Lockheed Martin UK – Written evidence (STS0060)

1. Lockheed Martin UK (LMUK) is a wholly-owned subsidiary of Lockheed Martin Corporation, employing approximately 1,600 people in 23 locations around the country. Lockheed Martin invests on average over £1.8 billion each year in the UK, supporting over 750 British companies (75 per cent of which are SMEs), and over 23,000 jobs in the supply chain. Lockheed Martin’s principal work in the UK relates to defence and national security, including space. It also has various civil and commercial progammes, including the UK Launch Programme, and postal distribution technologies.

Q2: Are the right structure sin place in Government to implement a science and technology strategy?

2. It is currently unclear how the National Science and Technology Council (NSTC), and the Office for Science and Technology Strategy (OSTS), intend to engage with industry. The Government should consult with industry to develop effective mechanisms for engagement.

Q4: Is the UK realising the potential of its research investment?

Do bureaucratic processes hinder research and development in the UK? Are there examples of where these could be removed without compromising oversight?

3. LMUK contributed to, and supports, the written submission from UKspace and ADS on this topic. The recommendations from UKspace and ADS are applicable to all aspects of Research & Development (R&D) funding in the UK.

4. LMUK would particularly highlight the following points:-

1. Funding routes are complex and fragmented, despite the formation of UK Research and Innovation (UKRI), and government departments can also operate multiple different frameworks. This poses resource issues for companies;

2. It is unclear how R&D projects link to major programmes or procurements by government. A lack of understanding of the exploitation route can make the business case for approving involvement in an R&D funding call challenging;

3. A “phased” approach to funding is uncertain, and does not indicate the full scale of funding that could be available over a period of time. Again, this can make the business case for approving involvement in an R&D funding call challenging;

4. The timelines for R&D calls do not match corporate budget and planning cycles; and

5. R&D funding does not cover full overheads.

Q6: What more should be done to encourage private-sector investment in research and development in the UK?

What policies could incentivise private sector research spending in the UK? Are there international examples the UK could learn from?

5. Incentivising private research spending in the UK requires clarity of priorities (a “demand signal”). Compared to other countries, such as the USA and Australia, the UK’s science and technology priorities are not as clear. Moreover, there can be a lack of alignment between the UK’s stated objectives, and the technology strategies and priorities of multinational companies.

6. In addition to clarity about priorities, incentivising private research spending requires the development of long-term, strategic, and collaborative partnerships between the public and private sectors. LMUK would highlight the following models used in other countries, which the UK should consider:-

1. Cooperative R&D Agreements (CRADA) in the USA. CRADAs facilitate R&D collaboration between one or more federal laboratories, and one or more non-federal entities. Under a CRADA, federal laboratories may provide non-federal parties with access to personnel, services, facilities, equipment, Intellectual Property, and other resources, but not funding. Non-federal parties to the CRADA may provide the same resources, as well as funds. CRADAs are effective for helping commercialise Intellectual Property within government, or using government-owned assets to develop technologies. In other words, it speeds up development cycles, and supports technology transfer and exploitation; and

2. Australia’s Defence Science and Technology (DST) Group has ‘Strategic Alliances’ with companies, and other organisations.[1] The objective of these ‘Strategic Alliances’ is to promote mutually beneficial collaborative research in (agreed) areas of strategic significance, through meetings, briefings, demonstrations, information exchanges and, subject to separate agreements, interactive projects, secondments (or similar), loans of equipment, and access to facilities.

7. The Ministry of Defence’s (MoD) Defence Science and Technology Laboratory (Dstl) signed a long-term, first-of-kind ‘Collaboration Agreement’ for Strategic Systems with Lockheed Martin in June 2019.[2] This Collaboration Agreement is similar in concept to CRADAs and DST’s Strategic Alliances. It has proven very effective. Dstl has since used the model with Leonardo, in support of air survivability solutions.[3] Lockheed Martin would encourage Dstl/MoD, and wider government, to extend the model in other areas. It would also encourage the Government to review the need for a sole source justification, which is currently required in order to establish a Collaboration Agreement.

What more could be done to incentivise collaborations between academics and industry? Are there barriers preventing this collaboration that could be removed?

8. Lockheed Martin has developed ‘Master Research Agreements’ (MRAs) with a number of universities in the USA, and internationally. MRAs are more efficient than typical one-off industry sponsored research projects. They also encompass activities beyond research projects, such as the joint development and delivery of curricula. LMUK is unaware of a similar model in the UK, and would recommend this be explored by industry and academia.

Q7: How well does the UK collaborate on research with international partners and what can it learn from other countries?

In which areas of science and technology is collaboration, or negotiating access to existing projects, more appropriate than competition or seeking competitive advantage?

9. Given the scale of investment required to maintain an edge in most areas of science and technology for defence and security, and the need to rapidly field those technologies, collaboration with allies is required. The UK and its allies will need to draw on the respective strengths of their industrial and academic bases, including through knowledge and technology transfer, rather than “competing” on end-to-end technology development.

10. Industry will play a role in enabling this collaboration. It should therefore be involved in government-to-government discussions about international science and technology collaboration from an early stage. Currently, this does not happen, which hinders effective industrial investment across allied countries.

25 March 2022