Select Committee on Science and Technology Second Report


1.We would urge Corus, in line with all major companies, to give serious consideration to the benefits of having research, technology and development at the heart of its strategic decision-making and management structures. (Paragraph 7)
2.The Committee views the reduction in research and development personnel as extremely regrettable and indicative of a short-term attitude. Research and development represent vital areas of expenditure for all companies, as these activities are essential in ensuring a company's long-term success and providing innovative solutions to business problems. (Paragraph 8)
3.While the Committee strongly encourages both international and industrial-academic co-operation in R&D projects, we hope that Corus will not completely abandon its own speculative research, and basic research in particular. Without investment in basic research Corus cannot be an intelligent customer for the work it sponsors. We also regret that these R&D activities appear to be transferring abroad. (Paragraph 9)
4.We urge Corus, and all companies, to consider the long-term damage which the loss of experienced staff can have on their ability to carry out effective research and development. We also deeply regret the job losses announced in research and development, and the loss of expertise they represent for R&D in the UK. (Paragraph 10)
5.We consider that Corus may have seriously under-estimated the number of R&D staff who will leave the company as a result of the restructuring, and urge the company to do everything possible to retain those with key skills. (Paragraph 11)
6.The Committee deeply regrets the human impact of these job losses upon the employees and their communities. It is also extremely concerned about their impact upon Corus' ability to attract new technologists into the company, and upon the appeal of careers in R&D generally. (Paragraph 12)
7.We sincerely hope that Corus will ensure that the creation of a new technology centre will not divorce R&D from production. (Paragraph 13)
8.The Committee notes with grave concern the imbalance of job losses between the UK and Netherlands, and what appears to be a downgrading of Corus' commitment to R&D in this country. (Paragraph 14)
9.The Government must examine the underlying causes of the job losses in Corus R&D and act promptly upon their findings. (Paragraph 15)
10.We are concerned that Corus is taking long-term decisions on the basis of short-term exchange rate considerations. (Paragraph 15)
11.We remain deeply concerned about the current state of physical sciences teaching within UK schools, which, if unreformed, will inevitably damage industry in the long-term. (Paragraph 16)
12.While job losses in research and development are always to be regretted, it was apparent from both Corus' and SIMA's evidence that some restructuring of British Steel, and its research and development facilities, would almost inevitably have taken place with resultant redundancies, even had the company not merged with Hoogovens. It is clear, however, that research and development at Corus has suffered deeply over the last year and will continue to do so until after the restructuring is complete. It is disappointing to note that the UK side of the business was required to bear more than its proportionate share of the cutbacks.
If the company is to survive its current difficulties successfully, R&D must be given a higher priority. We would urge Corus to consider carefully its resource allocation for R&D and to do everything possible to maintain its commitment to the UK in this field. The opportunity to create a centre of excellence for steel R&D in the UK with modern, purpose-built facilities at its new Sheffield Technology Centre must not be wasted. We hope that the new centre will truly be a state of the art facility, attracting new investment and new science, engineering and technology recruits into steel R&D. (Paragraph 17)
13.The Government must examine the fundamental reasons for Corus shifting the emphasis of its research and development activities to the Netherlands. The fiscal and economic problems identified by Corus (the currency issue, the tax regime and changes in the energy market), which clearly affect the other companies in this sector, need be addressed within the Government's policies. It is also imperative that the Government tackle the severe weaknesses identified by Corus in science teaching in the UK, if the country's technological future is to be guaranteed. (Paragraph 18)

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Prepared 25 January 2001