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3.7 p.m.

Lord Chesham: My Lords, after the debate on research councils and before the debate on the mentally ill, my noble friend Lady Blatch will, with the leave of the House, repeat in the form of a Statement an answer to a Private Notice Question in another place on the contaminated equipment at the Forensic Explosives Laboratory.

Business of the House: Debates this Day

Viscount Cranborne: My Lords, I beg to move the Motion standing in my name on the Order Paper.

Moved, That the debates on the Motions in the names of the Lord Walton of Detchant and the Lord Thurlow set down for today shall each be limited to two-and-a-half hours.--(Viscount Cranborne.)

On Question, Motion agreed to.

Research Councils

3.8 p.m.

Lord Walton of Detchant rose to call attention to the present position of the research councils, with particular reference to the present and future resources available to them and to their relationship with industry; and to move for Papers.

The noble Lord said: My Lords, in thanking the many noble Lords who will contribute to this important debate, I hope that I may say how much I--and no doubt many others--are looking forward to the maiden speech of my noble friend Lord Clancarty, whose views will, I am sure, be listened to with great attention.

There can be no doubt that in relation to science, engineering and technology in the UK, the research council system is a jewel in our crown, greatly admired in many other countries. While the reorganisation of the councils into more appropriate groupings undertaken a few years ago has won general acceptance, there are growing concerns about some of the new mechanisms and policies adopted by Government in recent years, upon several of which I shall elaborate today.

As a neurologist and researcher in neuromuscular disease, I was privileged to be involved in the work of the Medical Research Council over a 12-year period in the 1960s and 1970s, finally serving as a member of that council for four years until 1978. In many respects those were halcyon days when research projects were graded

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on a scale of nought to six on the basis of their scientific quality, and when most graded at 3.5 or above through a careful peer review process could be funded. I also held a long term programme grant from the MRC for neuromuscular research, a grant which was renewed twice thus extending over a 15-year period.

We now have the unfortunate state of affairs when, through restricted funding, the MRC has been compelled to reject about 70 per cent. of alpha-rated proposals for long-term strategic research. Indeed, some alpha-plus programmes have also been rejected, with grave implications for the future of medical research in the UK. And the recent precipitate decision to withdraw funding for intercalated research degrees for medical students has been another serious blow.

It is of course the case that in medicine more research funds are now being provided by the charities and the foundations--not least the Wellcome Trust--than by the MRC, and yet many original and innovative research ideas are still unable to attract any support. Some have suggested that there are too many medical research workers competing for limited funds. That suggestion is one which I must reject firmly especially when, as the report of your Lordships' Select Committee on Science and Technology on Medical Research in the NHS based upon a sub-committee inquiry which I was privileged to chair clearly demonstrated, clinical academic medicine is in serious disarray. Many senior clinical posts are vacant throughout the country; and consequently the Committee of Vice-Chancellors and Principals has invited Sir Rex Richards to undertake a major inquiry into this urgent problem.

The position is so serious that some able and highly respected research workers in clinical medicine tell me that, in despair, they are applying to the national institutes of health in the United States for support rather than to the MRC, which has been compelled to turn down some of their best alpha-rated programmes. And there is clear evidence that these problems are by no means confined to biomedical science but extend across the whole field of engineering and science. Thus, there has been a recent dispute between the particle physicists and the astronomers about the proportionate allocation of research funds between these two disciplines. No doubt several noble Lords will refer to similar problems involving other research councils.

In making this point, I appreciate that government funding is finite. Indeed, in response to a recent Question posed by the noble Lord, Lord Peyton, the Minister indicated that the MRC and the other councils must live within their means; and I accept that in the last public spending round science fared a little better than did many other sectors of public expenditure. Nevertheless, comprehensive figures recently produced by the Science Alliance have shown that between 1985 and 1993 this country has spent a decreasing percentage of its gross domestic product upon R&D and significantly less than our major competitors in Germany, France, Japan and the United States. Hence, the question must be asked whether the means now provided for the research councils are

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adequate at a time of increasing international competition in basic and applied science, not least from the emerging nations in the Pacific Rim.

But while financial considerations are compelling, there are other serious matters of growing concern to which I must draw your Lordships' attention. First, the transfer of the Office of Science and Technology from the Cabinet Office to the DTI--a transfer carried out with what seemed to some indecent haste--has not perhaps turned out to be as disastrous as many feared, but is nevertheless perceived in the science community as having represented a significant downgrading for British science. Despite the great interest shown in science by the President of the Board Trade and the strenuous efforts and admirable speeches of Mr. Taylor, the Minister for Science and Technology, there is a view widely expressed that without a politician of Cabinet rank fighting its corner, the science voice is less clearly heard in government than formerly. Major concerns have also been expressed over the fact that the post of Chief Scientific Adviser, held by the notable Sir Robert May, is now located within the Department of Trade and Industry rather than the Cabinet Office. It is difficult to see how a member of a spending department will be in a position effectively to advise the many other government departments concerned with science matters. Many, like myself, believe that the post should have stayed where it was.

There are many, too, who regret the abolition of the Advisory Board for the Research Councils, so ably chaired by Sir David Phillips (now the noble Lord, Lord Phillips), who, like the noble Lord, Lord Dainton, the noble Earl, Lord Jellicoe, and the noble Lord, Lord Dahrendorf, regrets his inability to speak this afternoon. That body was able on the one hand to give cogent advice to government about science policy and, on the other, to be in regular contact with all of the research councils providing clear lines of communication and a consultative process capable of formulating policy and involving many able scientists. Without wishing to detract from the outstanding abilities of the individual concerned, I and many others believe that the replacement of that structure by a Director General of the Research Councils may have been a retrograde step. The science community is not aware of any clear mechanism through which the director general is required to take, or indeed takes, advice from the chief scientific adviser. It also seems that the crucial necessity of ongoing consultation between members and officers of the research councils on the one hand and of advising government on the other could ultimately prove to be beyond the capabilities of a single individual, however able. Such networks as exist appear to be only vaguely defined and there are grave doubts whether these form an adequate basis for informing the development of government scientific policy.

I of course recognise that one purpose of appointing the director general was to seek to increase the efficiency and effectiveness of the councils. Whether the recent vigorous slimming down process of the headquarters staffs can be accepted as achieving this aim is questionable. Indeed, I must say with great regret that the abolition of many senior posts, including the

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decision, taken without any consultation with members of the Medical Research Council itself, to abolish the post of its second secretary is one which provoked certain council members to react with anger amounting at times almost to fury.

Leaving aside the fact that the individual concerned, now made redundant, is a distinguished physician with an outstanding administrative record, it is almost unbelievable that on the headquarters staff of the MRC there is now no medically qualified individual with clinical experience. Surely this cannot be right. And while I commend action being taken by the Government through programmes such as Technology Foresight to try to establish much better relationships with industry to enable it to capitalise upon the results and outcomes of research, and while the programme Realising our Potential is designed to assist in so-called "blue skies" research, there is a widespread perception in the science and engineering community of real or perhaps imagined pressure to divert funding from basic to applied research, despite protestations to the contrary. Such pressure, if true, would be seriously misguided since, to take the medical model, I have often said, and could quote many illustrative examples, that today's discovery in basic laboratory science brings tomorrow's practical development in patient care. The Royal Society suggests that disproportionate pressure on OST-funded agencies or inadequate responses from other government departments may seriously reduce the benefits of Technology Foresight, distort research council programmes, and lead to a divergence between OST-funded science and that supported from other sources.

Yet another major concern relates to the intimate relationship long enjoyed between the universities on the one hand and the research councils on the other. The National Academies' Policy Advisory Group has concluded that in its present state the university system will not be able to deliver what is being required of it. With the serious problems now facing clinical academic medicine, it is impossible to see how our medical schools could possibly take the additional 500 students demanded by Government to produce the doctors that the country so badly needs.

