly and significantly. Yet the Science Museum and a past costs form just one input to a more com- because of the scale and inertia of the President of the Energy Institute. plex calculation. Maximum electricity global energy system, change is not easy. demand occurs after dark in the winter. Leadership is required at individual, Electricity demand at midday in the institutional and political level, both produce the factor-10 savings by mid- summer is a lot less. nationally and internationally. century, with zero emissions by the end The problem is that the capacity has of the century. to meet the maximum demand points. A time critical problem Just as London Transport has to plan for Although the economics and science Finding the least cost pathway rush-hour demand at the beginning and of climate change are complex, the So what are the cheapest solutions that end of the day, so the electricity system arithmetic of climate change is simple will deliver the required goal? This is a must have dependable capacity for the and stark. This is an order of magnitude systems problem that requires systems points of maximum demand on a cold problem. The global economy needs to thinking. winter’s evening in January. What, then, decarbonise by a factor of 10. Broadly It is possible to estimate levelised happens to the surplus capacity during speaking, by the middle of the century, electricity generating costs. The the summer? one unit of economic output has to be operators of the new Hinkley Point In particular, if large amounts of achievable with one third of the energy nuclear station have agreed a price of non-renewable capacity (built for winter input required today and, in addition, £92.5 per MWh. Non-mitigated gas- demand) leave over-capacity in summer, one unit of energy has to be produced fired production (CCGT) is around £60 where is the need for solar power? for one third of the carbon emissions of and gas-plus-CCS about £100, but there The question is not how levelised costs today. Overall, that would decarbonise our economy by a factor of 10, the level of reduction needed. DISCUSSION However, a recent report by Price The economics of diversity Waterhouse Coopers shows that the The EU is seeking to impose a target for renewables, but this is inconsistent energy system is far from the needed with the UK Government’s belief that a technology-neutral stance is necessary trajectory. The carbon intensity of the to ensure system optimisation. The key to cost-effective carbon reduction is global economy has been declining at flexibility and diversity among fuel sources. The price of individual fuels such as an annual rate of just 0.7 per cent. If gas will vary significantly and cost changes mean that some technologies become that trend continues, the carbon budget of the atmosphere will be exceeded by less or more cost-effective. Generators need to be able to shut down plants 2034 or thereabouts. To avoid climate which become uneconomic and switch resources quickly to other technologies. damage, the rate of decarbonisation of Demand levels may be less volatile, but we need to be clearer how, in the long the global economy needs to accelerate term, they are to be managed. to 6 per cent per annum. That would

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Finding the right answer for any Technology maturity and country will involve significant, Phase market instruments complex modelling. There is also the question of who should carry out the modelling and who should make the decisions on which technologies to Technology demonstration — choose. There are a number of agencies to 2017 renewables obligation and and academic institutions who have the ‘administrative’ price setting capability, but which one should have the responsibility?

Technologies maturing – some Dealing with inertial forces 2017-2020s technology-specific auctions Looking at global analyses of energy supply, while there has been enormous growth in renewable energy sources, Growing technology maturity — 2020s this has been dwarfed by the increase technology-neutral auctions in fossil fuel usage in absolute terms. The challenge of taking early action to reduce the amount of carbon dioxide Technologies mature enough and going into the atmosphere means we late 2020s carbon price high enough to enable cannot ignore fossil fuels. competition without intervention The energy system has a great deal of inertia built into it. It takes a long time to develop, mature and deploy a Table 1. Phases of UK electricity market reform as set out in the Energy Act. Source: technology to the point at which it has DECC policy overview, Dec 2012. a material impact on the total system.

Taking a phased approach There are four phases to the innovation process – the ‘four Ds’: discovery, Systems costs for Gas price sensitivities development, demonstration, intermittency need to be added deployment. The UK is currently £/MWH in the demonstration phase for those 140 technologies that will make a difference over the next 15 years. These include 120 technologies such as offshore wind, Capex biomass, nuclear and Carbon Capture 100 sensitivities & Storage (CCS). Technologies such as marine are at earlier stages of 80 development. The Energy Act sets out a phased 60 approach and gives timescales. Low- carbon technologies in the demonstration 40 phase need financial support through mechanisms such as the Renewables 20 Obligation. As technologies mature, technology-specific auctions can be run. 0 With increasing maturity as the 2020s d . progress, it should be possible to run win Nuclear Gas CCGT Gas + CCS large sc.. technology-neutral auctions. Longer Onshore windOffshore r, Sola term, with a carbon price, investment decisions can be left to the unseen hand of the market. Figure 2. Levelised electricity generating costs, with sensitivities. Projects starting pre- There is a logic in the mechanisms construction work by 2019 (gas CCGT excludes carbon costs). Source: DECC, July 2013. that are being set up (although they are rather complex). Yet when fossil is competing against renewables it makes an awkward mixture. Perhaps a system compare, it is rather how does the total Evaluating systems costs based on Return on Investment (ROI), cost of solar compare with the cash cost The solutions to systems costs evaluation offered on a competitive basis as they of running that idle capacity. Load will vary across the globe. In Japan or do in some parts of the USA, might be shifting and energy storage also come Texas or Southern California there is a a better means of ensuring we get the into the overall systems evaluation, huge electricity demand at midday for right sort of systems outcome. This may though. air conditioning, when solar is at its best. be a mechanism for the future. ☐

