UK must intensify efforts to enhance innovation, says report

Brussels, 17 Oct 2002

The UK continues to lag behind its international competitors in terms of technological research and development (R&D) spending and innovation, according to a new report by the UK's Department of Trade and Industry (DTI).

The scoreboard report looked at R&D investment by the top 600 UK companies and the top 600 international companies and found that R&D intensity (R&D as a percentage of sales) is 2.2 per cent, compared with 5.1 per cent in the Americas and an average of 3.6 per cent in Europe. The UK figure has however risen by 0.4 per cent since 1998.

'Innovation is the driver of growth in free market economies and R&D is a key component of innovation since it yields the new products, processes and services on which growth is based,' writes the UK Parliamentary Under Secretary of State for Science and Innovation, Lord Sainsbury, in his foreword to the report.

The report concludes that the challenges for the UK now are to maintain the UK's leading position in pharmaceuticals and biotechnology, health, aerospace and defence while increasing R&D intensity in other sectors where the UK compares less favourably with other major economies. Medium sized companies should also be encouraged in all sectors, but particularly in high R&D sectors, and should be encouraged to increase their R&D intensity so as to generate more new products, services and ways of working, concludes the report.

The UK government has already introduced a number of initiatives aimed at enhancing innovation: tax relief for companies carrying out R&D, additional funding for the science base to enable partnerships between companies and universities or research institutes, moves to create a 'world class business environment for UK companies' by the government and awareness raising of the benefits of R&D.

'Success will require vision, understanding and sustained commitment from all,' writes Lord Sainsbury.

To see the full report, please consult the following web address: http://www.innovation.gov.uk/projects/rd _scoreboard/introfr.html

CORDIS RTD-NEWS/© European Communities, 2001