The long hallowed principle of dual support, whereby the universities were funded to provide the infrastructure and environment in which research could be carried out and the direct research costs were then paid by the research councils or other funding agencies, was eroded for good reasons when the ABRC under the leadership of Sir David Phillips recommended a transfer of those infrastructure funds from the university funding councils to the research councils in order to protect research excellence in major university departments. Regrettably, there is now clear evidence that that vital aim has not been achieved. A recent Coopers & Lybrand report commissioned by the OST has shown, as the Royal Society and the CVCP point out, that the transfer has failed to address key issues such as long-term support for the research infrastructure of the university system. In Oxford, for example, I have been given compelling statistical information showing that the university has lost annually about £1 million and

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departments in medicine, for example, with outstanding research records, have suffered severe reductions in funding. One department now finds itself with a negative departmental grant of minus £40,000, when compared with the annual grant of £120,000 it once enjoyed.

As if that were not enough, the recent decision in the current year to reduce capital university funding by 31 per cent., with further reductions in coming years, has taken no account of the fact that much of that capital expenditure goes on the purchase and maintenance of equipment used in research. Bluntly, that is the unkindest cut of all, capable of destabilising totally the cherished research council/university partnership, yet further impairing the ability of British universities to employ and deploy to fullest advantage the research skills and expertise they possess. Technology Foresight and all other programmes relating to collaboration with industry depend crucially upon that expertise.

A few years ago I was privileged to chair another inquiry by a sub-committee of your Lordships' Select Committee on Science and Technology which examined international investment in UK science. It showed clearly that, for example, 40 per cent. of all US overseas investment and 42 per cent. of similar investment from Japan in science came to the UK because of the strength of the UK science base. The factors which I have outlined this afternoon plainly indicate not just that that science base is under threat but that it is in danger of crumbling. The prevailing atmosphere of short-termism will accelerate the process.

May I invite your Lordships to examine the country's record of Nobel Prizes? UK scientists figured prominently in the lists of prizewinners for many years; but within the past few years Britain has failed to attract any such award. Now we are also faced with the prospect under Prior Options Review of privatisation of many of the public sector research establishments falling under the umbrella of the research councils. No one could object if such reviews result in greater efficiency, better science, closer relationships with industry and the universities. But up to now, the results of such reviews are not wholly encouraging. Surely the Government must consult widely about the outcomes of the reviews before decisions are finally taken to alter the terms of reference, parentage or funding of the many important organisations, while giving an assurance that any transfer costs will be covered centrally and will not erode scarce research funding.

Hence, I urge Her Majesty's Government to examine the present and future of the research councils with care and to take further expert advice. Surely, communication, consultation, collaboration and efforts to achieve consensus should be the order of the day rather than confrontation and what all too often seems to be inadequately informed decision making. If it is true that the green shoots of recovery are now becoming a flourishing crop, surely the time has come to recognise that the future industrial prosperity of this nation depends upon the health and exploitation of its science

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base and upon a growing and predictable proportion of national resources being devoted to it. I beg to move for Papers.

3.24 p.m.

The Earl of Selborne: My Lords, everyone will be grateful to the noble Lord, Lord Walton, for introducing this timely debate. It is exactly three years since the White Paper Realising our Potential reformed the research councils within a new framework. It is absolutely appropriate that what the noble Lord, Lord Walton, accurately described as "the jewel in the crown" of science in this country should be regularly reviewed by this House. We have done so over many years. I used to chair a research council, the Agricultural and Food Research Council. I remember the many debates over the years where the issues which we shall discuss today were well to the fore: shortage of funding and concern that governments were directing research councils in a way that was not to the liking of all scientists and others involved.

However, when the White Paper came out in May 1993 it was almost universally welcomed. Paragraph 3.15 recorded that the research councils had performed well but that some reform was needed; so different boundaries and new research councils were formed. There was to be a new framework for the research councils, and it is important to record that paragraph 16 stated that the research councils would operate "under the direction"--I emphasise "direction"--of the Chancellor of the Duchy of Lancaster. They have now been moved to the Department of Trade and Industry. With that came the abolition of the Advisory Board for Research Councils and the appointment of a director general, which was clearly an essential new element in the framework proposed by the White Paper.

I suspect that the reason the advisory board was abolished is that, although over a number of years it had operated with great distinction, it had nevertheless become something of a tradition that its advice was accepted almost without qualification by successive Ministers. I believe that the Minister at the time, Mr. Waldegrave, felt that in terms of accountability he should, if necessary, exercise ministerial accountability over the deployment of funds on the science base. For that reason, rather than perpetuate the advisory board, he moved to something which could clearly be described as closer to a process of direction under the Chancellor of the Duchy of Lancaster. The Minister could have done something more radical; and in many ways, if the perpetual issue is the funding of research councils, as the noble Lord, Lord Walton, correctly explained, what needs to be done is to bring science right into the mainframe of public interest and give it as much political clout as possible. Had that been the objective, it might have been desirable to form one research council. In other words, instead of having six research councils we would put it all together as one research council. After all, that is the United States model with the National Science Foundation. We would then have had a chief executive who would have known precisely

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where he stood with the Government. The slightly anomalous role of director general would not have been a problem.

We could have gone even further and taken some of the departmental research out of the departments and put it into a ministry for science, with the research councils. With hindsight, I suspect that would have been a more satisfactory way of resolving, for example, the BSE problem which has clearly fallen between ministries and has lacked a co-ordinated approach from the centre, despite the best endeavours of the Chief Scientific Adviser. That would have been another, more radical proposal.

A third proposal put forward by a number of people in the period of consultation before the White Paper was published was that all curiosity-driven research should be put into a separate funding council. That would have undermined the dual funding system for the universities, and many of us are grateful that it and the other radical proposals were not implemented. However, the objective would have been to try to ensure that research, the science base, received the hearing and influence in government that we all felt it deserved.

Nevertheless, the White Paper was widely welcomed because it rejected the more radical options, yet it demonstrated clearly a commitment to the research council structure and a commitment to consensus. That must be emphasised because Technology Foresight and a number of other initiatives are nothing if not consensus. It represented a format for the future which we all welcomed. My predecessor as chairman of the Select Committee on Science and Technology, the noble Lord, Lord Flowers, wrote to the Minister at the time on behalf of the Select Committee. His letter states:

    "We positively welcome the internalising of the Advisory Board for Research Councils within the Office of Science and Technology and the appointment of a director general as steps in the direction of the unified research council structure which we have long advocated".
The letter went on to give specific proposals as to how the research councils' proposed structure might be modified, some of which were taken up by government.

I welcome the fact that the Government did not take a more hands-on approach, as they could have done at that time. However, there is a very fair criticism to be made of a number of ways in which government have--not "interfered"; that would be an incorrect word--influenced the science structure in an unhelpful way. That is true in one area to which the noble Lord, Lord Walton, referred; namely, continuous prior options review of public sector research establishments. Originally it was not intended to include many of the research council establishments. It has now been going on for two years. That seems an astonishingly long time to bring this degree of uncertainty to an area in which, quite frankly, research councils are quite capable, with suitable encouragement, of restructuring themselves.

When I was involved with the Agricultural and Food Research Council we went through a very far-reaching restructuring programme. It was painful but necessary. It demonstrated that with the right signals from

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government it could and should be done. It was very much faster than the long drawn out process that is going on at the moment.

The problem is not between the boundaries of research councils or even the battle as to whether the director general is exercising too much or too little influence. The real battle is how the research councils exert adequate influence when it comes to the distribution of public funds.