22 FST JOURNAL >> MAY 2014 >> VOL. 21 (3) decarbonisation Creating an affordable energy system for the UK David Clarke

lectricity demand goes up and Capture & Storage. To deploy CCS, there Dr David Clarke down over the course of the will need to be a CO2 pipeline network year. UK generation capacity FREng is Chief across the UK. If the current plan is to is currently about 94 Gigawatts Executive of build power stations with fossil fuel supply E(GW). Yet electricity is only part of the the Energy in the middle of the UK, the pipeline will equation. On one Saturday morning (16 Technologies have to extend all the way to the coast and December 2010), heat demand went up Institute. Previously beyond. It might be more sensible to site by 132 GW in one hour as people got up he was Head of the power stations by the coast in the first Technology Strategy and switched on their gas boilers all at the place. at Rolls-Royce plc. He has been same time. The electricity network could Then there is innovation which needs involved in collaborative research not have coped with such an increase. It to be applied across all the technologies and development of advanced might be possible for it to do so one day: technologies for over 20 years. to improve performance and reduce costs. the pumped-storage plant at Dinorwig in At Rolls-Royce he led a range of Finally, there needs to be some innovative North Wales can deliver the ramp-up rate technology groups including their thinking about business models to make but the system would need 100 such plants Advanced Materials development sure that they too are optimised to deliver to deliver the power requirement. activities and the corporate value from the system. How much should the UK pay to Strategic Research Centre. He is meet carbon reduction targets? Most a Board member of the SPECIFIC Planning for the future commentators agree that it should be Innovation and Knowledge Centre. Take two very different scenarios of what ‘around 1 per cent of GDP’. I would add the future might look like. In the first, the a caveat: if the systems are not optimised, UK works to achieve an 80 per cent fall in then that number does not just creep up, it generation is not sufficient to create a cost- emissions by 2050. In the other, no target doubles immediately. optimised approach. is set other than building the lowest-cost ESME is a tool which gives robust, system for the country’s energy needs. System basics evidence-based assessments to the question The ESME model suggests that the There are a number of factors that all of how much it costs to decarbonise the likely resulting systems start to diverge in contribute to the development of an UK’s electricity supply. Among the items the early 2020s. By 2050, in the ‘80 per energy system for the future in the UK. that recur time and again as preferred cent reduction’ scenario, there has been First of all, there needs to be an adequate solutions from the ETI modelling work extensive construction – some 140 GW understanding of the drivers for this kind are: nuclear; CCS for both fossil fuels and of generation capacity (compared with of development, in terms of costs, supply biomass; offshore renewables; bioenergy our current 94GW). With no targets, capability and capacity, infrastructure needs feedstocks; gas; and improvements in generation capacity actually reduces to and investor requirements. There must efficiency. Broadly-speaking, these are ‘no less than we have today. So there is a be clear market and value opportunities regrets’ choices for the next 10 years. They big difference in capacity requirements in for investors and consumers, as well as a deliver benefit at relatively low cost in the these alternate futures. supportive and stable policy environment. short term, almost irrespective of the likely The ‘no targets’ 2050 world is very One factor that is often left out of long-term energy future. straightforward: fossil fuels are the consideration is consumer support. Yet However, to deliver these six items in cheapest, most widely available resources this will be crucial for whatever plans are the most cost-effective way and contribute and they give security in terms of diversity adopted. A lack of support can eliminate to our energy future, the system has to of supply. In a world of targets there is technologies overnight – nuclear in Japan, be optimised around them. This leads more diversity is efficient: fossil fuels with Carbon Capture & Storage (CCS) and on to thinking about how to create the CCS; a large tranche of nuclear power; nuclear in Germany, etc. infrastructure that supports this. hydrogen; and renewables. Critically, in If the system needs to accommodate The easiest example to give is Carbon this picture of our future, CCS and nuclear different options, it needs to retain that

flexibility as the programme moves DISCUSSION forward. Also, there must be innovative Public awareness — or ignorance incentives for industry to actually invest in the UK – and not just Government Consumers may not be willing to accept the costs associated with the carbon subsidies. targets - even if these are as low as 1 per cent of GDP. There may be a need The Energy Technologies Institute has for carbon reduction, with dangers from increasing emissions, but the public do built a tool called ESME – Energy System not see the urgency in cutting back now. The public understanding of risk has Modelling Environment. The critical always been poor. Climate change is not seen as a crisis, to which people have thing about this is that it integrates future to respond by action. Rather it is dismissed as something which might happen development of power, heat, transport and sometime in the future. infrastructure. Looking just at electricity

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Maintain… of technologies which, to all intents and (NHS >£100bn p.a.) and plan again purposes, have a ‘zero carbon price’ to be (MoD >£40bn p.a.) cost effective – energy efficiency, energy 30 +£35bn p.a. storage, biomass for heating. There is then a further group which, with a carbon price of between £30-50 per tonne, become 20 viable. Big asset plants – nuclear, CCS, Build bio-energy for power – start to fall into +£15bn p.a.

£bn/year that bracket. Transport 10 Offshore wind, marine technologies Prepare and electric vehicles need much higher Schools HS2 +£5bn p.a. carbon prices to make them cost-neutral, or industry must find a way to drive 0 2010 2015 2020 2025 2030 2035 2040 2045 2050 costs down. For offshore wind, the ETI is looking at long blades and floating Figure 1. Incremental capital investment in energy infrastructure platforms, which should bring the costs down to levels that would be compatible with nuclear (around £50 per tonne of are the mainstays of electricity supply. and CCS and they must be part of national carbon, perhaps a little higher). policy programmes. There is also a cost Cost-reduction is not the only challenge Making a choice associated with delay: a five-year deferral facing low-carbon energy, though. Look Until about 10 years from now, the two of nuclear and CCS would add about £5 at the current debates about CCS – these paths look quite similar, but from the mid- billion per annum to overall system costs. revolve around investor confidence. The 2020s they diverge. So there is a decision to investment community needs to become be made within the next decade. Of course, Capital costs comfortable with the scale of the investment the reality is not likely to be so black-and- To create a system which will deliver 80 per and the potential returns of some of these white, it will probably lie somewhere in cent cuts in emissions, capital expenditure major technologies. between these two scenarios. would probably come in at about £5 billion Then there is the business model. For the low-carbon route, there are a year until the mid-2020s (Figure 1). Even for efficiency in buildings, it is still additional costs in implementing CCS, After that, it rises to about £15 billion and a struggle to get consumer pull. Energy nuclear, offshore wind, improving building with a final roll-out of infrastructure in the storage at a distributed scale does not yet efficiencies, etc. If we do all of those things, 2040-50s, it increases further to around £35 have a market mechanism to incentivise it. in an efficient but practical way, we are billion a year. What then needs to happen over the likely to see additional national costs of The initial costs to 2025 are relatively next 10 years? It is vital to keep options around £300 billion between now and 2050 small when compared with other open on the future delivery of electricity. – the extra 1 per cent of GDP often quoted Government commitments such as Government, industry, finance, academia, as the cost of meeting the UK’s 80 per cent the Health Service or Defence but the all have to work together to identify the

