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Smart but lightweight


    An imaginative innovation policy in Britain continues to be under-resourced.

    It is the intention of every government on Earth to inspire increased research, development and innovation in the private sector. How this should actually be done remains something of a mystery, however. Last week, the British government took a stab at the problem, announcing an administrative change that it hopes will help it meet its ambitious stated goal of expanding business expenditure on research and development from 1.2% of the economy to 1.7% by 2014.

    Innovation policy in Britain traditionally falls under the remit of the Department of Trade and Industry (DTI), which has long housed a pot-pourri of small initiatives and programmes aimed at fostering industrial innovation. Two years ago, this mixture was placed under the guidance of the Technology Strategy Board, an advisory committee chaired by Graham Spittle of IBM.

    “The Technology Strategy Board will be constituted much like a research council, but will have a different mission — fostering innovation in business.”

    Early next year, the Technology Strategy Board will effectively be spun off from the DTI and reconstituted as an autonomous entity. It will hire a chief executive and a small staff, and will operate at arm's length from the government, managed by a board drawing members from industry and finance. The group will be constituted much like one of the research councils that support British scientific research, but will have a different mission — fostering innovation in business.

    The change will give the group more latitude for effective action, and pulling it out of the DTI will have at least two other significant advantages. It will help the committee to address innovation, not just in manufacturing industry (the DTI's traditional remit) but also in the service sector — ranging from publishing to banking — which now constitutes four-fifths of Britain's economy. And the free-standing committee will be better placed to work with all departments of government, and address the area where the state can arguably make the greatest difference of all, by supporting innovative suppliers through the £150 billion (US$290 billion) or so that it spends each year on goods and services.

    However, the resources under the direct control of the new body will remain, in the first instance, rather paltry. Around £170 million worth of grants and other programmes is, for all the talk about intelligent leverage, unlikely to spur much of anything across an economy the size of Britain's. The Confederation of British Industry — which has, of course, an interest in the matter — has advocated the spin-off of the Technology Strategy Board, but suggested that it needs four times as much money to have an impact. The question of additional resources will be addressed by the Treasury in next year's Comprehensive Spending Review. Its outcome will tell us how much faith the government has in this particular innovation.

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