The noble Lord, Lord Walton, was very fair. He told us at some length of all the difficulties into which the Medical Research Council, and I suspect other research councils, have fallen of not being able to fund as many research projects as they wish. I admit that in the last PES bid the Science Vote did less badly than many other sectors. I shall not put it more strongly than that. So do not let us think that the research councils were discriminated against at the expense of many other sectors.

The battle is with the Treasury. It always has been and always will be. We are trying to get the Treasury and our colleagues in Parliament to understand just how important the role of the science base and the research councils will be in wealth creation and the quality of life. Instead of continually worrying about people encroaching onto their turf, the research councils should recognise the need to put together a concerted attempt to influence funding very much more directly than they have in the past. Perhaps we could persuade government not to keep meddling with the framework. Radical changes were made in 1993 and were widely welcomed. For goodness sake let us keep them. If we keep existing structures and continue, united, to make a case for further funding for the science base, perhaps we shall have more hope of success.

3.32 p.m.

Lord Winston: My Lords, I express my deep gratitude to the noble Lord, Lord Walton, for introducing this most important debate. The technological and scientific base of our nation is increasingly vital. It is important for our well-being and crucial to our place in the world. I shall confine my remarks to the activities of the Medical Research Council, the research council that I know best. I agree with so much of what was said by the noble Lord, Lord Walton, that I fear I may be repetitive; I hope that that will not be the case.

My own origins in medicine depended in very great degree on the Medical Research Council. My career as a junior research doctor was influenced greatly by the MRC. Briefly disenchanted with medicine, I toyed with the idea of giving it up and going into the arts. I must say, having looked at the press coverage yesterday, I wonder whether perhaps that would not have been such a bad decision after all!

In 1971 and 1972, as a junior doctor finding medicine rather unstimulating and unchallenging, I had a completely hare-brained idea which a rather supportive chairman of department suggested ought to go to the MRC for funding. The resulting grant supported my salary and activity for two years. It came as a complete

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surprise to me. Largely by luck rather than intelligence, the work turned out to be extremely influential and achieved some international recognition. It led to a line of research which dominated my work for over 10 years and led me further into the area of academic medicine that I am in now. Looking back at my time as a student, my contemporaries would have roared with laughter had they seen me as a professor of medicine, particularly in a highly-rated, HEFCE institution such as the Royal Postgraduate Medical School.

What is more pertinent is that I doubt very much whether there would be the slightest chance of my receiving that grant now. I was a relatively new graduate. I had never published a paper. I was working entirely with novel equipment which did not seem to work and nobody had seen before, and in a department with no track record in the field in which I was interested. I do not doubt that now, given the financial worries of the MRC and the knowledge that the great majority of alpha-rated grants--even those coming from scientists and physicians with great track records--would have a very significant effect on people like myself applying. I am sure that not only are we turning away important scientific ideas but also, more importantly, the budding young scientist whose maximum potential in some cases is lost to our economy.

I do not argue against selectivity. No doubt the best science is done where there is a critical mass, the best infrastructure, collaboration, communication and, above all, contacts. Moreover, it is probably true that only the large, well-rated institutions will be able to give young scientists--after all, much good science is essentially the endeavour of youth--time to think, apparently for a good part of the time, without obviously being productive.

Nevertheless, I should like to mention one or two caveats. One matter that concerns me slightly is that we have to be on our guard against an oligarchy in science which promotes its own people and its own ideas at the risk of ignoring much good in the wider educational community. That is much more likely to happen when funding is short. The MRC is a rightly applauded institution. It has produced, and continues to produce, our best medical science. That science is the envy of the world. It is probably equalled only by the National Institutes of Health (NIH) in the United States, which have far larger resources. Even though I shall go on to criticise some aspects of basic research, it is crucially important that the MRC is given a free rein in regard to such research. How could we deal with BSE if we did not understand the issue of prion disease?

The MRC's mission, as set out in its charter, is:

    "to promote and support, by any means, high-quality basic, strategic and applied research and related postgraduate training in the biomedical and other sciences with the aim of maintaining and improving human health".
That is a most important and distinctive mission.

Nevertheless, I have some slight concerns. Since the Government White Paper in 1993, Realising our Potential, the MRC invariably seemed to react by

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tacking onto its mission statement the aims that appear in its corporate plan. I quote from it briefly since it is relevant to its activities:

    "to advance knowledge and technology, and provide trained researchers, which meet the needs of users and beneficiaries (including the providers of health care, and the biotechnology, food, health-care, medical instrumentation, pharmaceutical and other biomedical-related industries), thereby contributing to the maintenance and improvement of human health, the economic competitiveness of the United Kingdom, and the quality of life".
That is an entirely laudable mission. But in practice how is the MRC implementing it? That is one of the problems given the resources at its disposal.

Last year, £52.1 million was spent on molecules and cells; £21.3 million on the control of development, molecular genetics and the mapping and sequencing of genes; £49.4 million on infections and immunity; and £50 million on the molecular and cellular aspects of the neurosciences. But only £4.4 million was spent on health services and public health research--the very area that is now mentioned in the mission statement.

These are huge basic research programmes. They are terribly important. But it is hardly surprising that some Members of the other place find little that is really relevant to British health and criticise the MRC. We as scientists, with the MRC, need to go out and sell these basic programmes. But we also need to look more at how we can interface across the board.

It is perfectly true that this Government produced the research and development arm of the NHS. It is greatly to their credit that they did so. It has done exceptionally well and was a most important manoeuvre in the financing of some of the sort of research that I do, which also comes from that source. But there still seems to be too little genuine contact between the endeavours of the MRC and those of the NHS. There are too few MRC programmes of stature, such as that seen in the excellent clinical research initiative. The clinical sciences centre at the Royal Postgraduate Medical School, is an example. That is almost unique but it should not be so. Here, at least, there is a genuine interface.

The MRC seems to some people to be a somewhat arcane institution. Noble Lords will be aware that the map of Africa shows countries which are composed of largely vertical and horizontal lines in many places. That is a legacy of former decisions of bureaucrats. Sometimes the MRC almost seems to work in the same way. It is to be hoped that that perception is changing but it is still as though they are taking yellow fever jabs when they should be thinking of malaria and cholera. It is a remote organisation. As the noble Lord, Lord Walton, said, far too few of the hierarchy in the MRC come from a medical background. That is most important if we are to promote the interface between the MRC and the health service. I do not believe that the head office has entirely the right skills to carry out the mission statement as it stands.

There is the problem of what attracts funding. On occasions, it is difficult to find out why one's application has been turned down. I must say that the MRC is now more accountable than sometimes it was formerly. But I must also ask whether the method of peer review in camera is an entirely fair one. Why

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should referees of scientific projects wield such power and do it so anonymously? I wonder whether peer review might be looked at. Perhaps it might be better conducted by having the reviewers place their signatures to their opinions. That would reduce bias, increase accountability and might make for fairer application of resources. There are difficulties with that. I can imagine how many referees would object. But I believe that it would still be possible to get high quality reviewers.

The trouble is that we, as successful medical academics--those of us, like myself, who have MRC grants--connive at the system. We are successful with it and we benefit from it. We too, like the people at head office, read Nature, Cell and Science, which are esoteric medical journals. But there is a tendency to forget the Lancet and the British Medical Journal. I sometimes wonder how many people at head office read the British Medical Journal.

I believe that the Medical Research Council, like all the research councils, is hampered by being within the DTI. I do not feel that the relationship can be in the best interests, for example, of education, health, agriculture or, indeed, in some respects, industry. There is a case for going back to the notion of some kind of separate department for science and technology. There would be a very good case for Cabinet rank for somebody to represent it. That would need to interface most closely with other departments. But it could promote our expertise and give a higher profile to these important endeavours. It will be vitally important to our economy in world terms. Indeed, it is one of the few areas left where, provided there is adequate education, we should continue to be among the most productive nations.

3.42 p.m.

