Joint written evidence submitted by the Department for Business, Innovation and Skills, and the Department for Culture Media & Sport (BIG0069)

1.       This memorandum has been prepared through combined analysis from the Department for Business, Innovation and Skills (BIS) and the Department for Culture, Media and Sport (DCMS) as the respective leads within Government for big data research and new digital technologies. The memorandum also draws on contributions from the Cabinet Office, the Government Office for Science, the Ministry of Justice and the UK Space Agency.

2.       The exploitation of big data can provide significant benefits for citizens across a wide range of areas including through supporting new breakthroughs in medical research and by improving the delivery of public services. It can also provide companies with greater insight into changing trends and consumer preferences, and support the development of new products and services.

3.       The Centre for Economics and Business Research estimates that the big data marketplace could provide up to £216billion worth of benefit to the UK economy between 2012 and 2017[1]. A recent Nesta study of 500 UK firms also found that those making greater use of online customer and consumer data were up to 13% more productive[2].

4.       The UK is well placed globally, and there is good reason to be confident and ambitious in this area. We have unrivalled historical datasets, a world-leading open data programme, solid data protection networks, and are in the top five countries for published academic articles in computer science. 

5.       Later this year the Government will publish a Digital Transformation Plan. The plan will set out actions to support the adoption of digital technologies, including data analytics, across the economy and action to tackle barriers to disruptive businesses entering existing and creating new markets.

6.       Big data was identified by the previous Government as one of the Eight Great Technologies[3] that will underpin the UK’s future economic competitiveness. Since 2011, the Government has invested over £520million in developing the UK’s big data and high-performance computing capital infrastructure.  This programme includes major investments in specialist centres such as the Farr Institute of Health Informatics Research, the Higgs Centre for Innovation, and the Hartree Centre at the Daresbury Science & Innovation Campus.  The recent Government investment of £113million in the Hartree Centre will develop cognitive computing and data intensive technologies to lower the skills barriers to using and deriving benefit from data.

7.       However, infrastructure alone will not realise the full economic and social benefits of data. The Government recognises that in an increasingly digital world it must work closely with industry, the public, researchers and regulators to address challenges in areas such as trust and privacy, data analytics skills, and raising the level of adoption of data analytics in both the public and private sector. Given the significant amount of action that the Government is taking in these areas, this memorandum highlights the key activities. Ministers will be able to provide further detail during evidence sessions with the Committee.

The opportunities for big data, and the risks

8.       The world is seeing unprecedented levels of new data creation, with the digital universe predicted to increase ten-fold - from 4.4 trillion gigabytes to 44 trillion gigabytes – between 2013 and 2020[4]. This new data is being generated from a number of sources including the growth of social media, greater use of on-line purchasing, and the development of new technologies like the Internet of Things and Smart Cities.

9.       Harnessing the power of this all this data, not just big data, has the potential to transform research and innovation. We are experiencing a paradigm shift, with the ability to generate, collect and process almost unthinkable quantities of data rapidly changing the basis of comparative advantage and competition in science and innovation. The digital revolution is not just rhetoric, and studies predict that data jobs in the UK will grow by 160% between 2013 and 2020[5].

10.   However, this growth in data also comes with some risks. As organisations store and use greater amounts of information, there is a heightened need for robust cyber security to avoid data being hacked or lost.

Open Data

11.   If the UK is to take full advantage of the digital revolution, data needs to be open and accessible. To support this, the Government has opened up over 22,000 datasets on the data.gov.uk website that cover a range of areas such as metrological data, house price information, and the accounts of every UK limited company. BIS has also established the Open Data Institute to stimulate innovative use of open data.

E-Infrastructure

12.   The science and technology surrounding data and its supporting e-infrastructure is evolving at unprecedented levels, and we must continue to develop and plan for the future. This includes investments from the £6.9billion science capital roadmap to ensure the UK remains internationally competitive. 

13.   Key to this is ensuring that the UK remains at the forefront of new data analytical methods, as well as continued investment in computing and the application of existing methods to publicly or privately owned big datasets

14.   BIS has responsibility for funding the UK’s data and computing infrastructure used for research, and for postgraduate skills in data analytics. Since 2011, the     Department has invested £520.7million to renew and introduce new capabilities. This investment is yielding benefits in terms of cost, time, advancing science, technology and innovation, and bringing inward investment into the UK. 

