Written evidence submitted by the High Value Manufacturing Catapult (IGR0082)

 

House of Commons Science, Innovation and Technology Committee Inquiry into innovation, growth and the regions

 

Executive Summary

The High Value Manufacturing Catapult (HVM Catapult) is a network of six world class industrial research, innovation and technology centres based across the UK. Its centres work with large and small and medium enterprise (SME) manufacturers to help industry to develop new manufacturing technologies and to create the conditions for economic growth, by enabling UK manufacturers to achieve significant improvements in their performance and productivity.

The HVM Catapult centres work to embed research and innovation activities and their associated economic, workforce and business growth benefits into their regional ecosystem, as well as nationally. This submission includes a number of case studies that demonstrate the value of Catapults to the UK’s research and innovation landscape and how regional authorities, economies and academia have engaged and benefitted from this work.

However, there are a number of key factors that are currently limiting how much benefit can be realised from the current system. A short summary of the answers to the Committee’s questions is below:

 

 

 

 

HVM Catapult Overview

The High Value Manufacturing Catapult (HVM Catapult) is a network of six world class industrial research, innovation and technology centres based across the UK. Its centres work with large and small and medium enterprise (SME) manufacturers to help industry to develop new manufacturing technologies and to create the conditions for economic growth, by enabling UK manufacturers to achieve significant improvements in their performance and productivity.

Since the network was established by Innovate UK in 2011 the HVM Catapult has worked with over 30,000 businesses, including 3,000 SMEs annually. The network has around 3,700 of the UK’s best engineers, scientists and technicians supporting industrial transformation from over 20 locations across UK. In common with all Catapults the HVM Catapult centres are non-profit distributing bodies, reinvesting any surpluses made in further research and innovation activity.

The headquarter locations of the six HVM Catapult centres are:

The HVM Catapult is the largest of the nine Catapults with substantial presence across the UK. Satellite sites include facilities in Wales and a partnership in Northern Ireland, with Queens University Belfast and others, to launch the Advanced Manufacturing Innovation Centre.

The HVM Catapult provides support for a wide range of manufacturing and engineering activities ranging through aerospace, automotive, food and drink, power and energy, defence and security, chemicals and pharmaceuticals to infrastructure and construction.

A number of critical technology families sit within these sub-sectors, these technologies include:

The principles of sustainability and supporting the government’s mission of achieving net zero run through all the HVM Catapult’s work, ensuring that centres operate programmes of work that prioritise resource and energy efficiency.

The HVM Catapult network also works across centres and locations to build a common understanding of the skills challenge across our sectors and technology areas. The network leads and engages with skills foresighting and the identification of skills technology anchors; providing a clear description of the impacts and benefits of technology adoption and the actions needed to upskill the UK workforce.

The image below shows an overview of the presence of the HVM Catapult centre activities and reach.

 

 

 

 

 

 

 

 

 

 

Inquiry Questions

Question 1

1.1  How does the Government drive research and innovation in our regions?

1.1.1        The High Value Manufacturing Catapult (HVM Catapult) is a critical part of the UK’s research and innovation (R&I) landscape. Activities supported by Catapult's innovation centres cover all regions of the UK, from Cornwall to the Shetland Islands.

1.1.2        Government funding is distributed via Innovate UK. This mechanism ensures that R&I funding is distributed in alignment with national governmental strategies. Engagement and delivery by the HVM Catapult centres, all located outside of London, also ensures that this R&I work directly benefits the regions these centres are based in and across the UK as national assets.

1.1.3        The centres within the HVM Catapult network also work cross-region, ensuring that innovations are not isolated to a single region or nation. Often sitting within clusters of academia and industry these areas act as a centre of gravity not exclusivity for technological innovation.  

1.1.4        University investment through UK Research and Innovation (UKRI) has been the most impactful route through which UK Government has supported research and innovation (R&I) in regions. Historically, this has favoured R&I activities in London and the Golden Triangle due to the research density in those areas. In the past funding has not filtered sufficiently into the regions and their respective Universities.

1.1.5        Historically, the European Regional Development Fund (ERDF) was another important way in which R&I was driven into the UK’s poorer regions. Given the UK’s position outside of the European Union, a suitable replacement mechanism needs to be found.

1.1.6        The contribution of ERDF activities to the UK historically was significant. To give an example, supported and part-funded by UKRI a single HVM Catapult centre delivered £79m of work across 9 ERDF programmes, performing 1874 SME business supports across 470 businesses in clusters in County Durham, Leeds, Cambridge and Scotland. The programmes created 240 FTE posts and produced £37m of GVA, created significant new products and bringing disruptive innovation to market.