Lord Kirkwood: My Lords, I too am grateful to the noble Lord, Lord Walton, for instigating this debate on the research councils. Much of what I have to say is drawn from a memorandum published recently by the Save British Science Society, an organisation supported by many leading British scientists and engineers, which also has industrialists among its advisory councils. It not only expresses my own views clearly and forcefully but, I believe, the views of a great many academics working in the universities. I commend it to anyone who has a serious interest in the subject.

My first point concerns the proper role that the science base should play, the science base being the research activities in universities supported by public funds from the research councils. Its essential task is to carry out long-term basic and strategic research in science and engineering for the United Kingdom, as other noble Lords have mentioned. In so doing, it discovers new knowledge and develops new technologies.

In my view, its primary objective should not be that of wealth creation. That is the business of industry. However, it should provide options for industry to select promising new or improved products and processes. I am, of course, talking about the field with which I am in contact; namely, the physical and engineering sciences.

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Communications at the interface are vitally important for technology transfer. Great effort on technology has gone into that area to make it more effective. Confusion in the role of the science base has crept into the thinking of the DTI as more research programmes are being funded which are narrowly industrially focused with short-term goals at the expense--because there is no new money--of broader speculative projects which have originated mainly from academics and been assessed by peer review.

At this point, I emphasise that I am not against industrially oriented research being carried out by universities but only the scale and the narrowness of vision which seems to have developed. I have spent some 35 years of my career in university as a metallurgist carrying out research in the applied sciences.

At the beginning of my career I was well aware of the freedom essentially to choose any research topic with SRC funding--it was SRC in those days--to the extent that research became incestuous. The last topic would breed the next one, without any reference to the needs of society or industry, which we have some obligations to serve. A degree of freedom is healthy, particularly for a young person at the start of his or her career. But I feel that it went too far. The introduction of the so-called "CASE" awards, whereby industry could top up an SERC studentship and have some say in choosing the research topic and monitoring its progress, was very healthy for science and technology in universities. Nevertheless, it was still academic research with the aim of seeking new knowledge generally. It was not specific to the industrial partner and there was the freedom ultimately to publish.

For academic researchers that partnership is a wholly good thing. It brings them nearer to the needs of industry without constraining the requirement to publish and discuss the results with colleagues everywhere. It is often not understood how important are those freedoms to the health and vigour of academic research in all subjects. In particular, sometimes it is not fully appreciated by industry, whose culture is understandably more secretive, and much industrial research does not see the light of day outside the company premises.

The movement towards more industrially oriented research has been continued and expanded, first by the SERC (Science and Engineering Research Council) and now by EPSRC--the inclusion and the predominance of "E" for engineering in those acronyms is no accident--and usually involves larger and more costly projects, employing more senior research staff. But the ideas would originate in partnership between industry and university.

With the arrival of the Technology Foresight exercise and the projects which emanate from it, we have moved into a different world. They are tightly focused and controlled projects, clearly aimed at the perceived needs of industry, with explicit concentration on wealth creation in the short term. There are a number of causes for concern with that initiative. First, it is notoriously difficult to guess winners in the technology stakes. Secondly, because there is no new money, inevitably the

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more speculative longer term projects are pushed to the fence. That means that industry has fewer horses on which to place its bets and, since the later stages of industrial research and development are much more costly, mistakes in backing the wrong horse can be disastrous. I should say that the horse racing metaphor is quite appropriate to this game. Technology spotting is and always will be a gamble, no matter what high hopes and what good preparation has gone into the matter.

Despite what I have said, I am not trying to deride or devalue the Foresight exercise. It needed to be carried out. It is good that industrial and academic scientists and engineers meet and thrash out what they believe to be the priorities for applied research in the United Kingdom and to publish their conclusions. However, I feel that the specific recommendations should be taken as provisional, always subject to revision by a continuing exercise and not be set in tablets of stone. It is the rigid distortion that it can give to the direction of all the science base that most worries me and others.

I shall conclude by saying something briefly on the budget allotted to the research councils. It is true that it has grown in the nine-year period to 1995 by some 8 per cent. But it is a paltry amount considering what needs to be done to bring the level of university equipment and facilities up to international standards. The fact is that, according to OECD data, it would need an additional 40 per cent. of funding to bring the UK into line with the average figure for the USA, Germany, France and Italy as a percentage of GDP. It is now proposed to reduce that funding over the next three years by £56 million. That sum is not only to pay for a much enlarged university sector, but in addition the government research establishments of other departments are now encouraged to bid from the same pot, reducing the amount that they will need to spend on research themselves in the future. Again, much of the research will be of the short-term, industrially oriented type, to the detriment of longer-term basic and strategic research.

There are many who believe that this could spell the end of our glorious tradition of scientific discovery, which is the real source of technological revolutions, unless drastic measures are taken to reverse the concentration on short-term and short-sighted research.

3.52 p.m.

The Earl of Clancarty: My Lords, I thank everybody for the kind welcome given to me. Also, I thank my noble friend Lord Walton for initiating this important debate.

Prior Options Reviews of the public research establishments have now been set in motion with the aims stated in the 1993 White Paper Realising our Potential. This Government's policy is to provide,

    "only those functions which are both necessary and best carried out in the public sector".
What, without doubt, is most at risk is pure scientific research or perhaps, in the end, even a notion of pure scientific research. I say "notion" because I think there

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is some confusion about, and not enough consideration given to, what we actually mean when we talk about core science, pure science or so-called "blue skies" research. The former science Minister, David Hunt, stated last year:

    "I do not want to stop purely curiosity-driven research".
But that oft-used phrase, "curiosity-driven research", unthinkingly belittles and somehow compartmentalises this kind of research.

It may seem strange or foolhardy to those noble Lords to whom I have spoken that someone working in the arts should make their maiden speech in a science and technology debate. But, as I am perhaps hinting at already, there are certain general cultural assumptions which underlie our thinking, whichever side of the debate one is on, which I feel need to be somehow "got at" and which a broader view may help to illuminate.

An artist friend said to me that at least in science there is the perception of pure scientific research against which there is a threat. In Britain in the arts, both for the general public and for most people working in the arts, there is no such notion of a perceived long-term research being carried out in the first place. I am not thinking here of art history and other retrospective disciplines. In both art and science new understandings are brought about through new movements which may themselves be part of a long-term development of thought. I make these points to suggest that we have strayed a long way from what we acknowledge traditionally as being a Renaissance-style science.

The kind of science that is favoured is prescriptive; that is to say, industry requires a product. When we say it wants a return on its investment we can take the word "investment" quite literally. Industry will clothe and recharacterise the work that is carried out towards a particular end. But we could talk positively of science as a rhizomorphous activity: it proliferates; it is nomadic; it is inefficient; it seems to have no beginning or end.

The chief executive of one of the public sector research establishments was quoted in the Daily Telegraph as saying:

    "I would be suspicious of a scientist who could not explain why the work was being done in the first place".
Yet, in my view, truly pure research is carried out for just that reason--to discover what it was that drove the scientist down that particular path, one that is necessarily dark at the end. It is a journey of which we can say one cannot necessarily predict the route one will take--some routes will be totally new--or predict the destination, and perhaps there is no destination. A purely commissioned research takes away the freedom of the mind.

Perhaps the most important problem of all is that of time, the time that is needed to develop a project. Customer-driven research means not only a specified product but also that the product needs to be on the table at a specified time. The preference for immediate results is the desire for instant gratification. A scientist needs time because so much work of importance is done in the dark, with the possibility that a result of the kind that industry would like to see may never be achieved, or

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perhaps not recognised at the time for what it may later become even by the scientists who are themselves working on the project.