CO2 reduction target. long-term annual investments levels are right options and associated costs. The However, the ETI’s model allows us comparable. levels and timings of investment need to be to calculate the impact of different policy Innovation can play an important role understood. Critically, though, the initial decisions regarding technology choices. in mitigating these higher costs. Validating costs over the next decade are relatively Take out nuclear and it is likely to cost and implementing innovations which are low. a further £50 billion to reach the low part of very high cost, long-life capital Finally, back to innovation. Engineers carbon target. With no CCS, the additional assets tends to be inherently expensive so tend to look at the technological innovation expenditure is of the order of a further actions have to be targeted carefully. phase and sometimes miss the need for £200 billion. First, the financial conditions have to be business model innovation. We also need The ESME modelling shows that right. What level of carbon price would be to consider how we can engage consumers there is a decision to be taken by the necessary to make innovation in these areas in such a way that they commit to this mid-2020s. It highlights that the key cost-neutral? The ETI’s analysis identifies future and understand the implications, technologies are almost certainly nuclear three broad brackets. There are a number not least from a price point of view. ☐ Delivering a low-carbon future Sandip Verma

n order to meet the UK’s carbon UK’s energy infrastructure and markets investment between now and the end of abatement targets, around 60-80 since privatisation in the 1980s. Electricity the decade is up to £100 billion (£55- Gigawatts of new electricity generating Market Reform (EMR) encompasses 65 billion for generation and around £35 capacity will need to be built by 2030, a package of measures to incentivise billion for networks). Iof which some 40-70GW will come from the replacement of aging electricity low carbon technologies. infrastructure by a more diverse and low- Electricity market reform The Government has embarked upon carbon mix at the lowest possible cost to The most recent Impact Assessment one of the most radical overhauls of the the consumer. The estimated electricity estimated that annual household electricity

24 FST JOURNAL >> MAY 2014 >> VOL. 21 (3) decarbonisation bills would be 6 per cent (£41) lower on potential to deliver cost savings of £45 average over the period 2014 to 2030 under The Baroness billion and business creation for the UK EMR, compared to reducing emissions Verma of Leicester worth £18 billion. through existing policy instruments1. is Parliamentary The Government is supporting this The EMR package is calculated to Under-Secretary at important sector through the Offshore generate benefits of around £10.7 billion the Department for Wind Component Technologies Scheme. up to 2030 and could support as many as Energy and Climate With a budget of up to £15 million, it aims Change (DECC). 250,000 jobs in the energy sector. There to help companies to test and demonstrate Prior to this, she was a spokesperson are also potential benefits to the supply devices and to develop component for the Cabinet Office, International chain: the Government considers that open Development, Women and technologies that can cut the costs of and competitive supply chains will drive Equalities and Business Innovation offshore wind energy in the run up to 2020 down the cost of low-carbon generation and Skills. She was an Opposition and in the subsequent decade. over the long term and result in lower Whip from 2006-2010 and then We are also investing in Carbon Capture energy costs to consumers. Government Whip following the and Storage (CCS) innovation, helping to The long-term vision for the electricity 2010 General Election. A successful develop new carbon capture technologies, market involves a decreasing role for businesswoman, Lady Verma started including processes and chemicals. The Government and a move to a market where her first business at the age of 19 in Netpower project aims to reduce the costs low-carbon technologies compete on price. high fashion, supplying high street of power generation by over 20 per cent The EMR is a market-pull mechanism, multiples. compared with current achievements and but incentives to deploy technologies can capture all of the CO2. only be achieved with the market push of Innovators have to secure financing In 2013, DECC announced funding for a technology innovation. We need to have throughout the development journey. number of innovative technologies through lower costs and more efficient technologies. This is a particular challenge for smaller the ‘Invest in Innovative Refurbishment’ businesses that are not generating sufficient programme, including: £19 million for Innovation revenue to borrow from banks and are energy storage: £5 million to integrate UK UK innovation in low carbon technologies developing complex technologies which nuclear research infrastructure: and £10 provides opportunities for the economy. are not widely understood. million for energy efficiency technologies. The DECC Carbon Plan recognises The other challenge is risk. New We are also working across Government that innovation is essential to meet the technologies have unpredictable risk. with other funders of innovation, UK future energy needs. Investment Reducing risk will quicken uptake and including the Department for Business, in innovation now will improve the encourage further private investment. Innovation and Skills (BIS) and the Energy affordability of the technologies we deploy Technologies Institute, to maximise the in the future, reduce bills for householders Collaboration impact of UK public sector funding for and businesses, and strengthen energy Collaboration between Government low carbon technologies through the Low security by offering a range of technology and innovators is essential. Innovation Carbon Innovation Coordination Group options for the UK to deploy. gives the UK a competitive advantage in (LCICG). Together we will provide £1 Indeed, recent growth figures show global markets. Yet, the private sector billion between 2011 and 2015 to directly that green investment is paying back alone cannot deliver the innovation we support energy innovation. handsomely. The UK now has a share of need. DECC’s innovation programme is the global low-carbon goods and services projected to save the UK up to £160 billion Targeting support market worth more than £120 billion in energy costs in the period up to 2050. To determine how best to identify annually, equivalent to 8 per cent of GDP, That in turn could leverage over £100 and target our support, the LCICG and accounting for a third of the recent billion of private investment, adding up to has published a series of Technology growth in the UK economy. £89 billion to GDP. Innovation Needs Assessments (TINAs). The Energy Technologies Institute’s Between 2011 and 2015, the programme The TINAs focus on meeting targets Energy Systems Modelling Environment is supporting 150 entrepreneurial at lowest cost and boosting economic (ESME) suggests that savings to the UK companies developing low carbon growth. These reports cover technologies economy through innovation over the next technologies. The UK has the most from domestic buildings to energy storage 40 years could be up to £600 billion. offshore wind deployed anywhere in the and next generation nuclear. The two key challenges in maximising world. Analysis indicates that by 2050 The LCICG is now building a strategy opportunities involve finance and risk. offshore wind innovation alone has the to help guide our innovation programmes

DISCUSSION and determine our priorities over the next Cutting demand decade. The strategy will provide greater confidence to the energy sector, reducing While great emphasis is placed on supply issues, there has been little discussion of risk and helping to align investment. the demand side. Much greater efforts need to be made to encourage consumers The Government plays a key role as to restrain their demand. A full roll-out of smart meters will help, particularly an enabler. Our scientists, engineers and to moderate peak demands and discourage unnecessary use of power. But it is entrepreneurs are the sources of innovation, behavioural change that is really needed. There are insufficient incentives for though, and it is their ideas that will reduce retailers and other business consumers to reduce energy use. Education is key, energy costs, create jobs and stimulate but community pressure should not be under-estimated (it was effective in the growth. ☐ case of waste collection). Communities could come together to promote demand 1. https://www.gov.uk/government/ uploads/system/uploads/attachment_data/ reduction, exerting peer-pressure to encourage a change in habits. file/268202/Delivery_Plan_IA.pdf