1.1.7        Innovation support when delivered locally needs to be multidimensional taking into account the following;

1.1.1..1      Innovation adoption and diffusion support to local businesses – funding and associated support programmes to help them understand and access the current innovation capabilities available to them locally and nationally;

1.1.1..2      Major programme support – linking local R&I clusters and businesses into large consortia programmes seeking to address major national and international supply chain challenges. The historic Advanced Manufacturing Challenge Fund was a good exemplar of the scale and impact that can result in consortia challenges of this magnitude.

1.1.1..3      Development of local clusters – A concerted effort to more closely link local and national agendas together via the work of regional clusters.

1.1.8        Different metrics are needed to measure the economic impact of the UK’s research and innovation efforts. The traditional weighting on measures such as published papers within academia do not currently drive the right behaviours to create local impact from research and innovation.

1.1.9        The role of innovation infrastructure is critical – but it must be recognised that not all innovation infrastructure has created national or local economic impact and therefore investments need to be well scoped by specialists taking into account local and national needs. There is a significant difference in scope and ongoing investment levels in:

1.1.9.1  enabling better access of local businesses to existing local and national infrastructure;

1.1.9.2  developing local level “adoption/ diffusion” infrastructure centres and related activities and;

1.1.9.3  building National supply chain capabilities – such as those found within the HVM Catapult.

1.1.10    It should also be noted that some innovation infrastructure, such as unique national assets, perhaps necessary to maintain UK sovereign capability, international reputation or to anchor multi-national businesses is only likely to be funded at national level.

1.1.11    Similarly, duplication of capability or competition between publicly funded infrastructures is wasteful – diluting their effect, funding and failing to enable the critical mass of multidisciplinary skills to needed to operate them. Collaboration should be encouraged between existing capabilities – in particular between Universities and Catapults, and between the Catapults themselves and wider research and technology organisations (RTO). It should be noted though that at present UKRI/Innovate UK funding rules often make such collaborations unattractive owing to a cap, typically 30% of a project’s total value, being the maximum collective/combined contribution RTOs and Universities can make to a project.

1.1.12    Recognising that public resources are finite it is important that the UK achieves maximum return on investment in the short term in a way that allows the benefits to compound over the long term. A step change in innovation support, including accelerating the use of key established assets nationally, will deliver the growth across the UK’s growth sectors.

1.2  How effective are the government’s policies in supporting the innovation ecosystem across the UK’s nations and regions, particularly through commercialisation initiatives?

1.2.1        The translation of R&D into commercial successes remains challenging in the UK due to a range of factors:

1.2.2        Access to finance

1.2.2.1  Access to finance is a major barrier for R&D commercialisation, particularly for academic spin-outs and SMEs. This is true for both publicly funded R&D programmes, as well as accessing private capital. In the case of public R&D funding, there is intense competition for commercial R&D funding through UK mechanisms such as Innovate UK grants, and often new technologies and SMEs fail to secure funding because of the relatively small funding pot sizes. This significantly slows down their product development cycles and in the worst cases can block commercialisation altogether. 

1.2.2.2  More funding is required for Development, especially in the later stages as technologies progress closer towards market demonstration activities. Currently, there is no funding available in the UK for large scale market demonstration activities. UK industry can access Horizon Europe programmes for market demonstration activities at scale, but these are extremely competitive.

1.2.2.3  Industry-specific funding schemes, such as the Industrial Strategy Challenge Fund and other previously funded supply chain interventions (such as the Advanced Manufacturing Supply Chain Initiative - AMSCI), have been very successful in supporting end to end supply chain development and instrumental in driving targeted growth within specific industries.

1.2.2.4  Providing targeted grant finance to spin-outs and early-stage SMEs to access capabilities across the R&D&I ecosystem have proven valuable. Given the absence of funding instruments like the ERDF, it is even more important to create appropriate mechanisms to fund early-stage companies. We welcome more of these types of targeted funding instruments at appropriate scale and would be happy to offer our expertise and experience of working closely with start-ups and scale ups to support the development of new targeted funding schemes for the industries in which we operate.  

1.2.2.5  We also welcome the Catapult Associated Fund from Innovate UK, designed to provide pre-seed equity investment (by way of convertible loans) into companies deemed too early or less attractive for more risk adverse institutional venture capital.  This initiative helps to fill an investment gap that exists, particularly for deep tech spin outs outside of the golden triangle of London, Oxford and Cambridge. 