15.   For example, the Government’s initial £37million investment into the Hartree Centre is taking time and money out of the innovation process for the Centre’s industrial clients. This includes Unilever, who have cut stability testing on fabric softeners from 12 weeks to 45 minutes, and Democrata Ltd who have developed a product for predicting the location of hidden archaeological remains which cuts costs and risk for the construction sector.  

16.   Britain is also becoming one of the best places in the world for doing business in data analytics. The latest £113million Government investment for a cognitive and data-centric computing centre at Hartree, announced in Autumn 2014, has already attracted inward investment from IBM and other high-tech industry exceeding £200million.

17.   In the July 2015 Budget, the Government confirmed research funding for six new Next Generation Digital Economy Centres to drive the development of new digital technologies.  In addition, this Autumn will see the launch of the new Alan Turning Institute for Data Analytics that will work with private and public sector partners to create new opportunities from data analysis.

18.   The Government recognises the importance of creating a coordinated infrastructure for our data capability. This includes offering industrial access to academic infrastructure for specific needs such as pre-competitive collaborative research, and small business access to advanced software and hardware. 

19.   The Hartree Centre and ARCHER supercomputer connect academics and businesses to high-end data and computing tools. Hartree and the Alan Turing Institute will provide expertise and fundamental research to enable the UK to be at the cutting edge of data science.

Tech Entrepreneurs

20.   The Government believes it is critical to create the best possible environment for tech and data-driven businesses, so that they thrive from start-up to scale-up. We have reduced the rate of corporation tax to 20% with a commitment to reduce this to 18% by 2020, which will make it the joint lowest in the G20. Also, through initiatives like the Seed Enterprise Investment Scheme, investors are being encouraged to support early-stage start-ups.

21.   A network of seven world-leading Catapult Centres has been created to transform the UK’s innovation capabilities. The Digital Catapult builds platforms where UK SMEs can undertake data innovation at speed and with less risk, so that new digital products and services can be accelerated to market. It will support 10,000 small businesses by 2018, delivering an economic benefit of £365million.

22.   Experts in Government organisations such as the Met Office and Ordnance Survey are actively engaged in encouraging innovators to use their data to build new products. For example, Ordnance Survey’s GeoVation Hub provides direct support and advice for entrepreneurs using location data.   

23.   The Government also funds Tech City UK to deliver programmes focused on accelerating the growth of digital businesses, in London and cities across the UK, at all stages of their development. This includes the Future Fifty programme which offers tailored support to 50 growth-stage digital companies.

24.   The March 2015 Budget announced a range of new measures to help make the UK a global centre for the Sharing Economy, including two new Sharing City pilots in Leeds and Manchester. It also announced £11million funding for new tech entrepreneur hubs in Manchester, Leeds and Sheffield which will offer co-working space, meeting spaces, educational resources, and foster venture capital and angel networks.

Data Science in Government

25.   Data science has transformative potential for government itself. It can help cut costs, increase productivity, and improve the delivery of services. For example, analysing 800million monthly credit and debit card payments and matching these with other datasets is helping HMRC to more effectively target tax enforcement activity.

26.   Similarly, the Public Sector Mapping Agreement and the Public Weather Service ensure that metrological and location data & analysis is available across the public sector. This enables more efficient service delivery - from better ice gritting routes to improving civil contingency planning.

27.   In 2014, a government data science programme was commissioned by the Cabinet Secretary to help embed data science in government. The programme has since delivered a series of demonstrator projects and capability building activities. The Economic and Social Research Council is also developing a Big Data Network to shape our knowledge of society and better evaluate government policies in the future.

Whether the Government has set out an appropriate and up-to-date path for the continued evolution of big data and the technologies required to support it

28.   The previous Government identified big data as one of the ‘Eight Great Technologies’ where the UK has the research excellence and business capability to become a world leader.

29.   Big data has the potential to create new business and research opportunities across all sectors.  As outlined in paragraphs 12-19, the Government has laid the foundations by investing in the necessary infrastructure required to exploit this new technology. This investment followed a report in January 2012 by Professor Dominic Tildesley entitled ‘A strategic vision for UK e-Infrastructure: a roadmap for the development and use of advanced computing, data and networks’[6].  The report set out a ten year vision for the development of world class high-performance computing infrastructure and management. It also highlighted the importance of effectively coordinating effort and activities across the relevant Government agencies and other key organisations.

