15/03/2017 House of Lords


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House of Commons. We will now go over live to the House of Lords. You


can watch coverage after the daily politics later tonight.


My book -- we have to attain a nonexecutive chair and that person


be a person appointed to that role and a souvenir figure from business.


Most funding goes to companies, not to universities or research


institutes and this funding is used to support innovative and product


and process -- progress. Innovate UK's support has economic benefits


and will be all the more critical as we exit the EU with a changing


relationship to the industry focused programmes. It needs to retain its


strong business voice both in size UK and critically also outside. That


voice is something that will be amplified if it is chaired by


leaving -- leading industrial figures and the majority of business


numbers on the board. This is the purpose of amendment 160 six. The


Government amendments 173 and 183 are welcomed. Recognising the need


for Innovate to develop a wide range of support to new companies which


could include investing in forming companies as well as giving grants


and loans. Also enforcing Innovate's role. At the moment, I beg to move


amendment 160 six. Sun-macro page 105, line 16, insert the words.


It is simply that on the face of it, it appears that provision and a


supplementary powers 16, three subsection B, prevents the research


councils from doing a number of things which are important to their


fundamental function and clearly which they should be able to


continue to do. I hope the Minister will be able to explain to us this


amendment is unnecessary because of provisions that have not been


spotted in the bill or to accept this is something that needs to be


changed. I think although the wording of the amendment does not


see it, this applies to it innovate UK. Innovate UK has in its function


very often as to collaborate with industry and so it would seem


unnecessary to forbid it from setting up joint ventures.


You are as supportive as 166. I would like to make apologies that I


have not been present for this item when it was dealt with the committee


stage because I was abroad, but I have read carefully of the


discussion that happened at that point. I also am a member of the


science and technology committee which looked at this issue recently.


I share the concern that was raised that the science and technology


committee by a number of witnesses, concerned that the In a big UK would


be hijacked by the research Council and become the commercialization and


innovation of the research councils and that would usurp the current


hugely valuable role that Innovate UK has in their being business


facing, in supporting innovation, small businesses especially and at


the very early stages, where an entrepreneur has got a bright idea,


but no backers and no proof of concept. So I share the concerns the


noble Baroness, Lady Brown of Cambridge, that the membership of


the committee and chairmanship of the committee for Innovate UK needs


to be very much business focused and to have a predominance of business


focused people on it. I recognise that the Government has gone to some


weight in Amendment 183 and very much welcome that. I very much


welcomed the meetings that I've had with ministers, with Sir John


Kingman, and with the Minister of State for universities and science,


open web and is not here today, although he regularly is. But it is


probably my conversations with Joe that Johnson have made me most


alarmed, I'm afraid, and that, although he gives assurances


throughout about the business facing role of Innovate UK, every time I've


ever heard him describe it unprompted, he immediately describes


it in terms of it being the innovation and research arm of the


research councils. So I would hope that the Minister would recognise


that the role of Innovate UK needs further strengthening and to give it


a business -based chairman and a predominance of business based


members on the committee would strengthen that very much. I welcome


the Government Amendment 183, which addresses the issue that the noble


Baroness has just referred to, and I can confirm as the chairman that we


were indeed concerned at the original proposals, some months back


now, that Innovate UK should be put together with the research England


into research Council because it was clearly absolutely essential that


the business community should have confidence that they had Innovate UK


very much at their disposal, their organisation and it wasn't somehow


going to be subsumed by the research Council, and I think I accept that


the concerns expressed by the noble Baroness Lady Brown and Lady Young


have validity, but I do recognise that the Amendment Government has


put forward, particularly a and B of this Amendment, in 183, requiring


arrangements to have regard to personal engage business activities


and the need of priority, to have on the face of the bill goes a very


long way from where we were a few months ago, so I am content to


accept this as meeting most of the concerns that I at least had


originally. My Lords, I draw my attention to my interest as a


declared registered specifically to my chairmanship of WMT. I should


also mention that I served as a member of the review of the UK


research and innovation scheme that put it all together. As piece


appears to be breaking out today, I hope those who labored for so long


and the salt mines of the committee stage will allow a few brief words


on Amendment 16 six, 173 and one 83. All three will help innovate


Innovate UK promote partnership between business and academia. I can


tell you that can be a tough job. When I started WMT, we encountered a


lot of opposition, academics are protective of their independence


from commerce, however engineers do like making an impact, the bigger


the better, so their curiosity won out in the end. We know academic can


obstruct business collaboration. For example, grant application rating is


a prized skill in universities and for a very good reason. Critical


assessment of research proposals is vital to academic debate. Business


sees this rather different. Especially if they are expected to


disclose commercially sensitive knowledge. The technology strategy


Board was created and must address this, was critic here. We debated


here for about four years before this was formed, because there was


an argument, should Government intervene, should we pick winners?