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The UK has undoubted strengths in research and technology. But how can these be maximised for the benefit of the UK and its people? The issue was discussed at a meeting of the Foundation for Science and Technology on 13 November 2013. Maximising UK strengths in research, innovation and higher education John O’Reilly

he remit of the Director-General, science, engineering and technology, of Knowledge and Innovation at Sir John O’Reilly course, but also, importantly, the social the Department for Business, FREng is sciences, the arts and humanities, etc). The Innovation and Skills (BIS) Director General, UK has maintained substantial ring-fenced Tcovers three main areas. There is the Knowledge and funding for scientific research through research base: the seven Research Councils, Innovation, at difficult times. Funding is awarded UK Space Agency, etc. Second, there is the Department competitively which is part of the basis of the Innovation Directorate, which includes for Business, its continuing success. responsibility for the Technology Strategy Innovation and Skills (BIS). Sir Science, of course, is international. Board, the Intellectual Property Office, John has oversight in BIS of the Goethe said that science and the arts belong Research Councils, the Technology the National Measurement Office and a to the whole world. Barriers of nationality Strategy Board, Quality Research number of other bodies. Then there is vanish before them. Chekhov said there (QR) funding of universities and Higher Education: we have funding and other research and innovation is no national science, just as there is no policy responsibility for England but, not policy and funding and for national multiplication table. That is a least because responsibilities in the first Higher Education in England. He way of underscoring the importance of two areas are UK-wide, we have a need was Vice-Chancellor of Cranfield international engagement. For many years here too for a UK-wide perspective. University from December 2006 to it has been the case that, for almost all While it is quite convenient to look at February 2013. Prior to joining countries, Britain has been the first choice these areas separately, it is important not to Cranfield he was Chief Executive for collaboration in frontier research after overlook the fact that they are inextricably of the Engineering and Physical the USA. linked and they work together. I would Sciences Research Council (EPSRC). The numbers are well known and speak suggest that no nation could sensibly for themselves. The UK has 1 per cent of decide to be good at only one of the the world’s population, funds about 3 per three – research, innovation or Higher measured against their peers around the cent of the research that is done across the Education. To be excellent at any requires world. world, produces around 6.4 per cent of the commitment to excellence in all three; academic papers and achieves 11.6 per cent they are so inextricably intertwined Research of the world’s citations. That last figure and mutually supportive to the point of The Chancellor has said publicly that he rises to about 15.6 per cent if the standard symbiosis. wants Britain to be the best place in the is the most highly-cited papers. world to do science (and when he says Turn that into yield per unit of currency Higher Education ‘science’ he is referring to the full spectrum invested and the UK massively outperforms Let us consider three international rankings of knowledge creation through research: any other country. for universities: the Jiaotong (which is produced in Shanghai) and the Times HE and QS scales. Although universities move 11 up and down depending on the particular /13 06/7 07/8 08/9 ranking system, the most striking fact is 20 20 20 2009/10 2010/ 2011/12 2012 that only two countries are represented 0 in the top ten of all three: the UK and the 2 USA. The UK is very strong indeed and, 4 when adjusted for GDP or population, nking 6 stands out by a considerable margin. 8 Yet it is not just in the long-established, rld ra

famous seats of learning where this country Wo 10 excels. A recent study by the Times Higher 12 Education and the Guardian ranked the 14 top 100 universities in the world that are less than 50 years old. On that measure, too, the UK heads the table: our newer Figure 1. UK world ranking in university-industry collaboration. Source: World Economic universities come out very strongly when Forum

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closely it becomes evident that the top five countries in this area are performing UK almost identically. In other words, we are now firmly in the leading group worldwide, Singapore as judged by the WEF. We also are very good at attracting US R&D investment from global businesses. And despite difficult economic conditions, Finland business R&D has held up reasonably well in recent times. Switzerland GE, headquartered in the USA, has its own global innovation scorecard and the UK sits in the top quartile, 23456 along with the USA (countries are not individually ranked). According to the Figure 2. University-industry collaboration rankings 2013-14 on a scale of 1-7. World Intellectual Property Organisation, Source: World Economic Forum. the UK again ranks very high – and IP rights are probably as much a condition for innovation as innovation itself. 100 One remarkable achievement in 2010 90 was the Government’s commitment 80 to maintain the science budget despite the prevailing difficult economic 70 circumstances. The 2013 Spending Review 60 has shown that for the immediate future

50 s there will be continued pressure on public 40 spending. Even so, there was still an extra ngdo m 30 £185 million allocated to the TSB, putting Ki it on a firm forward trajectory. 20 n

Finland Netherland There has in fact been very consistent 10 Government support for the science, Franc e United Germany Ireland Spai Sweden 0 innovation and higher education agenda. Looking forward, I believe it is time, Figure 3. Number of R&D Foreign Direct Investment projects by EU destination country, collectively – across Government, across 2002-2006. Source: BIS. industry and more widely in the country – to stand back and form a view of what Innovation twelfth in the world, using the World ‘good’ (by which I mean ‘excellent’) looks There is a view in circulation that we do Economic Forum’s measure of the extent like in the ‘knowledge triangle’ of research, rather well in research but that we are not of collaboration between academia and innovation and higher education. A clear, as good at innovation. However, I think industry in research. By 2013, on the same shared, view of what is appropriate here that there has been some quite remarkable measure we were second. to help us achieve the kind of economy progress in recent years. Looking back So it came as a surprise when the latest and society that we wish and need to have to 2007-8 and before, we were about data showed we were fifth. Looking more would serve us well. ☐ The criteria for measuring value Ben Ritchie

n thinking about maximising the monetary value and which are actually natural ally of the CBI or the Department value of UK strengths, the obvious more important: health, happiness, for Business, Innovation and Skills) question is to enquire what is enjoyment, pursuit of public life. Those sets out four main considerations in a meant by ‘value’? It is important are all things that research, innovation, recent paper: energy costs, infrastructure, Ito be clear on this. There are four broad science and technology can help to long-term thinking and a fair deal for categories where we might look to see deliver, so these need to be included in well-trained, highly skilled employees. whether the country is capturing that any assessment of value. Those four concepts can also be found in value: the creation of jobs; the creation the CBI’s Raising the Bar paper1. There of products; the creation of profit; and Creating the right environment may be disagreement on details, but the the creation of human capital and skills. What measures need to be taken in fundamental framework and ideas are Higher Education in particular is not just order to establish an environment which broadly shared across a range of parties. concerned with creating patents, it is also encourages the creation and capture of The consensus is there about the things about creating people. value? There is, in fact, a remarkable that need to be done. These include: In assessing value, there are many convergence of thinking on what needs an infrastructure rewarding high-quality, things that are more intangible than to be done. The Fabian Society (not a well-trained people; the provision of