On being asked, "What use is electricity?", Faraday famously, if rationalistically, replied, "What use is a newborn baby?". But perhaps even Faraday's perspective is the wrong one. I would argue rather that the meaning of the work lies not in any potential outcome that can be bargained for with industry (and I sense that defensiveness in all the various reports and statements that emerged from the PSREs which are so rightly concerned with the effects that privatisation would, and in some cases now will, have), but in the work itself and in the relationship between the scientist and his or her work. The product, the outcome, finally is the work itself. That is the meaning of the phrase "pure science" and constitutes the essential difference between core science and commissioned research.

The kind of science that is favoured is also functional. The structures and methodologies used will influence the outcome. I believe that certain forms or appearances simply cannot occur under certain conditions. In other words, if the Government want to make funding decisions based on questions of, for example, functionality or efficiency, then an overall decision has in effect already been made which is truly a cultural one.

With my emphasis on pure research, I certainly do not wish to deny the use or the results of industry-financed or commissioned research. Rather, there is in a PRSE such as the British Geological Survey a fragile and subtle relationship between, on the one hand, the so-called "core programme" and, on the other, commissioned research--what the BGS calls a "synergy". To tamper with one will radically alter the character of the other.

To take the broader view again, there is no Minister for the Arts but one for heritage. The Office of Science and Technology is now part of the Department of Trade and Industry. The link here is the tendency towards a purely retrospective culture: the desire to capitalise on the result before formulating the question.

Finally, it may be said that the culture of a nation is defined not in what is deemed to be necessary for the life of the country in terms of its economic production but in what may be regarded as its excess. Certainly this Government regard as excessive the idea of a truly pure science. But by doing so they reject the wherewithal to solve the longstanding and wide-ranging problems it purports to address.

4 p.m.

Lord Desai: My Lords, it is more than a privilege--it is a pleasure--for me to congratulate the noble Earl, Lord Clancarty, on his maiden speech. When I came into the House this afternoon, I looked at his entry in Dod. I had very little guidance as to what I was to expect. He is so modest that he says very little about himself. But now that he has given us a very thoughtful, interesting and surprising speech, I hope that we shall hear more from him on other topics.

I must declare an interest. I have received money from research councils for carrying out research. Indeed, I am about--I hope I am about!--to do so again. I come

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from the social science side and not the natural science side. The difficulty about funding research was set out by the noble Lord, Lord Kirkwood, with whose speech I very much agreed, and by the noble Earl, Lord Clancarty. The difficulty is that people who should invest in pure research have to realise that it may or may not yield fruit. If it yields fruit, it may be a very handsome fruit.

The rates of return for basic research are not measured in double digits. They are very often measured in four or five digits. Basic research is very fruitful if successful. However, at the same time, one has to gamble and take a risk that what one is doing is not throwing money away but will be useful. Practical men--usually men make these decisions--want to have a preliminary assurance that the money they are giving away will not be wasted. The only way to do that is to make quite sure that the selection of people who get the money is above board and that the selection is such that we can best expect good results, although no one can ensure good results.

Here I must disagree with my noble friend Lord Winston. I believe that the peer review procedure with an anonymous referee is the only guarantee I can give to the practical men that I will do the best I can and that we will all do the best we can. It is an uncertain thing to predict. No one knows the answer, but we can at best give a collective answer uninfluenced by the fear that we might meet the man in the street who has just rejected us. An objective and anonymous peer group procedure has so far been the only guarantee.

Where I believe we have gone a little wrong--I echo what was said by the noble Lord, Lord Kirkwood--is that we have jumped the gun. We have said that it is not enough to have a peer group review procedure and it is not enough to trust the scientists, that we have to foreshorten this gap between basic research and the final product, that we have to have a practical test, and that research should be results-oriented and not knowledge driven. Very good arguments have been made as to why that is wrong. Perhaps I may push the argument in an area where our industry thinks it is totally useless--social sciences.

Social sciences include sociology and economics. It is hard to argue that we could be useful and therefore we have to try even harder to be practical. I believe it is a mistake to pre-judge these issues. Perhaps I may give an example which is to do not so much with research but with economic study. When I was a member of the London University Senate the vice-chancellor said, "We have been told by the Secretary of State for Education that universities ought to pursue practical subjects". The person in question said that he agreed. I said, "Why did you agree? Theology is not a very practical subject. Islamic theology is even less a practical subject. But when Ayatollah Khomeini came to power we were looking around for anyone who knew something about medieval Islamic theology".

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It takes 10 or 15 years to produce a scholar in Islamic theology, central Asian republics or the problems in Rwanda. When problems arise one cannot then start research. By the time the research is finished, the problem is over. One has to be able to anticipate.

Of course the money is limited. I know that. But because money is limited, we should not try to shape research in a certain results oriented fashion but instead have faith in the academic scientific community we have created. We could then have a review now and then to see how effective it is. I would never have predicted many of the things--good and bad--which governments have been able to do. It would have been impossible to anticipate them.

The money spent on research is vital not only because it goes on useful research but because in universities there has been a climate on the teaching side, which we are not discussing this afternoon, of severe financial cuts. We are told that we should get capital grants from the PFI. That is good for the Government and it is good for the PSBR. But it is not good for the universities because they will not get the money. The money will have to be found somewhere else. That will not be good news for us.

Perhaps I may put another point to the Government. The Government will say that I should know that money is scarce. I have heard all that before. I hope the Minister will not ask me how my party will pay for everything, because even if I told him, I am speaking from the Back-Benches. The Government spend an enormous amount of money on hiring consultants. They only hire consultants who are not in universities. The consultants who are not in universities cost about 10 times as much as the universities would cost and are not as good. It is surprising that universities are not used more often in giving the kind of advice they could give. That would generate revenue for them and the Government would save a good deal of money. Perhaps a few City firms would go bankrupt, but that is not always a bad thing.

The Government should make more active use of the universities because the expertise is there. I can tell the Government that it would be very useful and cost efficient. I believe that we ought to discuss research not in a narrow result oriented fashion but in a broader fashion. Everything I know about the roots of growth tells me that money spent on research will be handsomely repaid and will be repaid much better than money spent on many other activities which the Government think are more practical and more useful.

4.8 p.m.

The Earl of Carnarvon: My Lords, I should like to add my congratulations to the noble Earl, Lord Clancarty, on his maiden speech and hope that my fellow Cross-Bencher will take part in many more debates. Before taking a small part in this debate, I must declare an interest to the extent that I own a beef herd as part of my farming activities.

Between 1978 and 1982, I was chairman of the Agricultural Research Council, which changed its name, as the noble Earl, Lord Selborne, said, to the

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Agricultural and Food Research Council. At that time, there was a possibility of work being done on scrapie at Mordun and Compton being considerably reduced. Luckily for all of us, the work of this very important basic research continued.

The present story of bovine spongiform encephalopathy and Creutzfeldt Jakob Disease is a good illustration of the role of a research council in supporting research on a broad front and of research institutions providing national facilities and expertise to pursue this long-term research.

The AFRC support for the research on scrapie at Compton and more recently, the Biotechnology and Biological Sciences Research Council and the MRC in Edinburgh, meant that in the late 1980s they were able to initiate almost immediately a programme of BSE research at the neuropathogenesis unit and at Compton. Without this background, the lead time would have been very considerable. In addition, the NPU is well placed to collaborate with MRC's CJD surveillance unit, which is also in Edinburgh. The lessons in this for long-term basic research and the research institutes are very clear.

A current worry for the research councils is that in pursuit of its privatisation policy the Government might--and I underline "might"--break the links between the research councils and their institutes, making the institutes independent and leaving them to compete on the research market.

However, the real test of the DTI's intentions will be its attitude towards the councils substantial funding for basic research, mainly in the universities. Up-to-date, the DTI and the Minister for Technology have supported these activities: long may this policy continue.