1.2.3        Regulation

1.2.3.1  Regulatory considerations are often onerous for SMEs particularly, who rarely have the capability and capacity to address these during their product/process design and development cycles. Also, the UK regulatory environment is in a state of flux across many industries and technologies. This is increasing risk and making investments in UK companies less attractive. The UK needs to adopt a pro-innovation regulatory environment that can accelerate good ideas towards demonstration and implementation. This will help stabilise the market and attract further investment. Furthermore, SMEs require significantly more support in accessing regulatory expertise.

1.2.4        The interface between academia and RTOs and Catapults

1.2.4.1  This key interface between academia and translational research organisations such as RTOs and Catapults should be further strengthened. The volume of research and inventions with potential for commercialisation continues to grow, and without appropriate resources to handle the translational aspects, the UK will continue to miss opportunities.

1.2.4.2  Catapults engage with academia and regional clusters in such a way that can catalyse the development of technologies, start-ups and spin-out businesses. The case studies noted at the end of this submission provide excellent examples of these activities.

1.2.5        Further to this, many UK businesses are slow to adopt or invest in new technologies. For example, this is evident in the UK’s adoption of robotics and automation for the purposes of advanced manufacturing. Despite hosting world-class advanced manufacturing activities across sub-sectors such as automotive and aerospace, the UK currently lies 23rd globally in per capita adoption of robotics, with that position declining annually.

1.2.6        Successive governments have highlighted the creation of a hydrogen industry within the UK as an opportunity for economic growth and contribute to securing the UK’s future energy supply. The global hydrogen economy is set to reach $8tn by 2050, driven by the critical role hydrogen will play in delivering net zero. As part of this, global demand for hydrogen technology, such as electrolysers, hydrogen gas turbines and fuel cells, is expected to increase to $1tn annually by 2050.

1.2.7        In support of the UK’s goal to achieve a market share in these opportunities HVM Catapult established the Hydrogen Innovation Initiative (HII). HII’s mission is to support UK industry to anchor high-value jobs, boost resilience, drive decarbonisation and secure the UK’s influence on the global stage by accelerating the development of critical technologies and supply chains for the fast-growing hydrogen economy.

1.2.8        With regard to government policies driving innovation across the UK, there are a number of cross-departmental policies that must align in order for the UK to take advantage of the economic and energy opportunities that hydrogen presents. HII is taking the lead with academia and industry to develop a national programme to identify the policies and actions that must be taken in the coming years. Alongside others these include the creation of a strategic delivery body, a national supply chain accelerator to prepare the supply chain around the regions of the UK.

1.2.9        A strategic focus on innovation investment across the regions will give the UK early mover advantage. Failure to put in place the right mechanisms will risk our capacity to secure global leadership, with the UK relegated to becoming a market follower – as we have seen in other markets (such as offshore wind).

1.3  How should devolution be harnessed to support innovation across the regions and nations, and what role should local government play in supporting research and development?

1.3.1        It is encouraging that Combined Authorities in England are taking an increased interest in Innovation and Technology as a driver of economic growth and the partnerships with Innovate UK, Catapults and Academia should be developed further.

1.3.2        HVM Catapult centres are already working closely with the Combined Authorities, where they exist, on regional science and innovation priorities. This includes support to Local Growth Plans with NECA, TVCA, GMCA, LCRCA, WECA, WMCA and an agreed approach with Innovate UK to support the delivery plans of Innovate UK Action Plans.

1.3.3        If Combined Authorities are to grow their responsibilities for shaping delivery of innovation funding streams they will need to acquire and develop both competence and their capacity to deliver strategic innovation funding interventions. In addition, HVM Catapult would suggest partnering with organisations, Innovate UK, RTOs and Catapults who can support this specialist activity.

1.4  How do factors such as the tax system, regulatory frameworks and standards influence the success of start-ups, spin-outs, and other innovation-driven businesses?

1.4.1        These factors all significantly influence the success of start-ups and spin-out businesses. However, the specifics differ from sector-to-sector.

1.4.2        In some cases, the focus should be lowering the regulatory hurdles/red tape that hinder the adoption of innovative products and services in the UK. Catapult centres often play an important role facilitating early communication and collaboration between regulators and innovators to tackle this. The Medicine’s and Healthcare products Regulatory Agency’s role with CPI’s Medicines Manufacturing Innovation Centres is a good example of this.

