Written Evidence Submitted by Catapult Network

(RFA0047)

Key points

• The Catapult Network welcomes the Government’s ambition to deliver national benefits through a new ARPA agency aimed at driving breakthrough technologies
• UK ARPA should focus on long-term challenges and should support large scale programmes to tackle major societal challenges
• The ARPA programme needs to focus on transformational R&D, supporting “big ideas”
• Government must be prepared to fund a much higher proportion of more ambitious programmes
• In support of the Government’s ambition in the development of ARPA, the Catapult Network is uniquely placed to play an expanded role in transforming productivity and prosperity by harnessing their unique capabilities

What gaps in the current UK research and development system might be addressed by an ARPA style approach?

A UK ARPA agency should establish new delivery approaches that break the sector silos currently existing across the landscape, allowing breakthroughs to arise more quickly. The recent models used in the COVID-19 crisis are a good demonstration of what can be done when the standard processes are challenged.

While the UK is in the global top-10 for research excellence output, in terms of development capability our nation is lagging behind. This lack of translational research capability leads to weakening the economy, employment and growth, resulting in commercial exploitation of UK ideas occurring too often overseas. An ARPA should close the gap the UK places on commercialisation of its research.

The main value from early discovery often comes from spillover effects that are realised in the long-term and require contributions from multiple organisations. It is important that these complex paths are valued.

Much University research still sits on the shelf, unexploited. There is role for an ARPA to intensify knowledge exchange across the academic research and RTOs where mechanisms are lacking and existing funding rules are restrictive – which is inconsistent with the Government’s narrative on collaboration.

What are the implications of the new funding agency for existing funding bodies and their approach?

A new agency should bring a fresh perspective, create approaches that are more agile and which nurture wider participation. In doing so it would first need to learn from the institutional memory that lies within the current funding agencies, through integration mechanisms and secondments.

The Industrial Strategy Challenge Fund (ISCF) was set up to follow an ARPA style approach. However, delivery mechanisms have defaulted into standard siloed methodology used at Research Councils and Innovate UK, failing to harness the opportunity to create more streamlined processes that incorporate the whole range of research and innovation under a unified mechanism.

A new agency should review current collaborative funding models. High matched funding needed from industry has restricted participation, other than where industry is certain of the returns. The ISCF funding allocation period (4 years per Challenge) has allowed for projects looking to only 12-18 months for delivery, with less ambitious goals and with little prospect of continuity as a result.

UK Research and Innovation (UKRI) was established to make both inter-disciplinary research and academic sector-RTO collaboration easier but prescriptive funding policies on eligibility – some of which are at least 7 years old – remain in place, making collaboration more difficult than necessary.

What should be the focus of the new research funding agency and how should it be structured?

The tools and mechanisms we have today focus on Incremental, and a small amount of Adaptive R&D. 

• Incremental R&D – solving small problems that customers have today
• Adaptive R&D – solving problems that customers will have tomorrow, because the world is changing
• Transformational R&D – solving the big problems that drive world change

The focus of the UK ARPA programme needs to enable more transformational R&D to support “big ideas”. This is where the previous delivery models such as ISCF have been limited.  Despite having a high level of ambition, the tools for delivery limit the outcome. 

In our view, to stimulate and benefit from more transformational R&D:

• Government should be prepared to fund a much higher proportion of more ambitious programmes at the outset.  This will avoid the need for industry investment that currently limit the ambition.  Private sector investment will come in later as nearer to market opportunities emerge
• Industry should be engaged in the delivery of these programmes as much as possible.  However, government should direct activities through an appropriate institution (or institutions), which could retain and manage the outputs (systems, prototypes, IP, …) on behalf of government and ensure they get exploited (industry are just as capable as universities at sitting on IP).  This is similar to the way universities retain outputs of their research, and also helps mitigate any state aid issues
• The institution(s) should be measured on the quality of the activities they undertake (similar to REF for universities), but also on success of commercialising the outputs (similar to Catapults)
• Involve industry in programme delivery. In doing so there is a ready route pathway to exploitation.

What funding should ARPA receive, and how should it distribute this funding to maximise effectiveness

Focus is needed rather than seeking to chase too many opportunities. There are a number of key enabling capabilities which are clear priorities: – low carbon technologies, new therapies and medicines, resilient communications, productivity through digitisation, sustainable food production, etc. UK ARPA should focus on long-term challenges, support large scale programmes and tackle major societal challenges.

Principles for ARPA projects should include: i) the potential for a customer or end user at the completion  of the project; ii) time horizons which might typically exceed those normally funded by Research Councils.

Funding mechanisms need to be simple, eligibility rules inclusive, and expectations on match funding levels realistic. Monitoring systems, financial management, and evaluation methodologies should reflect the nature of high-risk programmes, with processes that are transparent and straightforward. Assessing challenges and their performance needs to move beyond the typical cost-benefit economic case. Whilst market pull is important, funding that promotes the creation of spillovers (and actively looks out for them) is more relevant. By designing challenges that are large and diverse, the level of spillovers will become valuable. Assessment of significant broad impact should be more of a priority than engaging participants in endless processes for economic evaluation which are onerous, cost and resource intensive and are failing to demonstrate the real spread of benefits delivered to sectors.

To achieve the 2.4% of GDP R&D target, there needs to be a serious sustained intervention by Government to encourage industry to invest and build capability. Building confidence in the longevity of approach and then sustaining it is key.

What benefits might be gained from basing UK ARPA outside of the ‘Golden Triangle’ (London, Oxford and Cambridge)?

It is essential that Scotland, Wales and Northern Ireland are wholly involved. A distributed based approach to the R&D will have wider benefits for regional impact. Collectively, Catapults’ coverage extends across over 30 locations and builds on the strength of being a national infrastructure, offering access to business across the whole country. Establishing mechanisms for reaching out to the regions and maintaining close relationships with local authorities, LEPs and KTN regional members, devolved administrations, has been extremely valuable in our experience.

The role of the Catapults in UK ARPA

Established by Innovate UK as independent not-for-profit organisations, Catapults are world-leading technology centres providing access to expert technical specialists, engineers, cutting-edge R&D infrastructure, to accelerate the development, demonstration and adoption of new technologies and tackle the biggest challenges that society and industries face today.

The Catapults draw from their extensive collaborations with industry, universities, local communities, and others, and have established technology roadmaps, hence can undertake foresight work or act as a delivery partner for UK ARPA. Building on a £1.2bn investment in sectors of strength and operating in market with significant potential, Catapults are ideally positioned to play a role as the lead system integrator, at regional, national and international level, bringing a range of organisations together to:

●        Leverage regional expertise, to address national and global challenges to develop world-leading technology solutions in the most difficult areas that will give the UK a competitive advantage;

●        Drive economic levelling through the growth-building innovation support available in many sites across the UK and work to ensure that growing firms can access the talent they need to succeed in competitive global markets; and

●        Secure and enhance the UK’s international position through our proven ability to translate great science into societal and economic impact.

(July 2020)

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