And all the other arguments at that time. But we won and the technology


strategy Board was created. The body is now of course Innovate UK. Change


is constant, my Lord. So innovate UK needs leaders who understand the way


of business and science are changing and the flexibility to create the


right partnerships. Amendment 16 is which of this. Today, every business


is multidisciplinary will stop if you make cars coming need


programmers, the photographers, medical researchers as well as


engineers. Bringing Innovate UK's and the research Council under the


same roof makes scientific and commercial sense. I'm 173 and 183


would ensure business and scientific knowledge in its leadership,


allowing it to build flexible partnerships. Innovate UK's role is


to act as a catalyst. However, my Lords, while flexibility is needed,


Innovate UK should not be a bank. It has neither the resources. They


should use their commercial expertise to create incentives, to


encourage businesses to invest in innovation. It is a matchmaker, not


a moneymaker. Their role has to be to improve productivity in this


country from scientific research. The amendments in this will help


them deliver on that task. More generally, the amendments being


proposed elsewhere today will do the same for out right as a whole. I


just want to emphasise how much to speak to Amendment one 66. Just


emphasise again the importance of having individuals from a business


background. All too often these initiatives, I have seen that the


Government has the best of intentions, but there are people


involved to do not have experience in business, who have not run


businesses, and is when you run businesses you realise innovation


and creativity is at the heart of it. I would've thought go further


than this and say they must come from science related business


backgrounds. Any good business have to be innovative, food and junk you


have to be innovative, but is the key issue that you have to have


business backers of the top table. -- food and drink. I just wanted to


confirm that we are signed up to Amendment 166 in support, it is


important to get the balance right, it is probably another Goldilocks on


coming up but I'm sure the Minister will pick it up and hope we will get


some responses on that. We have also signed up to Government amendments


173 and 183, at the heart of the debate. Again, the argument made by


the local Lord Mr, there are ways to improve the spell. We have been able


to explore them in committee. There are support around the House of your


pleased to be apart of. We feel are constraints which may emerge more


from the business consideration then perhaps so far, and the noble friend


has pointed out the genesis of all this through technology strategy


Board through to Innovate UK, I think it is important that we learn


from our history and Dave for the experience they've had over this


period of time, the formation of UK our eye, the involvement of Innovate


UK in that was not recommended, they felt the issue should be looked at.


The Government decided to move forward and I think it is a


Government's is possibility that we get the most out of that therefore.


We're not talking that the question of a bank we're talking about an


opportunity to create incentives, a group that moves forward with the


support of industry movement, much better than one that tries it would


on its own and I look forward to hearing what the noble lord and Mr


has to say about that. Dillon my Lords, I think I find myself in


really a complete agreement with the noble lady, Lady Brown. -- my Lords.


I think all the sentiments are the same. They pick up on a phrase from


the noble lord about the purpose of Innovate UK. To sum it up in three


words, which he did, it was productivity from research. An


earlier we were discussing the first Amendment, and a Lord talked about


the sometimes serendipitous spurt that can spring from blue sky a sick


research. I think the point of Innovate UK's to ensure that more of


those fruits take root in the UK, rather than ending up in Israel or


the valleys that are more innovative than we are. The whole point of


Innovate UK, the whole purpose of this to bring Innovate UK with the


research Council is to create more for tile soil for some the great


ideas and research that comes out of our universities. In creating


Innovate you are right, we are creating something new. We are not


nearly bolted together nine separate bodies. To make this work, the


Government structures need to change. Weird introducing an


overarching board in UK are I, a high profile chair and executive. It


is appropriate that the governance of the councils change as well to


reflect this. We've been listening to this debate for some time now,


particular contributions from the noble Baroness Lee lady Brown.