1.4.3        In some cases, there is a need for a systemic intervention to create policy frameworks to enable the growth and/or transition of particularly sectors of strategic importance to the UK economy. Catapult centres already play a key role in convening or contributing to the cross-government and industry conversation required to make these possible and can do more. Catapults would welcome a close working relationship with the Regulatory Innovation Office (RIO), sharing our insight and voice of industry to aid pro-innovation regulation.

1.5  What challenges do innovation-focused researchers and businesses face in spinning-out or scaling-up, such as accessing venture capital, infrastructure and intellectual property rights.

1.5.1        It is harder to obtain private investment in some key sectors than in others. This is due to a number of factors such as longer and more capital-intensive investment cycles resulting in longer (and perceived riskier) waits for return on investment. It is vital that Government, industry and academia collaborate to address this fundamental issue. A number of these perceived “riskier” sectors and sub-sectors are critical to the health of the UK’s population and economy, such as advanced manufacturing and pharmaceuticals. The diagram below shows to scale of the issue in the balance between investment activities in software and manufacturing sectors.

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1.5.2        It is essential that the balance of funding through UKRI into its Councils and Innovate UK supports the Government’s Growth mission. Supported by strong foundations at the start of the connected pathway, it is through business-led innovation and technology adoption that the UK will address UK productivity growth. Every effort should be made to empower this.

1.5.3        Enabling access to innovation infrastructure is key. The UK holds a lot of existing infrastructure that could be used by start-up and scale-up businesses. However, scale up is an expensive process, businesses need flexible funding to encourage access to existing capabilities. Holding shared innovation infrastructure nationally is efficient. It enables businesses to access infrastructure in a capitally efficient manner and can shorten the time to market.

Question Set 2

2.1  How does research and innovation in our regions drive growth and prosperity in those regions?

2.1.1        Findings show that employment grew 11% faster, after three years, for businesses working with Catapults, with this rising to 16% faster after six years.

2.1.2        The turnover of small and micro businesses that worked with Catapults rose by 27% when compared with other similar businesses, rising to a huge 50% increase after six years.[1]

2.1.3        Our findings show that engaging with Catapults provides an immediate and sustained improvement of the performance of firms, helping them to adopt commercially new innovations and technologies, and leading to faster employment and turnover growth in particular for smaller, high-tech, and firms in the services industry.[2]

2.1.4        Some of the biggest private sector investments into the UK’s advanced manufacturing sector over the last 20 years would not have happened without the work of the HVM Catapult Centres. The case studies listed at the end of this submission demonstrate such investments across the centres across the HVM Catapult.  

2.1.5        The HVM Catapult continues to expand into the UK’s regions and nations. In 2024 HVM Catapult Baglan opened in the Bay Technology Centre, Baglan Energy Park, Port Talbot. This new site is an office and digital factory hub run by the Warrick Manufacturing Group (WMG) in collaboration with the Advanced Manufacturing Research Centre (AMRC) Cymru.

2.1.6        Wales has a strong industrial heritage, historically centred on coal, heavy manufacturing and industry.  This has shifted towards service sectors, creative industries and tourism, while legacy skills from industry are moving towards higher technology sectors. However, Wales’ output per hour stubbornly remains 17.2% below the UK average and it has three of the 10 least productive parts of the UK, and none in the top 10.   

2.1.7        The digital factory hub at HVM Catapult Baglan has been granted £1.5m of Welsh Government innovation funding to provide AMRC Cymru with technology and equipment to showcase the latest research, development and innovation to local manufacturing industries in South Wales. The hub provides the Welsh supply chain direct access to HVM Catapult expertise as well as digital manufacturing R&I capabilities such as SMART workbenches, additive manufacturing printers, and augmented and virtual reality capabilities.

2.1.8        Manufacturing accounts for 18.4% of Wales’ economic output, equivalent to £11.3bn per annum which supports 147,000 jobs. However, investment in research and development in Wales is 40% of the UK average and there are a high percentage of innovation inactive small and medium-sized enterprises (SMEs). HVM Catapult will work initially with the estimated 100 middle-sized enterprises in South Wales which do not currently undertake any R&D activity.   

2.1.9        It is estimated that targeted support to the 100 middle-sized, innovation-inactive enterprises in South Wales in the first five years could create an additional £18m of additional GVA per annum. That figure could be doubled when the Celtic Free Port is operational. 

2.2  How effective are regional innovation hubs and clusters in supporting regional growth and prosperity for local communities?

2.2.1        The effectiveness of innovation hubs and clusters in creating impact for local communities will often depend on the strength and breadth of partnerships within those clusters, particularly in relation to economic development agencies and skills development programmes. To maximise the benefit for local communities from clusters, there needs to be focus on local job creation and alignment with skills and training provision in the region. Also important is a focus on local supply chain development associated with the cluster, where appropriate.