30.   The Government established the E-infrastructure Leadership Council (ELC) in March 2012 to advise it on high-performance computing and data infrastructure, hardware, software and skills.  

31.   BIS recently commissioned the ELC to investigate data privacy, big data, commercial uptake of cloud, and software quality and availability.  The ELC has also been working with specific sectors such as Construction, Finance, and High Value Manufacturing to increase the awareness, uptake and impact of using data analytics and e-infrastructure. Examples of their success include the £14million collaboration between all major UK-based pharmaceuticals, SME’s, academic partners and the Hartree Centre to apply digital processes to improve medicine design and manufacture, and the Digital Built Britain programme announced by the Government in February 2015.

32.   Satellites are also playing a major role in big data, including through the enabling of on-the-move broadband.  This is creating opportunities to make a step change in the competitiveness of the UK space sector.

33.   The Government is working closely with research and industry partners to realise these benefits. The UK Space Agency has worked with industry and academia to produce the ‘UK Space Innovation and Growth Strategy 2010-2030’[7].  The strategy identifies opportunities and actions to remove barriers to growth for the UK space sector.  This includes actions to increase access to, manage, and exploit data from satellites.

34.   The UK Space Agency also works in partnership with the Research Councils and the Met Office in exploiting big data from space. The ‘Earth Observation Strategy 2013-2016[8]’ and the ‘Implementation Plan for Earth Observation[9]’ outline the UK approach to realising the potential of Earth observation from space.          

Where gaps persist in the skills needed to take advantage of the opportunities, and be protected from the risks, and how these gaps can be filled

35.   As the previous Science and Technology Committee noted in its ‘Responsible Use of Data[10]’ report, one of the main challenges that the UK, and most other leading economies, face if they are to take full advantage of big data is to develop a sufficient level of skilled workers with data handling and data analysis skills.

36.   A report produced by e-skills UK in November 2014 indicates there has been a ten-fold increase in demand for big data staff in the UK in the last five years.  The report also forecasts that demand for big data specialists will increase by 160% between 2013 and 2020[11]. The e-skills study reflects a growing global demand for developed data analytics skills.  A recent report from McKinsey identified that the US currently has a skills gap of 140-190,000 people with analytics expertise[12].

37.   Over the last five years the Government has taken a number of important steps to develop the UK’s data analytics skills-base.  These include:

• The new national curriculum in computing introduced in September 2014 to reform GCSEs and A levels in Computer Science and provide a strong foundation for students to progress to further education or employment.

• Reforming apprenticeships in areas like software development so that the standards are developed by employers.

• Over £40million investment since Autumn 2014 in nine centres for doctoral training in different aspects of data.

• £18.4million of business and Government co-funding announced in July 2014 for the employer-led Tech partnership.  This funding will give employers a greater say in skills provision, including the delivery of over 2,700 industry approved apprenticeships.

38.   The Government has introduced the Cyber Streetwise campaign to provide individuals and small businesses with the skills to go on-line safely, and the Cyber Essentials scheme to help businesses protect themselves from cyber threats.  The Government’s National Cyber Security Programme has also put in place interventions at all levels of the education system to improve cyber security skills.

39.   Sir Nigel Shadbolt has been commissioned by the Government to lead an independent review of the accreditation arrangements for computer science degrees and employability outcomes of graduates to ensure they meet the UK’s future needs.  The review will be published in Autumn 2015.

40.   In addition, BIS and DCMS are working closely with Nesta, Universities UK and the British Academy on following-up recent studies into business demand for data analytics skills and how these skills are currently taught across different disciplines in HE institutions. 

Data Science Skills in Government

41.   We also recognise that there is a data skills challenge inside government.  The Government can acquire data science skills through external recruitment, but competing with market rates for data scientists may increase in difficulty as demand for data science continues to grow.  We are therefore developing the skills base in our existing analytical community, and have established:

• a cross-government data science community of interest to help build networks and share knowledge.
• an accelerator programme and peer mentoring scheme which pairs existing analysts with our best data scientists to work on a specific data science problem.

• new training and development offers such as an ‘introduction to data science’ course for government analysts at the Open Data Institute, and work with the Hartree Centre to develop a training offer for data scientists in government.

42.   The analytical professions are also reviewing existing skills frameworks to integrate data science, and are developing further plans to scale up data science capability including the recent recruitment of 15 new data scientists. In complementary work on technology platforms, the Government Digital Service is coordinating work on big data infrastructure and operations activity.