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environment, it has not resulted in the in terms of technologies, of industrials, Ben Ritchie is a kind of radical innovation and disruptive medical technology or pharmaceuticals, Senior Investment change that is needed to create a really lags behind most of the other major Manager for Pan- vibrant science and technology sector developed markets in the world. Take the European Equity within the UK. recent IPOs Twitter and LinkedIn: these at Aberdeen Asset Industrial engineering – aerospace have market values of around $24 billion Management. and defence, chemicals – has created and $26 billion respectively. The most Aberdeen Asset substantial value compared with the valuable British technology company, Management is responsible for the wider stock market index over the last ARM Holdings, is worth less than Twitter management of £5 billion of client funds across a range of mandates. 15-20 years. This has been achieved, according to its stock market valuation. He has attended the Programme for though, at huge cost: manufacturing jobs This is extraordinary given the value of Leadership Development at Harvard have declined from 7 million to just over the processor and chip designs that ARM Business School and is a member 3 million since 1970, while household produces. of the CFA (Chartered Financial names like ICI, Rover and British Steel Apart from ARM, it is difficult to Analyst) Society of the United have disappeared – some have been taken find many companies of any material Kingdom. over and dismembered, some have simply size within the technology base; even disappeared in the face of overwhelming something like ASOS, which one might forces of international competition. The consider to be a UK version of Amazon – good quality educational establishments; UK has always operated an open-door a low-cost retailer – has a market value of an environment that reduces regulation policy to takeovers and as a result it just over $7bn compared to Amazon itself and encompasses a favourable tax has probably suffered in terms of R&D which is valued at well over $100 billion. environment. These are not radical, crazy spending as a percentage of GDP. Here in the UK, we have struggled policies, they are mainstream. The pace to find and back those really innovative at which those things are realised may Across the wider economy and break-through companies. One vary under different proposals but the Innovation and adaptation have taken may debate whether LinkedIn or Twitter structures and framework are very much place in the UK economy, not just within is sustainable, but that innovation and consistent. heavy industry but across a wide range cutting-edge change has not really been Manufacturing has declined as a of areas which have faced significant found in this country. percentage of GDP because services change. has grown so much more. Today, with From being a largely print-based A matter of culture deflationary pressure from the emerging company with Penguin, the FT and a very, I believe the biggest problem in the UK is world and the huge productivity gains very successful education business based one of culture. We are a fundamentally delivered by the increasing use of around textbooks, Pearson has become conservative country. We do not take technology, it is hardly surprising that the leading online digital education a long-term, constructive view when it a first world, highly developed, highly company in the English-speaking world. comes to investing. The Kay Review2 sophisticated economy like the UK By undertaking a whole decade’s worth argues that we need investors prepared to should focus more on services than of change, it has been able to create commit to risk with a long-term view if manufacturing. huge amounts of value through the this country is to have a culture that will That notwithstanding, UK corporates development of a really innovative and support real, radical innovation. This is have done surprisingly well over the last different business model. because the reality is that seven or eight 20 to 30 years. Yet although they have The Lloyd’s insurance market, again, out of every 10 start-up businesses will adapted to new circumstances, they have is another British institution which has fail. not innovated as much as they could. risen, phoenix-like, from the flames of This conservatism is not confined to Aberdeen Asset Management invests in asbestos claims and under-capitalisation funders, though. It is also apparent in the a number of the top UK engineering 20 years ago. Today, it is the leading corporate world where CEOs will not put firms. They have all, without exception, specialist insurance market in the world, money behind radical, new innovation. I followed the same ‘cookie cutter’ strategy, driven by technology but also by research do not know the reasons for the decisions focussing on: value; margin; return on (into risk, risk management and client by Rolls Royce to abandon its research capital employed. They do not invest in assessment). It is probably the fastest- into fuel cells and to discontinue its heavy machinery, they operate capital- growing area in the City of London. work on wave power, they may well be light assembly structures and they push However, the FTSE All Share Index, perfectly sensible commercial decisions. the manufacture of components and raw material costs down the supply chain DISCUSSION (preferably to another country where Educating for success manufacturing does not cost very much). Add to that approach a barrier to low- Are we being complacent about the success of our education system? cost entry from competition through a Outstanding research success and the reputation of our universities is rightly network of services and spares provision celebrated but overall our education system is not functioning in a way which and these businesses have a model which will support research success in delivering value. While 90 per cent of children has served them exceptionally well over in Germany study mathematics in the Sixth Form, in the UK the figure is only the last decade. 20 per cent. In higher education, there is still much to be done to encourage However, while this approach has interdisciplinary working and, above all, to equip students and researchers with enabled successful adaptation to a highly business skills and an understanding of business priorities challenging economic and business

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DISCUSSION activity is innovative, whether it involves A risk averse culture? R&D, whether it is forward-thinking – and whether it will create value. Innovation is severely constrained by the risk averse culture of the UK. As a society we must think long and Investment managers need to take a longer view of financial return. A common hard before setting rigid targets about complaint from start-up companies is the failure of financiers to provide how we rebalance this or that aspect adequate capital for development; this leads to promising companies being of the economy. We should be much sold to the USA where further capital was available. To some degree, this may more concerned with overall aggregate be inevitable because the pool of capital in the USA is so much deeper which achievement than being pleased because affords more opportunities for risk taking. Universities and Government must be manufacturing has not shrunk as prepared to risk negative publicity from the failure of projects. There is a lack a percentage of GDP. To achieve this of motivation in the Civil Service (and in Government generally) to be seen to be through neglecting other parts of the innovative. Innovation is difficult, can result in failure and can take resources economy would make absolutely no sense from other areas. at all. John Maynard Keynes talked about how a failure of an attitude of mind Yet the sums involved were relatively astonishing success. was a critical factor behind the Great modest. It is another example of a great The company has been opening Depression. Warren Buffett has made company, with a great deal of cash on the stores in Spain at a phenomenal rate, just the point that if investors had started balance sheet, which is not prepared to when most people are closing them. It in 1900 and invested in the US Stock invest in radical change for the long term. is a company prepared to invest through Market, they would have gone through Unfortunately, we see that all the time in economic cycles, taking a long-term view, two World Wars, the Great Depression the UK. adapting and changing according to the and the assassination of a President – and One business that does take the long- way the economy is moving. Innovation is still enjoyed exponential returns. Those term view (and not a business associated not always about technological progress. prepared to take risks will reap rewards with a great deal of innovation or and those that are prepared to take a technology) is Primark. This is a business The acid test longer-term view and embrace that risk- owned by Associated British Foods, itself This wider view of innovation and bearing culture will, I believe, derive great largely owned by the Weston family. It its relevance to economic success value for this country. is almost certainly the only company needs to be constantly borne in mind. 1. http://www.cbi.org.uk/campaigns/indus- in the FTSE 100 that would have the Being too narrow and prescriptive in trial-strategy/raising-the-bar-report patience to take a small Irish supermarket focussing on an arbitrary divide between 2. www.bis.gov.uk/assets/biscore/business- and turn it into one of Europe’s leading manufacturing or services, etc, is to miss law/docs/k/12-917-kay-review-of-equity- discount retail businesses. It has been an the point. The acid test is whether an markets-final-report.pdf