2.2.2        Example: CPI has formed a strategic partnership with Scottish Enterprise with a focus on the growth of key technology-led sectors in Scotland (pharma, industrial biotech, healthtech) and for the realisation of impact for that growth at a regional level. This includes support partners – including Universities and Skills Development Scotland - in the provision of skills and training activity essential for growth in key areas (e.g. oligonucleotide manufacturing).

2.2.3        Technology adoption and diffusion needs to be driven strongly into regional business clusters – helping businesses adopt “best in class” new technology. This can be done through regional innovation outreach activities helping local businesses to understand what is possible, and by providing direct funding to those businesses to enable access to national and local technology adoption and market demonstration capabilities.

2.2.4        However, major innovation infrastructure investments need to operate both nationally and locally. These infrastructures need to be scoped intensively with a view to their positioning in national and international sector supply chain challenges. Getting this right will enable the UK to address the major cross cutting challenges of our time – such as those within Net Zero and Healthcare which require significant national consortia programmes – rather than focusing solely on 1-1 business technology adoption support. Such centres tackle the disruptive technology innovation challenges and the market making technology challenges of our time – rather than solely supporting market adoption of current best in class technology to business. The HVM Centres demonstrate how it is possible to have both worldclass national centres of expertise on particular technologies and to provide local business support.

2.2.5        Over several decades the UK has chopped and changed its innovation support mechanisms unlike a number of competing countries. This has been confusing for UK businesses and for inward investors. Consistency and longevity of approach are important as is ensuring that established centres have significant and sustained operational support to enable them to build the critical mass of skills and specialist equipment to make them transformational to their sectors they serve. Capital equipment procurement cycles mean that long term clarity of funding is essential. Similarly short term funding, or competing for one-off funding pots, makes it next to impossible to retain in demand staff long term when there is less than 12 months certainty over contract lengths.

2.2.6        The diagram below demonstrates the role of innovation infrastructure Nationally and locally and the needs of adoption/ diffusion efforts versus National innovation capabilities.

A diagram of a catapult Description automatically generated

 

2.3  How regional Cluster growth can best be measured, mapped, and monitored to help inform local leadership and evidence-based policymaking by central Government.

2.3.1        Cluster definition is complex and requires multiple factors to be taken into consideration. Ensuring appropriate National oversight will be key. Commonality and consistency of approach, tooling, and factors which determine a cluster, are all important. Regional/Local Governmental authorities have a strong role to play and facilitating this through the Local Growth Plan process is a good approach. However, many Mayoral Combined Authorities (MCAs) lack the full capability and/or capacity to analyse their own local or to and consider all the factors which are important. The role of central Government and wider support organisations and representative industry bodies such as CBI, Catapults such as the HVM Catapult is key in balancing and “comparing and contrasting” with consistency, relative cluster strengths between regions. Clusters can be defined in many ways:

2.3.1.1  Data driven – using common tooling systems such as Data City. SIC code-based systems should be avoided as they are out of date for many emerging sectors and lack granularity in definition for emerging sectors.

2.3.1.2  Agnostic between clusters proposed by MCAs and devolved Nations – providing oversight and balancing placed based ambition with data reality.

2.3.1.3  Consider industrial or sector led cluster drivers. We class these as “CLUSTER PULL” factors and they include: number of businesses, number of employees, turn over, GVA of the cluster and export revenues.

2.3.1.4  Consider wider cluster development “CLUSTER PUSH” factors. For example, UKRI spend relevant to proposed sub sectors in a place, total investment funding (from databases such as “Dealroom”), and consider the involvement of strategic academic institutions and industrial innovation anchors - such as CPI and the wider Catapult network, Independent Research Organisations and Public Sector Research Establishments. Rapidly growing clusters usually contain significant numbers of these “CLUSTER PUSH” factors – pushing factors which drive or push cluster development via accelerated research and innovation activity, and vibrant start up and spin out ecosystem.

2.3.1.5  Analysis should take a dynamic (not static) view of clusters. Considering whether a cluster is nascent (but important as it is rapidly growing), established, or in decline, is important. For declining clusters, it is important to understand whether these clusters are critical for sovereign supply of critical components and materials within key UK supply chains – and therefore where public sector intervention should attempt to catalyse reversal of decline.