On a topical and worrying note: yesterday, I watched BBC television and heard the newsreader at lunchtime referring to a group of people about to take actions against the Government regarding the deaths of relatives due to CJD. The newscaster explained that CJD was,

    "the human equivalent of mad cow disease".
This was most inappropriate and seriously incorrect. I hope that the Minister will look into this definition, which I heard repeated on BBC 5 on my way up in the car yesterday.

4.12 p.m.

Lord Peyton of Yeovil: My Lords, I congratulate the noble Earl, Lord Clancarty, on his very thoughtful and interesting maiden speech. I do not doubt that there will be many other occasions when he will be listened to with equal interest. I also wish to thank--I call him "my noble friend" because I have known him for a very long time--Lord Walton, for introducing this Motion and for moving it in a speech which was wide-ranging and penetrating. I earnestly hope that my noble friend on the Front Bench will take that speech back to some of his colleagues, put it in front of them and leave it with them until he is sure that they have read it many times and digested it.

What bothers me--and I lack the expert knowledge of the noble Lord, Lord Walton--are the attitudes which prevail towards research today. We live in an age of

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change, rapid reaction, quick results, which we hope for from limited resources and, above all perhaps, instant and unceasing communication. It is not surprising that Ministers are affected by that state of affairs and as a result they develop skills in self-defence and presentation; what I fear is that they devote an excessive amount of their time, attention and energy to cosmetics rather than to fundamentals. I say that about Ministers of all parties, over many years.

It is hard to imagine a climate more hostile or unfriendly to research or one which is less in tune with its needs. As I have said, I am no expert in this area but I have been chairman of a charitable trust over the past six or seven years. During that time I have learnt something of how important an assurance of continuity is and how desirable is flexibility. Without flexibility, research tends to be set on tramlines and comes up against insurmountable obstacles; with flexibility sometimes it is possible to get round them. I have found again and again that people with great skills to whom I have been able to give support have found that support doubly useful because they were not constrained too closely to follow preconceived directives.

I do not mean this in an offensive way, but I do not believe that I really understand the Government's attitude to research, either what they expect from it or what they are willing to provide; neither do I quite understand what they expect from the private sector. I do not believe that private sector funding will be in a hurry to replace government funding, nor do I believe that it will be attracted easily to funding deficits.

I would like briefly to refer to a Question which the noble Lord, Lord Walton, mentioned which I asked on 19th March. On that occasion my noble friend on the Front Bench very reasonably gave the unassailable answer:

    "the MRC must live within its means".--[Official Report, 19/3/96; col. 1145.]
The questions are these: are those means sufficient for it to carry out its task; and can we possibly be content with a rejection rate of 70 per cent. of alpha-rated projects? I believe that the answers must be emphatically no.

I echo what the noble Lord, Lord Walton, said on that occasion; that the 30 per cent. cut-back in capital funding for the universities must have a huge and radical repercussive effect on the research activities of our country as a whole. I would particularly like to echo, too, the words of my noble friend Lord Jellicoe. He said:

    "if the rejection trend persists, there is a real danger that there will be an erosion of our once dominant position in the field of basic medical research".
He went on to comment,

    "how deeply disappointing [it is that] some of the brightest and youngest minds working in the field to see top-class applications rejected".--[col. 1146.]
I do not believe that the official world is in any way aware of the depth of that disappointment, which causes me again to echo what the noble Lord, Lord Walton, said about the recent transfer of the Office of Science and Technology to the Department of Trade and Industry. I have absolutely no desire to be offensive, but

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I cannot restrain myself from saying that that department is a very large one. It does a great many things, and I do not believe that it does any of them very well.

Research is complex, depending as it does on resources in terms of buildings and equipment and on people in terms of management, leadership and vision. All of those aspects do not run on the same plane or to the same timescale but there is a close relationship between one and the other. It is a relationship with which others tamper at their peril--or rather at our peril.

Such matters may not be of much concern to those who in our day simply seemed to want to win a place for themselves rather than to plant seeds for the future. Attitudes will have to change if we are to succeed in realising our potential. Indeed, the phrase "realising our potential" is, as your Lordships will recall, the title of one of the glossy papers which are now fashionable in government circles.

I hope that the time will come when research will be seen generally as a major contributor to wealth and to the quality of life in our country--not just as a sponge absorbing resources which could be more effectively dedicated to causes which would more readily win immediate and popular acclaim.

4.21 p.m.

Lord Porter of Luddenham: My Lords, I too thank the noble Lord, Lord Walton, for calling attention to the present position of our research councils and for initiating this extremely interesting debate. These councils are the mainstay of research in our universities, which in turn provide the knowledge base on which modern technology and industry depend.

Until relatively recently this system operated on the Haldane principles which aimed, to quote the noble and learned Lord, Lord Hailsham--I hope that I quote him correctly--

    "to separate the activity of research from the executive business of government and from economic activity".
It had the confidence of the scientists and it worked very well, so well that this country led the world not only in the advancement of science but also in its practical applications.

The allies' success in the Second World War owed much to the British men and women who gave us radar, polyethylene, penicillin and the jet engine. Even in the stress of war the boffins were free to develop their crazy ideas and Government Ministers and industrialists joined in the fun, and the record of success under that system was remarkable.

So, what has gone wrong? In basic science, we no longer lead the tables of international awards. As the noble Lord, Lord Walton, pointed out, up to the 1960s Britain held the most Nobel prizes per head of population of any country. We expected, and often got, one or two of these each year, but the last award in this country for chemistry was made 14 years ago in 1982 and for physics in 1979. Things are not much better in applied science. We hear a lot about Nobel prizes, but the picture is not much happier when it comes to applied

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science. With the notable exception of pharmaceuticals, most of our industries have little to show today that compares with their great innovations of the past.

How did that happen? We still have good scientists in our universities and we still have the research councils which provide, I have no doubt we shall be told, similar overall funding in real terms to that which they provided in the past.

Could it be that our politicians try too hard? With the best intentions they seek wealth-creation from a chemist from the moment he opens a bottle. There is a danger that the research councils will be guided in their pursuit of government gold by short-sighted foresight committees. It has been said that if, when he discovered the electric dynamo, Faraday had been guided by a committee seeking a brighter light, he would have been advised to develop a better candle.

In the late 1930s President Roosevelt set up a high-level committee of scientists and industrialists to do just what we have been trying to do--to predict what the future trends in science would be. They guessed correctly how some areas of existing technology would develop and incorrectly about others. What is more worthy of note is what they missed--and that was practically everything of importance. They missed penicillin; they missed radar; they missed the transistor; they missed rockets and satellites; they missed nylon and other synthetic fibres and plastics; they even missed nuclear power and nuclear weapons--and this was only a few years before the Second World War.

I hasten to say that the British technology foresight programme has been successful in the way which I believe Mr. Waldegrave intended. I remember his telling a Select Committee of your Lordships' House that the importance of the programme would not be its conclusions but the process of catalysing a dialogue between scientists, technologists, government and industrialists. This was a laudable aim, which was achieved in part. But the later decision to shift the Office of Science and Technology to the Department of Trade and Industry, with an overarching director-general, seemed to give the wrong message about the Government's intentions for basic science and the research councils.

I should like to quote a little more from the recent report on this matter from the Royal Society, to which the noble Lord, Lord Walton, referred. It states:

    "Technology foresight is about markets and about technologies. It is not science foresight, i.e. it does not attempt to predict how scientific knowledge will develop. Nor could it. The identification of strategically important areas of technology raises, but does not answer, questions about the science needed to underpin these areas of technology".

In the end, however inadequate the funds available to the research councils may be, they must be spent wisely. I believe that that is part of the problem. The priority must be the best basic science and scientists in the universities rather than the committees' own favourite programmes. Neither should they support institutions or well-found laboratories, least of all their own, merely because they are well found, and expensive usually. There is no way in

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which we can afford to make 100 universities centres of excellence in modern science, and equality of funding is neither possible nor desirable.