Landlord Brewers. -- Lord. However, introducing a nonexecutive chair for


the councils into these new lines of accountability would risk confusing


accountability with UK are I and undermined the strategic role. --


UKRI. I can of course see the attraction of having a well-known


leading industrialist as nonexecutive chair of Innovate UK,


but it would not sit well with the governance structure of UKRI, and I


think would fatally undermine the whole concept of UKRI. However, we


acknowledge there are valuable roles back and play outside of direct


lines of accountability. For example, given support to the chief


executive, as a route to the high-level communication. We averted


discuss my noble lord's suggestion that we give each member of the


Council the role of the senior independent member and given


assurances that this will be done. We hope this is adequate to address


the concerns. Lord Mandelson gave a very good description of the


importance role that independent member can play in the circumstances


without undermining the integrity of UKRI. This Amendment, 166, also


seeks to determine the background of Innovate UK's councilmembers. As has


been discussed in respect to UKRI board members in an earlier


grouping, prescribing the background of councils in legislation would


encroach on the freedom of UKRI and its Council to manage their own


affairs and could be unhelpful in achieving the best possible mix of


individuals at any one time. However, we agree with the


sentiments express. In the case of innovate UK, the Government would


have a strong expectation set the guidance that a substantial report


of member should have a science related business background.


Innovate UK's current board never should speaks for itself with most


of the councilmembers having signed the technology business related


background. In addition to this, the board contains much complement three


experience of universities, finance, consulting and Government. Turning


to Amendment 173, my Lords, many of you have asked to see stronger


language on the face of the bill to protect Innovate UK's business


facing role. At Lords committee, the Government undertook to reflect on


how this could be done and we have tabled an Amendment that achieves


this in two ways. Firstly, in introduces stronger language to


describe UK's role, Innovate UK's role, in supporting the business


community. And record the need of support is more direct than the


previous tax. Secondly, introduces a new requirement to have regard to


need to promote innovation by persons carrying on business in the


UK. Finally, it maintains the overarching mission to increase


economic growth in the existing duty to have her guard to desirability of


improving quality. It has been said productivity is not everything, it


is nearly everything and if there is one word that should be on Innovate


UK's, in its DNA, it is the word productivity.


It couldn't be clearer to support innovation and it is distinct from


the other councils of UK R I E. Lady Brown and the Lord Mayor raised


concerns in the committee that it Innovate UK freedoms appear overly


restrictive. There will be no diminishing of the current freedoms


ins the move. It is based on conditions that apply to all


Government departments and public bodies and is approved by their


Treasury. It is intended to make it clear that it can enter into joint


ventures subject to safeguards and the broad parameters will be set out


clearly in advance and can be reiterated at Innovate UK's


portfolio as it develops. I hope these amendments reassure noble


Lords over the positive intent. These reforms come in the context of


the historically large Autumn Statement settlement of innovation


funding as part of the industrial strategy. Turning to amendment 173


a, I hope this meets the point raised by the noble Lord. Let me


reassure the noble Lords that it is not the intention of this bill to


disrupt commitments and obligations within the current councils. The


Government will not require UKRI to seek permission to continue with


joint ventures as part of the legal process to set out UKRI. In new


ventures, the Government will not subject councils to any oversight


from the Secretary of State that the councils do not already undergo. It


is our ambition is that they will be subject to less process and


concentrate more on their functions. Noble Lords may not be aware that a


great deal of work is currently underway in the councils and their


parent departments to ensure a smooth transfer of personnel


activities from the current organisations to OFS and UKRI. Joint


ventures alongside many other forms of corporate arrangements are in


scope of this work. The bill provides tools in schedule ten to


transfer these assets from the councils to UKRI through proper


transfer schemes. If more intervention is required, wet bed


joint-venture is not a range, the joint ventures will be individually


addressed. I hope this reassures noble Lords of two things. We do not


intend to inflict any due process, any undue process on UK -- UKRI.


They will continue to have delegated autonomy over matters pertaining to


their subject areas. Addressing Innovate UK and UKRI's freedoms, I


request the noble Baroness Lady Brown to withdraw her amendment. I


thank the noble Lords that have contributed to this debate. I


recognise from what he says that we have a very strongly shared joint


objective of pertaining the -- retaining the different roles and I


think in the light of the Government amendments which go a long way to


doing that and indeed his earlier and positive assurances on an


important role the senior independent members of the council


's, I beg leave to withdraw the amendment. Sun-macro is it your


pleasure that it should be withdrawn?