2.3.1.6  Occasionally clusters may sit within singular MCA areas due to the compact geographical scale of what one would usually consider as a “cluster” but more commonly business cluster mapping needs to be done at a National level discounting authority boundaries. Clusters usually sit within a wider pan regional and National networks or ecosystems and connections between regions are important.

2.4  Would unlocking investment at scale for innovative science and technology companies support regional growth, and how could this be done?

2.4.1        Continuity of approach, with sustained investment and funding opportunities for high potential projects and companies would be helpful. Too often businesses looking to scale up find applying for multiple small-scale grants too resource intensive. Where small funding pots are hugely oversubscribed a significant “opportunity cost” is imposed on business and unnecessary economic drag is created on the UK. In small business employees often take on multiple roles and have little time to invest in activities that are overly administrative. Larger grants, stage gated by achievement of agreed milestones would be more useful to these resource limited businesses.

2.4.2        There is a myriad of smaller grants available but very few that provide more reliable substantial and sustained investment routes, this creates a congested and confusing landscape.

2.4.3        UK Government must provide the conditions (access and resources) for ambitious large-scale public and private investment to flourish, catalysed through innovation and industrialisation of key sectors, which takes place within the right regions based on their strengths and networks.

2.4.4        With specific regard to the information given about the Hydrogen Innovation Initiative (HII) in answers 1.2.6 and 1.2.7, unlocking private and public investment in this technology area would likely be transformational for a number of regions. The effective deployment of hydrogen has the potential to create over 400,000 jobs that would be spread across the UK.

 

Question Set 3

3.1  How is research and innovation diffused or supported to drive productivity and growth in the regions, wherever it may come from?

3.1.1        A core mission of the HVM Catapult is to ensure that the R&S activities that are undertaken in the centres both engage the industrial and academic clusters that exist in the region. This extends to the use of local and regional capabilities and assets. Where possible and appropriate Catapult activities will utilise the assets and facilities that already exist in that locality, rather than duplicate capabilities. This approach increases the efficiency of the use of public funds and encourages collaboration.

3.1.2        Such manufacturing technology assets are then often treated as regional and national assets, they are supported by proactive business plans and become available to new customers and partners such as larger businesses and organisations willing to invest in the region.

3.2  What more can be done to ensure that innovation investments deliver tangible outcomes for both local and national economies, in terms of productivity and growth, and how should this be assessed?

3.2.1        The Industrial Landscape Transformation Maturity Model, shown below, is a good model for identifying the core elements and assessing progress of this work. 

3.3  To what extent do Catapults support technology diffusion, and drive both national and regional growth?

3.3.1        Catapults have a key role in both technology diffusion to business and in developing solutions to national and international supply chain challenges through disruptive technology innovation.

3.3.2        Every £1 spent by HVM Catapult is matched by around another £3 from partners - our work generates £0.5bn of research and development spend per year. 

3.3.3        This level of investment generates £609m of net additional GVA per year (including multipliers) or £277,000 of additional GVA per company assisted, enough to employ three additional workers. 

3.3.4        HVM Catapult was established in 2011, in the years to 2024 we have worked with over 36,000 companies (just over 20,000 of those companies being SMEs) across over 16,000 commercial and collaborative projects. Every year, the Catapult is directly responsible for delivering around 1,200 apprenticeships and 1,000 accredited traineeships.

3.3.5        The methods by which technology diffusion is performed versus technology disruption are different. Technology diffusion is delivered typically in simpler 1-1 business arrangements where a Catapult may demonstrate best in class technology on a clients product or process, showing basically “market demonstration” of a technology on a clients product or process.

3.3.6        Disruptive technology can be market making and typically begins to address some of the major challenges of our time in areas such as Net Zero and Health tech. Typically this may be delivered by pulling together large consortia R&D programmes.

3.3.7        The HVM Catapult centres have proven track record of delivering significant National and regional impact and growth this is demonstrated with a number of case studies detailed at the end of this submission.

3.3.8        National Innovation infrastructure is costly to build and operate. The location of Catapult and HVM Catapult centres reflects cluster geography. Catapults are national assets and their geographic reach is deliberately national as the UK cannot place Catapult infrastructure in every location in need of regeneration. As part of the HVM Catapult networks’ strategic growth we have created different regional deployment modes which seek to better enable access to HVM Catapult facilities in business clusters which are not geographically located next to Headquarter facilities – the MTC for example has established a major site in Liverpool complementary to its main site at Ansty Park Coventry which serves the East and West Midlands. This approach is enabling Catapults to have greater impact across more regions and places. It is also important to recognise that Catapult centres and services have been designed for additionality, addressing recognised UK capability gaps to drive forward innovation.