Finally, to optimise this process, the industrial laboratories must support more generously their own in-house research, as well as university research which is done mainly for their benefit. After all, they should know best how to create wealth from their own products.

4.28 p.m.

Lord Sewel: My Lords, I join other noble Lords in thanking the noble Lord, Lord Walton, for providing us with the opportunity of this debate. I should declare an interest as a member of the University of Aberdeen. Perhaps I should also point out that the research council has from time to time supported my research, but has more often declined to support it.

I must also agree most strongly with the noble Lord, Lord Peyton, who drew attention to the demoralising and demotivating effect on young researchers at the beginning of their careers when they find that, after considerable effort and the submission of a good research application, that research application is rejected. Part of my job is to encourage young researchers. I am aware of the negative effect that that kind of response breeds. It takes a good deal of effort to galvanise them again.

Quite understandably, many of the speeches in today's debate have drawn attention to the work of the science and technology-related research councils. As a social scientist, I should like to say a few words about the Economic and Social Research Council which in funding terms is very much the Cinderella of the research councils. Relationships between government and the social sciences have not been unproblematic, in part perhaps because social scientists sometimes have to say things that governments prefer not to hear or to learn, and in part because in areas of public policy the approach of government has been to come up with the policy and then to scurry round to find justification for it. It will be recalled that in the 1980s the situation became so bad that the then Social Science Research Council was required to change its name and became the Economic and Social Research Council. At the same time, its budget was cut in half. I believe that those days are over. I detect a change of mood. There has been a growing recognition of the contribution that the social sciences can make in seeking solutions to, and providing an understanding of, some of the major problems that confront our society. Nevertheless, the ESRC remains the Cinderella of the research councils. The social sciences account for only 5 per cent. of the science vote, despite the fact that people-related problems represent more than 5 per cent. of the factors that inhibit our country's future industrial, economic and social development.

A sign of the change in mood was the article published a year ago in Nature. That is not by any means a social science publication. The article commented on the Government's Technology Foresight programme, and noted:

    "... almost all of the 15 panel reports make recommendations that fall within the remit of the Economic and Social Research Council. That is not surprising. To the extent that the panels are as much concerned with the neglect of technology that already exists as with

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    innovation in the strict sense, it is natural that they should be concerned with the improvement of the social climate for economic activity. ... On the face of things, this common theme implies a bigger budget for the smallest of the Research Councils".
A year on, recently in Research Fortnight--which is the insider publication for the research community--the comment was made,

    "It is now perfectly clear that the country's need and appetite for social science research is bigger than ever. The Council could have its budget doubled over the next five years and make every penny pay for itself over the coming decades in lower crime rates and better management of the economy to name but two".
One could name many more to add to that list.

In many cases the advances in scientific, technological and medical knowledge can be maximised only through the activities of people as individuals or as members of organisations. Much depends upon the social processes of innovation and diffusion and--perhaps most importantly--understanding of the means by which behaviour, both socially and personally, can be changed. It is evident that the ESRC and the social science community has responded positively to the Government's White Paper Realising our Potential. Following widespread consultation, the council identified nine thematic priorities which represent the big issues that will face British society over the next few decades. Without listing all of them, one can gauge the importance of them by looking at four of the main topics that have been identified: economic performance and development; the environment and sustainability; the social shaping of technology; and social integration and exclusion. I am convinced that that will address the fundamental problems and issues in determining the nature of British society.

As the Minister well knows, I come from Aberdeen. About 10 years ago we lived through the "Piper Alpha" disaster. The subsequent Cullen Report graphically identified the crucial and critical role of human factors in the circumstances surrounding that disaster. I believe that we have learned a lot from Cullen, and that human and social factors are now recognised as having central importance in the whole area of safety engineering and management generally. Technological engineering structures are important, but their importance is mediated through the behaviour of individuals. That is fundamental.

It is a truism that our society is changing more rapidly now than many times in the past. Often we understand little about the process of social change that goes on around us. Many changes cause individual personal despair and often a fractured society. Perhaps more than ever before we need high quality, robust and properly funded social science.

4.37 p.m.

The Earl of Halsbury: My Lords, I express gratitude to the noble Lord, Lord Walton, for enabling me to address your Lordships' House on a subject in which I have been engaged for so long. The noble Earl, Lord Selborne, speaks for the present. I am a voice from the past. I first made contact with the Department of Scientific and Industrial Research in 1949, nearly half a century ago. I did a stint on the advisory council and

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had a second term on the Science Research Council, then under the chairmanship of Sir Harry Melville. As he was about to retire, I was one of a deputation of two who went to the Minister to ask whether the noble Lord, Lord Flowers, could be the next chairman and whether he could have the status of an executive chairman. (I see the noble Lord in his place. If I misquote anything, I shall give way if he wishes to rise to correct me.) Following that, I spent a further five years on the Medical Research Council. It was there that I met the noble Lord, Lord Walton, for the first time. In addressing your Lordships this afternoon, he and I speak as old colleagues on all that we have worked on together in years gone by.

The noble Earl has referred to still more messing around as of today. I have with me all of the command papers that have been reported to Parliament on the subject of the organisation of scientific research: three, six, nine, 12, 13 and 14. There is one report to which I cannot get access for the time being. The rest of them are out of print. The reports go back to 1962, which means that since then there has been one decision every two or three years. As the noble Earl said, we are at it again. Not content with the 1993 reorganisation, here we are in 1996. We have interfered with it and sent proposals for the Department of Trade and Industry to take over. We are messing around again.

It is as well to look at the received wisdom of a distinguished public servant, Sir Herman Bondi, in the introduction of a book edited by Maurice Goldsmith on science policy. Sir Herman Bondi stated:

    "So far I have discussed the two poles of applied research with a clearly defined objective on the one hand, and curiosity-oriented research on the other. There are large tracts of country in between. In particular, one can speak of strategic applied research; research that has in itself no direct application, but where one can make a good guess that its results will be needed so that future truly applied work can be successful. How this area should be financed, how it should be defined, and who should make the judgements, is perhaps even more difficult than in other fields.

    Thus, the overall context is daunting. How can we define a policy for R&D so that it is a real guideline for those who have to take decisions? How indeed should the decision-taking be organized? How should the whole thing be held together? Two or three comments come to mind at this point. First, reorganization of a country's arrangements for controlling R&D is common in every country with a frequency of perhaps once every ten or fifteen years. This in itself shows that nobody has found a really good solution, that every solution when tried at first produces some enthusiasm, then reveals its problems, and is replaced finally by something else".
There speaks a most distinguished pure scientist in the field of astronomy and particle physics and also a most distinguished public administrator of science--a good public servant--for a re-organisation once in 10 or 15 years. We are doing so once in two or three years. Surely something is very wrong with the way in which we go about business. I can say only that I thoroughly endorse everything that was said by the noble Earl, Lord Selborne.

Why do we go on with these endless reappraisals? I believe that it is due in part to the influence of lay persons who misunderstand the dubious nomenclature

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of much of scientific effort. What does "NPB" mean? Yes, it is the National Physical Laboratory, but what is that and what does it do? Is it the same as, for instance, the Bureau of Standards in the United States? Talking of standards, what about safety standards? Does that mean safety in medicine, safety on the road or safety at work? The whole conversation is immediately off the beam.

The concept of the National Physical Laboratory as involved in some kind of standard is perfectly permissible. The pound sterling has no fixed value, alas. It is one thing today and another thing tomorrow, but one cannot say that of the pound avoirdupois. It must be the same from John-o'-Groat's to Land's End and from one year's end to the next. Someone must verify it in cases where some misfeasance has taken place; for instance, someone substituting a phoney pound weight for the weight that should be in the grocer's shop.