How Higher Education can deliver value to UK business Geoff Rodgers

igher Education is concerned capacity. He talked of ‘significant cultural Different approaches with research innovation, change’ needed within HE (which has There is an essential tension between producing graduates that are indeed been taking place since the report some of the reward mechanisms; ready for tomorrow’s jobs, was published). academics are encouraged to produce Hcreating new knowledge and supporting Lambert said there was much still to high-quality papers and this is not always the UK economy. Yet the Lambert be done, and he was right. He talked compatible with initiatives that support Review in 2003 estimated that only about the barriers encountered when public benefit. This can create false about 16 per cent of businesses were universities talk to industry. Some 50 per drivers for academics to prefer one type accessing information from HE. Lambert cent of companies reported deficiencies of activity over another, and that is not identified a whole range of issues from in customer service as the biggest necessarily good. businesses and universities about how problem in dealing with universities – From the university’s point of view well (or otherwise) they work together and industry still complains about that there are other issues: industry is often and therefore how public benefit could today. Business also complains about unwilling to pay for costs on research be created from the work of universities. difficulties in finding out who does projects. It can be necessary to use He talked about poor R&D investment what and who to talk to (I sometimes public funding in order to get industry to in the UK compared with other G7 find the same problem within my own participate in projects – which is an issue countries. He emphasised the importance institution!). when building consortia. Working with of knowledge transfer, as well as the Universities are still accused of being business involves lengthy and complex importance of building relationships and too aggressive over IP rights. negotiations. Partnerships are difficult

FST JOURNAL >> MAY 2014 >> VOL. 21 (3) 29 research and technology to maintain when industry has a more way to proceed and will help universities rapid turnover of staff than occurs in Professor Geoff widen the impact of their research. universities. Rodgers is Pro- Vice-Chancellor At base, universities are driven by Impact (Research) at Brunel excellence in research, while industry is In terms of impact agenda, we are asking University. His looking to create products and, ultimately, academics to consider the needs of the main responsibility deliver profit. is to lead the user right at the start of the research When partnerships work they can University in process, to involve users in the design be absolutely tremendous, but a huge the next stage of its research of the research programme and to work amount of effort has to be put in to unlock development, and ensure that it with them throughout the research the benefits of high-quality research for sustains a diverse and evolving, programme. This is to ensure that the business. vibrant, research community. He research will ultimately be of benefit has championed the university’s to them. Indeed, we are even asking Addressing the challenges open access archive and its blue-sky researchers to ensure that they Universities have changed significantly publication database, as well as understand how their work might be over the past five years, but clearly there developing strategic partnerships for used so that the research programme is are still issues around blue-skies versus research with a number of research designed accordingly. problem-solving research. Disciplinary and technology organisations. He The Witty Review1 identified silos remain barriers to interdisciplinary chairs the London Higher Research a number of areas where universities teams. Excellence Group made up of the might do better – better cooperation The advent of funding to support research PVCs of the universities in with Local Enterprise Partnerships interactions between universities London. (LEPs), better exchange of information and business interaction has been an between universities and industries and, important step forward. Studies suggest programme which deliver a great deal of particularly, working harder with SMEs. that every pound going into Higher value to SMEs. Businesses could be much Education Innovation Funding (HEIF) The emphasis on articulating the more involved in the totality of the yields typically between £6-8 (sometimes public benefits of research and the public university’s agenda, from the co-design more) value to the UK economy. benefits of universities, more generally, and joint delivery of programmes, Businesses are investing in universities: has been critical in HE. The Research taking students on work placements, Brunel is one of a number that have Councils’ work on Pathways to Impact, influencing the product both in terms developed long-term partnerships with together with the Research Excellence of the research and also in terms of the major corporates. However, universities Framework (REF) case studies on public graduates involved: in short developing find it more demanding to interact with benefit and impact from the Higher relationships that can bear fruit across a the small- and medium-sized enterprises Education Funding Council for England range of areas. (SMEs) which make up such a large part (HEFCE) have already, in my view, One example of the way in which of the UK economy. changed the culture. this engagement is developing is The Catapult Centres represent a project involving Brunel with three Policy an important new approach, one that other universities, as well as The Welding The policy landscape has been evolving our competitors are following. Other Institute, Network Rail and BP. It is very quickly. The arrival of the Technology initiatives run by HEFCE, such as the funded by HEFCE and by the Regional Strategy Board (TSB) and the notion of Catalyst Fund and the UK Research Growth Fund. The aim is to develop a creating research programmes that meet, Partnership Investment Fund (UKRPIF) National Structural Integrity Research directly, the needs of SMEs and industry have allowed universities to catalyse Centre – like a mini-Catapult Centre has been a major step-change in the existing relationships into larger – based near TWI in Cambridge. It delivery of public benefit from research. programmes which deliver benefits. has significant public investment and The European Commission’s Research The decision of Universities and addresses a major societal challenge. for SMEs Programme and a number of Science Minister David Willetts to allow New innovation will be created around similar initiatives have mirrored that business access to the fruits of the research an important challenge but the project approach. Brunel is engaged in sizeable from UK universities is an important one. provides an environment where students, and substantial research programmes Universities are working hard to ensure particularly postgraduates, can be funded and supported through the EU this happens. This has to be the right educated. There is a 10-year plan for this project and as a university we see

DISCUSSION ourselves working in this area for the next Innovation in larger businesses 20 to 30 years. We became involved in this project Large companies are traditionally reluctant to sponsor and fund radical R&D. If because of the opportunity provided by absorbed into the mainstream organisation, R&D departments tend to become an industrial partner. We already have less radical; kept separate they may be ignored, or starved for funds. The right 20 to 30 academics working in this space balance between operational expenditure and R&D is a perennial problem in where five or six years ago we had very any company; it is the job of the CEO to get the balance and organisation right, few. Within three or four years we will as circumstances change. It is also the responsibility of the CEO to monitor have double that number. This is a user- how foreign companies handle innovation and to understand how to globalise driven initiative in which the industrial successes. partners took the initiative, coming to us to discuss a new way of working.