3.3.9        Catapults do not directly compete with private sector companies providing equivalent services. Instead, they seek to operate in areas of “market failure” which tends to be investment in capability to support technology across the “Valley of Death”. The Valley of Death operates across Technology Readiness Levels 4 – 7 and moving ideas across this Valley of Death requires high levels capital, specialist skills, and holds inherently high risk of technology failure.

3.3.10    Market failure exists because the scale of investment in both capital and revenue required is deemed too risky for the private sector to invest in in the short-term, hence the need for public sector intervention in RTOs and Catapults which support companies across this Valley of Death. Therefore, there is a significant cost-base associated with providing and maintaining capability and services which operate within these areas of market failure. Careful consideration is then given to the services that Catapults offer the market and the continued additionality over time as markets mature.

3.4  How well are universities and businesses coordinating efforts to develop and commercialise research, including the role of spin-outs and collaborative R&D projects?

3.4.1        In recent years rigid rules governing university spin outs have prevented some spin out businesses from being successful. Prior experiences include universities taking an overly large share holding and preventing follow on investment from 3rd parties. University support for spin out businesses that emerge from their organisation can often be too distant as the new business is held at “arms length”, or only goes as far as helping with services such as legal and accounting support. This issue is now beginning to be addressed and HVM Catapult centres see Universities making some positive changes which should be further encouraged and accelerated.

 

Case Studies

Below are a series of case studies from across the HVM Catapult described in such a way that supports the answers given to the questions posed above. The case studies identify alignment with national strategy, regional delivery on economic and business growth, innovation and skills.

As a reminder, the centres within HVM Catapult are:

Advanced Manufacturing Research Centre – South Yorkshire

The Advanced Manufacturing Research Centre (AMRC), now a part of the HVM Catapult, was founded in 2001 on the site of the former Orgreave coking works. Over the last 20 years AMRC attracted and safeguard substantial amounts of inward investment across the UK. It has anchored significant investment in South Yorkshire by companies such as Boeing, making gears and control systems for their 737s and 777s, McLaren, making their lightweight road car chassis, and Rolls-Royce making single crystal turbine blades for its Trent engines. This has brought jobs, pride and economic renewal; conservatively, the AMRC has attracted more than £260m in private investment and over 600 jobs to South Yorkshire to date in new highly productive manufacturing facilities (for export) and wider spillover benefits to regional suppliers.

Alongside MTC, the Advanced Manufacturing Research Centre (AMRC) is supporting Rolls-Royce SMR to demonstrate the methods to manufacture their Small Modular Reactors at scale. Alongside NCC, the AMRC has provided technical expertise to support the delivery of Airbus UK’s ‘Wing of Tomorrow’ programme which has been critical to safeguarding 6,500 jobs at Airbus in Bristol and Broughton and thousands more across their supply chain. The AMRC is currently working with Boeing on their global R&D priority for their future aerostructure platform for lightweighting at scale and rate of production.

The AMRC Training Centre is a national asset and a model of skills development and collaboration. Since opening in 2013, it has recruited 2,226 apprentices; worked with more than 400 different businesses - from small start-ups to major companies - and attracted advanced manufacturing businesses and their supply chain to South Yorkshire; providing high quality and well-paid jobs, and employers with a skills pipeline of talent.

Over 15 years, apprentices who completed their training between 2018 and 2023 will contribute:

●              £46m net present value of productivity benefits moving into the workforce - £38m will be in the South Yorkshire economy.

●              £280m net present value of direct, indirect and induced GVA - £233m will be in the South Yorkshire economy.

 

 

Advanced Manufacturing Research Centre – North Wales and North West England

AMRC works with over 400 SME, scale up and start up manufacturing businesses each year providing technical expertise. In North Wales a new state-of-the-art manufacturing assembly line was developed for a food and drink company, introducing digital systems and data harnessing that has revolutionised the business and led to record outputs. AMRC has helped develop a new product for a company that makes davits installed on wind turbines, which is 20% more efficient to manufacture and which has secure more than £20m in orders.

AMRC North West is playing a key role in driving growth, productivity and innovation, supporting Lancashire firms to compete nationally and internationally. An independent assessment carried out into an SME engagement programme run by AMRC North West, which supported 207 SMEs with access to advanced manufacturing expertise and equipment, showed that for every £1 invested in delivering the project, £4.51 was generated in the wider economy. 68% of SMEs reported making progress towards bringing to market a new-to-firm product or service as a result of support through the programme.