How public understanding of the opportunities, implications and the skills required can be improved, and ‘informed consent’ secured

43.   Ethical and responsible use of data by private and public sector organisations has the potential to provide a range of benefits to the public such as more personalised and better targeted services, and simplified transactions. However, issues around trust and security can limit their uptake, especially where big data analytics link and combine multiple anonymised datasets which can lead to an individual being identified. In a recent survey, nearly two-thirds of recipients felt that they had lost control over the way their information is collected and processed[13].  Securing and maintaining the trust of the general public on how information is collected, stored and used is essential if the full benefits of data are to be achieved.

44.   The DCMS Digital Economy Unit continues to work closely with officials in the Ministry of Justice to ensure that the voice of business is heard in the current EU Data Protection Regulation negotiations. The Government supported the General Approach at the June 2015 Justice and Home Affairs Council and remains committed to playing an active role in the ongoing discussions. However, we would like to see significant improvements to the text to ensure the new regulations strike the right balance between the privacy rights of individuals and the legitimate interests of business. We recognise that to do otherwise will undermine important processing that delivers tangible benefits to consumers and citizens without producing better data protection outcomes.

45.   The British Standards Institution is looking to develop products, such as kite marks, to try and increase levels of consumer confidence. The Information Commissioners Office is also examining the possible endorsement of privacy seal programmes to provide increased transparency to consumers on how organisations collect and use data.

46.   The Digital Catapult is working with partners in the public and private sector to develop a new ‘Data Sharing and Trust Framework’. The framework aims to generate value through increasing the flow of data sharing between organisations, and give consumers greater control of how their data is used and shared. The Catapult is looking to have a prototype of the framework developed by March 2016.

47.   In government, we recognise the importance of making sure that data and the new technologies at our disposal are used correctly, so that we can reassure the public we are acting responsibly with both personal and non-personal data.

48.   For this reason, we have set up the Government Data Science Partnership, which brings together the Cabinet Office, the Office for National Statistics, and the Government Office for Science to deliver the government’s data science programme.  The Partnership is leading work to create an ethical framework that helps civil servants address moral and ethical problems posed by data science.  The programme is also intended to reassure the public that government is aware of the challenges, and that any project undertaken is first assessed against a robust framework.

49.   The guidance is based on six principles which cover issues around public benefit, challenges arising from new forms of data and powerful tools, and the need for transparency. At its most basic, the public benefit of doing the project needs to outweigh the risks to individual’s privacy and the risk of people being treated unfairly or adversely. It has been developed jointly with departments, academics and external experts and is being used for new data science projects in government. Due to the evolving environment of data and technology, the framework needs to be regularly updated to adapt.

50.   Understanding public opinion on the use of such data and techniques is a key part of the framework. The Data Science Partnership is looking at options with the     BIS-funded Sciencewise programme to conduct work on understanding public attitudes which will help develop the ethical framework.

Any further support needed from Government to facilitate R&D on big data, including to secure the required capital investment in big data research facilities and for their ongoing operation.

51.   To develop the e-infrastructure in the UK, BIS has invested £520.7 million[14]  of capital funding since 2011 to renew, replace and introduce new capabilities that address the following areas:

• Networks;
• Data Storage;
• Software development;
• High Performance Computing Capability
• Cognitive computing and data-driven research

52.   Data technologies are evolving at a rapid rate.  Computing and data hardware has a finite lifespan - usually 3-5 years - and will therefore need to be refreshed with continued investment.

53.   The UK’s commitment to international science experiments such as the Square Kilometre Array (SKA)[15] will drive the evolution of data and data infrastructures. SKA eventually expects to generate data ten times that of the current global internet traffic. UK businesses are expected to benefit from this, both as users and as suppliers. The Research Councils have expertise in assisting UK companies to win tenders arising from similar science experiments.

54.   There are many big data initiatives underway in the UK which will help maintain our leadership in this area. However, to increase engagement - particularly with the private sector - there is a need to signpost them and demonstrate how they work together.

55.   Capital investments are vital but operational costs and building skills capability are equally important, with the UK needing more people trained at all levels of data science. This includes high-end post-graduates who can produce the next generation of algorithms, data analysts who are able to interpret information, and corporate managers who understand the opportunities that arise from transforming data into value. 

September 2015