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We have a similar large-scale project industry-ready graduates, taking a long- and health and society. To do this we are based on a long-term, 10-year relationship term view on what types of graduate might forming teams of 150 to 200 academics in with Jaguar Land Rover and Constellium, be needed over the next 20 years or so. In each area. looking at advanced casting technologies. this way, we can develop graduates for the We want to develop two or three very With several million pounds of funding future, not for yesterday’s jobs. long term relationships with key industrial from EPSRC, it is a unique national scale- The areas identified in the Government’s partners on these three themes. We believe up facility for light metal casting. Industrial Strategy sectors are particularly we can then add a great deal of value to Our own Experimental Techniques helpful for universities in steering us to some of our partner companies, helping Centre (ETC) has provided materials look at where we should be educating them innovate and providing them with characterisation services for 350 SMEs over people and where we should be doing the graduates that they are asking for. the past 10 years. About 50 of those firms research. However, we also need to equip We are also focussing on working have worked with us since, following that graduates with transferable skills in order with SMEs through intermediaries. We initial service. to ensure that they are ready to enter the have learnt, over time, that working They came with a problem, which world of work. And that means adding direct with SMEs in some circumstances we fixed by characterising a particular more emphasis to some of the ‘softer’, is quite demanding for universities. We material’s qualities. Then they came back transferable skills that employers in these are, therefore, exploring the potential of again for something else and we developed sectors say they want. working with them through other means – a relationship with them over time. Most Many institutions, including Brunel, are for example, with supply chains. of these relationships lasted between six developing ‘innovation hubs’, to harness the We have, for example, been working and 12 months. entrepreneurial zeal that graduates have, to with Marks & Spencer together with a In this way, we can draw in SMEs, help them develop their ideas and, if those number of people who supply them. That provide them with useful services, perhaps projects look really promising, help to take is a good way to work with a corporate do some contract or collaborative research them to market. A significant number of which has a chain of SMEs behind it. with them to help them with a particular graduates start their own businesses and Engaging with the whole chain can be very problem. Then they will go on their way the hubs can support that activity. productive. again and will not be back until they need Research and Technology Organisations us again. Maximising the impact of research (RTOs) and LEPs are also very effective That is one way in which a medium- All institutions are having to look at what at working with SMEs, so building sized, research-intensive university can they are doing, how they maximise their relationships with them can streamline work quite effectively with SMEs. We strengths in the light of what is happening relationships. Instead of trying to work offer a unique range of services – in this in the outside world. They have to identify with a very large group of SMEs at the same particular case, materials characterisation opportunities and discern how they might time, suitable intermediaries can help us equipment – that SMEs can access direct work with industry better. maintain and develop links over time. ☐ from us. At Brunel, we are trying to bring people 1. https://www.gov.uk/government/ together around themes to address major uploads/system/uploads/attachment_data/ Looking forward societal challenges. We have chosen to file/249720/bis-13-1241-encouraging-a- What more can be done? Well, universities reorganise our whole institution around british-invention-revolution-andrew-witty- in general can try to produce more three: energy futures; material manufacture; review-R1.pdf

events

Recent dinner/discussions organised by the Foundation for Science and Technology are listed below. Summaries of these and other events – as well as the presentations of the speakers — can be found on the Foundation website at: www.foundation.org.uk

Policy choices for the Turning knowledge into value The challenge of reduction of bovine – adding value to the marine communicating the tuberculosis (TB) sector from research and uncertainty in risk estimates 2 April 2014 innovation to decision makers Adam Quinney, Farmer and former 10 March 2014 5 February 2014 Vice-President, National Farmers Professor Ralph Rayner, Sector Director - Sir Mark Walport FRS FMedSci, Union Energy and Environment, BMT Group Government Chief Scientific Adviser, Professor Rosie Woodroffe, Senior Professor Ed Hill OBE, Executive Director, Government Office for Science Research Fellow, Institute of Zoology, National Oceanography Centre Tom Bolt, Director, Performance Zoological Society of London Professor Rick Spinrad, Vice-President Management, Lloyd’s of London Dr Miles Parker OBE FSB, Senior for Research, Oregon State University. Judith Hackitt CBE, Chair, Health & Research Associate, Centre for Science President-Elect, Marine Technology Society Safety Executive and Policy, University of Cambridge Professor Richard Clegg, Managing Dr Michelle Harrison, CEO, Professor Chris Gaskell CBE, Director, Lloyd’s Register Foundation Government and Public Sector Practice, Principal, Royal Agricultural University (panellist) WPP (panellist)