 

Greater Manchester Innovate UK Innovation Accelerator.

Two HVM Catapult centres; the National Composites Centre (NCC) and Centre for Process Innovation (CPI) have worked to support Greater Manchester Combined Authority to broaden local business engagement with advanced materials and to develop a materials sector vision for the region. As part of the project the Atom Valley site in North Manchester, a green field location, will be established as a focal point for GMCA’s Advanced materials and manufacturing vision, supporting a materials cluster.

This project shows how the combined capabilities of our existing National innovation investment in the Catapults can be leveraged into a place to bring significant sector, supply chain, technological and operational knowledge into an ecosystem – in places without existing Catapult infrastructure. This model and mode shows how it is possible for regional interventions to make best use of existing Catapult investments, without duplicating expensive innovation capabilities unnecessarily across the UK and avoiding the delay of creating new institutions and facilities. The model shows how regions can provide specialist support to local businesses more quickly and support development of compelling sector propositions for their localities.

 

North East England – NETPark

At NETPark in County Durham, Durham University, the Centre for Process Innovation (CPI) and Durham County Council have worked together to develop a high value Science Park for the whole of North East England. The land was derelict and the area in the 1980s had an unemployment rate of 61%. CPI and Durham University built innovation infrastructure on the site in 2006 and worked in partnership with the Council to provide research and innovation services to businesses, aide inward investment to site, and to incubate and support business growth. CPI at NETPark now hosts three National Innovation Centres and has delivered £72m of innovation projects. It has incubated 15 companies many of whom have now expanded onto their own premises, helping these companies go on to secure £285m of private investment, and supporting create of over 500 highly skilled jobs.

 

Ansty Park, Coventry

The Manufacturing Technology Centre (MTC) was established in 2011 at Ansty Park, Coventry as central anchor tenant on a 200-acre former airfield brownfield site. The MTC has played a pivotal role in attracting a diverse range of technology businesses, particularly in advanced manufacturing and engineering sectors, estimated at over £800m in value. Strategically located and accessible to both the East and West Midlands it has fostered a collaborative environment that drives innovation and growth in the Midlands region as a whole, leading to the creation of thousands of high-value jobs, both directly and indirectly, significantly contributing to regional Gross Value Added (GVA).

Notable companies and organisations drawn to Ansty Park due to the presence of the MTC include:

 

 

 

National Composites Centre – Bristol, Bath and the South West

The NCC located in the West of England, has been a constant cornerstone for innovation-led economic growth, driving the region's transformation into one of the UK's most productive technology clusters. Over the past five years, NCC has directly contributed £300 million in gross value added (GVA) and supported the creation or sustainment of 4,000 high-value jobs, with its broader impact extending to 10,000 roles across supply chains and industries. Partnering with over 240 regional businesses, NCC has fostered a vibrant innovation ecosystem with its local partners, delivering £40 million GVA annually to the local economy. By leveraging its advanced manufacturing and materials expertise, NCC has catalysed the development of 50 enhanced products, processes, and services each year. This demonstrates the Centre's ability to combine regional strengths and Centre led capability with national competitiveness, advancing the West of England as a hub for innovation and industrial excellence.

Today NCC’s role as an innovation platform is driving support to existing regional clusters such as Europe’s biggest aerospace cluster and the UK’s biggest defence cluster, to ensure maximum value is realised from the innovation investments made to date. In partnership with the West of England Combined Authority (WECA) and regional stakeholders the NCC is using its convening power and influence through knowledge and thought leadership to help forge new opportunities in high-impact sectors like clean energy and digital technologies. These will be represented in the West of England Local Growth Plan. Recent initiatives include:

         the establishment of a secure defence innovation facility

         collaborations with global partners, such as Vestas, to pioneer next-generation offshore wind technologies.

         Isambard AI, the UK’s most powerful supercomputer led by the University of Bristol and supported by NCC.

Furthermore, the Centre's focus on supply chain transformation, skills development, and business support through services such as NCC Connect underscores its commitment to regional SMEs. By mobilising strategic investments and fostering collaborations, NCC is a catalyst for regional innovation, generating direct economic benefits while contributing to regional and national priorities.

 

24 January 2025

 

 

 

[1] https://www.ukri.org/blog/empowering-business-growth-catapults-are-fueling-economic-growth/

[2] https://www.enterpriseresearch.ac.uk/wp-content/uploads/2022/12/ERC-Insight-Evaluating-the-medium-term-business-performance-effects-of-engaging-with-the-Catapults-network-VaninoRoper.pdf