The question is amendments 167 to 173 be agreed. Amendment 1703A. Not


moved. Amendments 173 and 174. The question is 174 and 175 be agreed


also. In clause 88, amendment 176. I beg to move amendment 170 six. I


express my gratitude to Lady Brown who worked constructively with me


and my colleagues over the last few weeks and months. I am indebted to


my noble friend Lord Willis who has written and will continue to be a


beacon for ministers setting out in detail this important principle and


its practical applications. The Government has been clear in stating


the spirit of the principal through various provisions is already, in


the words of Lord Mandelson, hard-wired into the bill. I am


grateful to all the noble Lords who spoke on this point. A second


reading and committee. Many refer to the principle itself. I offered to


reflect on this and I'm delighted to move amendment 100 91. I hope noble


Lords will be delighted to accept it. We define the principle is the


principle that decisions on individual research proposals are


best taken following an evaluation of the quality and likely impact of


the proposals such as the peer review process. This amendment is


both hugely symbolic and an important protection for UK


research, putting reference to the principal and legislation for the


first time. There was a duty on the Secretary of State to consult


formally before laying regulations to alter the names, number of fields


of activity of the research councils. I'm grateful to the noble


Lord Lord Stevenson who asked the clarity on the point of prior


consultation at committee stage. I hope these amendments to live my


promise to address the noble Lord's question. Why this Government


committed to consult before altering the Council, these amendments would


bind future governments to this commitment also. This Government has


been consistent in its pledge to allocate separate budgets to each


council of UK -- of UKRI. I listened to the greater protections for the


noble Lords and the noble Baroness Lady Brown. I have reflected on


their speeches and the Government is tabling amendment 188 which will


require the Secretary of State on making grants to ten to publish the


whole amount in a separate allocation which will go to each


council. It will give transparency on all funding allocations to UKRI


and research councils, Innovate UK and research England. My global and


learned friend spoke about the definition of specialist employees


in clause 90 one. This proportion is intended to ensure research councils


may continue to recruit certain specialist staff that are employed


in relation to a council's field of activity. He raised concerns that


the current definition could lead to ambiguity for relevant staff but may


not be considered by some to be researchers or scientists. I have


reflected carefully and the case that he put forward and I am happy


to table amendment 170 82 addresses points. This amendment draws on the


language my noble friend employed in his own amendment at committee,


expanding the definition to include any person with knowledge,


experience or specialist skills relevant to the council's field of


activity who is employed by UKRI to work in a field of activity. I hope


this amendment alleviates the concerns of my noble and learned


friend. I look forward to hearing noble Lord speak on other matters


and will respond after they and other noble Lords have had a chance


to speak to these amendments. Amendment proposed, Claude -- clause


80 eight. At the end insert the words on the martial's paper. I rise


to debate two brief points. I hope I will be forgiven for taking the


opportunity to pay the warmest and pay tribute to my admiration to my


own friend 's Lord Stevenson and Lord Watson for the sterling work


they put in on behalf of this side of the bill. My Lords, there is a


great deal of feeling in the research about the points covered by


these amendments. I think there is a recognition and a tremendous amount


of work has gone in to try and find an acceptable formula of words that


I think it should be put on record that many of those who are involved


in the most outstanding research in our universities remain mystified as


to why such a process should be appearing in brackets when it should


be in capital letters because the review is essential to the process.


Also there is something that the word, excellent, should not have


disappeared. Quality is important but what matters ultimately in the


research record of our universities and in the contribution to Britain's


noble standing in the world about the quality of our research is its


emphasis on excellence. I do therefore put on record that this


goes forward, it will be essential to keep those two important concerns


of the research community in mind. I am involved in three universities


and I have been a governor for very many years and am now a governor. I


rise briefly to thank the noble minister for his introduction of


these amendments and I want to refer briefly to amendment 180 nine, 190


and 191 and say how delighted I am that the principle is on the face of


the bill. We have heard Joe in discussions during the passage of


this bill, many different views on what the principle is. Whether it


should be called something else. One of the key references is the paper


by the nobleman Lord Will it. It really is about peer review and


deciding which individual projects are funded within broader areas. It


is reasonable for ministers to have priority is just as when the noble


Lord was Minister, P describe the... The peer review system, the


practitioners and others close to the action should be the ones who


decide which projects are funded. Although the wording says quality,


I'm sure if I was on a committee, I would interpret quality as including


excellence echoing the point the noble Lord May. I support this