FST JOURNAL >> MAY 2014 >> VOL. 21 (3) 31 events

The economics of Cyber security: how secure are Edwina Hart MBE CStJ AM, Minister decarbonisation of the UK UK organisations from cyber for Economy, Science and Transport, electricity supply – how theft of IP? Welsh Government much are we prepared to pay 16 October 2013 Cities of the future - to meet carbon reduction Chief Scientific Adviser, Centre for the targets? Protection of National Infrastructure science, innovation and city 27 November 2013 (CPNI) management James Smith CBE, Chairman, The Hugh Eaton OBE, National Security 19 June 2013 Carbon Trust Director, Cisco UK Steve Quartermain, Chief Planner, Dr David Clarke FREng, Chief Professor John V McCanny, Director, Department for Communities and Executive, Energy Technologies Institute Institute of Electronics Communications Local Government Baroness Verma, Parliamentary Under- and Information Technology, Queen’s Sir David King KB ScD FRS Secretary, Department for Energy and University, Belfast HonFREng, Chair, Future Cities Climate Change Catapult Sir David King KB ScD FRS Richard Bellingham, Director, Institute HonFREng, Foreign Secretary’s Special Raising the bar - can learned for Future Cities, Strathclyde Business Representative for Climate Change, societies and professional School, University of Strathclyde Foreign and Commonwealth Office institutions particularly the Sir Mark Walport FRS FMedSci, (round-table discussion) Government Chief Scientific Adviser, Ian Simm, Chief Executive, Impax Asset engineering institutions Government Office for Science Management (round-table discussion) do more to contribute to Dr Bernie Bulkin, Director, Ludgate economic growth? Investments Ltd (round-table discussion) 24 September 2013 Celebrating the centenary Professor Tim Broyd FREng FICE, Vice- of the establishment of the President, Institution of Civil Engineers Medical Research Council - Maximising the value of the Professor Jeremy Watson CBE FREng What should be the research UK strengths in research, FIET, Vice-President and Trustee, The priorities for medical innovation and higher Institution of Engineering and Technology (IET) Patrick Kniveton FIMechE FIET, research over the next education President, Institution of Mechanical twenty-five years? 13 November 2013 Engineers 22 May 2013 Sir John O’Reilly FREng, Director Professor John Uff CBE QC FREng FICE, Dr Sydney Brenner CH FRS, Senior General, Knowledge and Innovation, Barrister, Keating Chambers (panellist) Distinguished Fellow, Crick-Jacobs Department for Business, Innovation and Center, Salk Institute for Biological Skills Studies Ben Ritchie, Senior Investment Manager, Maximising the use of public Sir Paul Nurse PRS FMedSci Pan-European Equity, Aberdeen Asset data - should research and HonFREng, President, The Royal Society Management publically acquired data be and Director, Francis Crick Institute Professor Geoff Rodgers, Pro-Vice- Sir Keith Peters FRS FMedSci FRCP Chancellor for Research, Brunel made more accessible? FRCPE FRCPath FLSW, Emeritus University 10 July 2013 Regius Professor of Physic, University Professor Geoffrey Boulton OBE FRS of Cambridge FRSE, Chair, Royal Society Inquiry into Dame Kay Davies DBE FRS FMedSci, Digital participation: how Science as an Open Enterprise Director, MRC Functional Genomics can digital access be made Professor Sir Nigel Shadbolt FREng, Unit and Associate Head of Division available to everyone? Chairman and Co-Founder, The Open of Medical Sciences, Department of Data Institute Physiology, Anatomy and Genetics, 31 October 2013 The Rt Hon David Willetts MP, Minister University of Oxford (panellist) Professor Alan Alexander OBE FRSE, of State for Universities and Science, Sir John Savill FRS FMedSci FRSE Deputy Chair, Royal Society of Edinburgh Department for Business, Innovation and Skills FRCP, Chief Executive, Medical Inquiry into Digital Participation Professor Sheila M Bird OBE FRSE, Research Council Lorraine McMillan, Chief Executive, East Programme Leader, MRC Biostatistics Rt Hon David Willetts MP, Minister Renfrewshire Council Unit, Institute for Public Health, of State for Universities and Science, Dr Alan Blackwell, Reader in Cambridge (panellist) Department for Business, Innovation and Skills Interdisciplinary Design, Computer Laboratory, University of Cambridge Can university-business The Armitt Review of the collaboration be used UK long-term infrastructure Improving the career paths project pipeline for MSc and PhD students, and to maximise short-term economic growth and reduce 16 April 2013 postdocs Sir John Armitt CBE FREng, Chair, The 17 October 2013 unemployment levels in Wales? Armitt Review of the UK Long-Term Dr Steven Hill, Head of Research Policy, 3 July 2013 Infrastructure Project Pipeline Higher Education Funding Council for Professor Colin Riordan FLSW, President Professor Brian Collins CB FREng, England and Vice-Chancellor, Cardiff University Head, Department of Science, Harry Armstrong, PhD Student, Sir Leszek Borysiewicz FRS FRCP Engineering, Technology and Public Babraham Institute, Cambridge FMedSci FLSW, Vice-Chancellor, Policy, University College London Dr Helen Ewles, Research Associate, University of Cambridge Tim Yeo MP, Chair, House of Commons Department of Pathology, University of Sir Terry Matthews OBE FREng, Select Committee on Energy and Cambridge Chairman, Wesley Clover Climate Change

32 FST JOURNAL >> MAY 2014 >> VOL. 21 (3) The Foundation is grateful to the following companies, departments, research bodies and charities for their support for the dinner/discussion programme.

Academy of Medical Sciences HR Wallingford Group Ltd Science & Technology Facilities Council Aggregate Industries Imperial College London Smith Institute for Industrial Mathematics Arts and Humanities Research Council Institute of Mathematics and its and System Engineering Association for Science Education Applications Society for General Microbiology Aston University Institute of Physics Society of Biology BAE Systems Institution of Chemical Engineers Society of Maritime Industries Biotechnology and Biological Sciences Institution of Engineering and Sovcomflot (UK) Ltd Research Council Technology Springer Science BP International Ltd Institution of Mechanical Engineers STEMNET BPE Innovation Japan Society for the Promotion of Technology Strategy Board British Academy Science The Institution of Engineering and British Council Jisc Technology The Kohn Foundation British Geological Survey John Wiley & Sons The Learned Society of Wales Brunel University Johnson Matthey plc The Lloyd’s Register Foundation BSI Group Keele University The Medical Schools Council Building Research Establishment King’s College London The Michael John Trust Canterbury Christ Church University Lloyd’s of London The Royal Academy of Engineering Cardiff University Lloyd’s Register The Royal Commission for the Exhibition Chartered Institute of Plumbing and London School of Economics and of 1851 Heating Engineering Political Science The Royal Society City & Guilds of London Institute London School of Hygiene & Tropical The Smallpeice Trust City University London Medicine The Wellcome Trust Comino Foundation London South Bank University TWI Ltd Costain Medical Research Council University College London Cranfield University Met Office University of Aberdeen D M C L Monterey Bay Aquarium Research University of Birmingham Department for Business, Innovation and Institute University of Cambridge Skills National Oceanography Centre University of Dundee Department of Environment, Food and National Physical Laboratory University of East Anglia Rural Affairs Natural Environment Research Council University of Edinburgh Department of Health Natural History Museum University of Glasgow Economic and Social Research Council NESTA University of Hull Edinburgh Napier University Network Rail University of Kent Energy Institute Nottingham Trent University University of Leeds Engineering and Physical Sciences Open University University of Leicester Research Council Parliamentary and Scientific Committee University of Newcastle ERA Foundation Peter Brett Associates University of Nottingham Financial Services Knowledge Transfer Premmit Associates University of Reading Network Queen Mary, University of London University of Sheffield Future Cities Catapult Queen’s University Belfast University of Southampton GlaxoSmithKline R&D Risk Solutions University of Warwick Health and Safety Executive Rolls-Royce Wheatsheaf Group Higher Education Funding Council for Royal Society of Chemistry Willis Research Network England RPS Energy The Foundation for Science and Technology 10 Carlton House Terrace London SW1Y 5AH Telephone: 020 7321 2220 Fax: 020 7321 2221 Email: [email protected] www.foundation.org.uk

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