In order that the science of standardisation can enlarge, research must be undertaken. Everything that we do in life has some kind of research backing. It is no good treating research as something totally divorced from the rest of our lives. Some things are the proper activities of government. The Government have a duty to do them. I refer, for instance, to education, to the national health and to standards. Yes, standards come into it. We need to have research into standards. The standard meter used to be two scratches on two platinum studs set in an invar bar in Paris, but all that is long ago. It is now defined in terms of a wavelength of a singlet in the spectrum of the metal cadmium. That is our standard of length. So we go from lengths to areas, to volumes, to gallons, to acres, and so on. We have to have those standards and the advance of them always means research being carried out somewhere.

As regards education, we cannot educate our children without teachers. We must then think of the several tiered structure--the teachers and the teachers of teachers at a higher level. There are the teachers of our teachers of our teachers and we are beginning to run into the universities and research problems. What is a university? It is a self-governing community of scholars dedicated to knowledge; to the preservation of knowledge in its libraries; to the dissemination of knowledge in its teaching functions; and to the expansion of knowledge in its research functions. That is why university research is a thing on its own.

I yield to no one in my admiration for the Treasury as the only body of men in the country dedicated to the proposition that Her Majesty's Government should spend less. Everyone else wants them to spend more, provided that it is on their own pet hobby, whatever it may be. But one can have too much of a good thing, and I could not quite carry that principle of spending less to the point where I would say, "It doesn't matter what you don't spend money on provided that you don't spend it". That is going a little too far. Science has been the victim of that, and the continuing chopping and changing around with ministries is partly responsible.

The Department of Scientific and Industrial Research, where I started as a member of its council, was started by Lord Haldane in World War I. It was originally a committee of the Privy Council which turned into a

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department under a Permanent Secretary. In my day that was Sir Ben Lockspeiser. It acquired an advisory council, of which I was a member. It tried to do far too much. It had 16 universities, 40 industrial research associations and 14 or 16 major government establishments and the council was overburdened with work. It used to delegate some of its work to its members and I was the member who had to report on the geological museum. That meant that I had to interview the keeper and lead the discussion in council and so forth.

I have said quite a lot. Lord Robins, speaking from where I am standing now, often said that economic decisions are concerned with the allocation of limited means to competing ends. Why the ends compete with one another has nothing to do with economics; it is a psychological matter. Psychologically, I am sold on the side of research. If I can do anything to convince your Lordships that the noble Earl, Lord Selborne, is right and that we ought not to be mucking about yet again with the structure and responsibility of ministries towards our research councils, I shall not have spoken in vain.

4.48 p.m.

Lord Quirk: My Lords, in the context of this debate, for which we are grateful to the noble Lord, Lord Walton, my few words may, I feel, seem tangential. They will, however, serve to remind your Lordships that not all the research that is essential to our national well-being has a close or obvious relationship with industry: nor does it all fall within the purview of the research councils.

The British Academy, in respect of which I declare an interest as a past president, is charged by Royal Charter to promote a certain arc of disciplines that were hived off from the Royal Society about a century ago. One segment of this arc, embracing subjects now known as the social sciences, is funded from within the research council structure by Lord Sewel's Cinderella, the ESRC, in the amount of something over £60 million a year, some of which we have all heard with pleasure today proceeds in the direction of the noble Lord, Lord Desai.

The other segment of this British Academy arc, the one usually referred to as the humanities, falls outside the research council structure and depends for research funding on a sum that is found within an annual grant to the Academy from the DfEE. This research sum at present amounts to about £16½ million pounds a year and it is distributed by the Academy's Humanities Research Board for the benefit of those fields among the Academy's chartered responsibilities not served by the ESRC.

I see nothing wrong in principle with such a division of labour in research funding provided that two conditions are met. The first is that the separate treatment of the humanities should not be thought to connote a lower estimation of humanistic research. As the frontiers of medical and natural science research increasingly impinge on ethical concerns--to give just that one example--the relevance of even the most philosophical and least experimentally oriented of the humanities becomes more insistent and obvious.

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In this connection, like the noble Lord, Lord Walton, I would draw your Lordships' attention to the report published in April this year by the National Academies' Policy Advisory Group, embracing the British Academy, the Royal Society, the Royal Academy of Engineering and the Royal Colleges of Medicine. This report on our national research capability declares unequivocally that we do not in this country adequately recognise that the natural sciences need the humanities if we are to achieve public understanding of scientific developments and their consequences.

The other condition governing the acceptability of a separate mechanism for funding humanistic research is that the humanities must not be treated as a poor relation. And here I have to say that, wholeheartedly as we sympathise with colleagues in the natural and medical sciences, we in the humanities face a particularly grave situation. The British Academy's funding of humanities research is aimed at sustaining the work of the 8,000 academics deemed to be "research active" in the humanities by those conducting the last Research Assessment exercise. Well, £16½ million works out at less than £300 a head in research support for these humanities scholars. And what is more--or rather, what is less--the £16½ million is to be reduced by 6 or 7 per cent. in real terms over the next three years. In short, it cannot be said that either of my conditions is being met.

But, finally, let me make the obvious point that world-class research, whether in science or the humanities, depends critically on world-class information resources. Yet in all fields we are feeling the grim effects of large-scale reductions in library expenditure. Acquisitions of journals and books are being seriously reduced, not only in universities but in the national library of last resource, the British Library itself. Yet it is to the British Library that industry's research workers, as well as those in academic institutions, will increasingly be looking; not--let us hope--in vain.

4.55 p.m.

Lord Peston: My Lords, in introducing admirably this debate, the noble Lord, Lord Walton of Detchant, referred to the research councils as the "Jewel in the Crown". I agree with him of course. I cannot remember whether it was the noble Lord or my noble friend Lord Winston who also said in that regard, that our friends and competitors abroad envy us that system. I must slightly disagree about that. They did envy what we had and what we did, but I am not so certain that they still do. In fact, quite the contrary, they now see us throwing it away and they think that we are raving mad, to put the matter as simply as I can.

I am not starry-eyed. I believe that research should be useful. I have worked too often for Ministers who, when it comes to policy advice, have said to me, "What is the research basis for what we need to do?" and I have had to say, "Well, Minister, even though we have poured money into this or that, on what you are asking for, we have nothing to tell you". I have the same experience now that I have the honour to sit on this Front Bench. Far too often when I am to speak in a debate, I discover

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that in exactly the area in which I need good research back-up, that is the one area in which no one seems to have done any work. Therefore, it is nice if research is useful.

I used to be an expert on investment decision-making in the public sector. I am horrified to discover that people now doing that work in places such as the DTI and the Treasury were not even born when I was doing that work. However, I somewhat blame myself for what has happened. I could do--and I still could if I were so inclined--a discounted cash-flow analysis on any project, and I mean any project, certainly within our area of discourse, and I can demonstrate that the pay-off to any item of research at the relevant rate of interest and bearing risk fully in mind is invariably negative; in other words, we should not do it.

The outcome of that is that we would do no public sector research at all. Where then would our government be in the next generation? It is not simply that we should be an intellectual backwater but, of course, we should be poorer.

When I was young, I did not have the sense to think about that at all. I would simply do the work, show it to those for whom I was working and say, "do not do it". But since then--and I am sure that it is a sign of old age--I have learnt some common sense. Therefore, in relation to economic analysis of research projects, we should be careful of what one might call the multiple reductio ad absurdum, that nothing is worth doing at all.

Therefore, I hope that research will be useful and I am second to none in looking for benefits to industry and the economy. But we must not be naive about it and we must not be naive about asking the relevant questions. I am not saying that we should not ask the questions, but it is a matter of how we look at the answers.

The noble Lord, Lord Porter, guided us through that area. We cannot guarantee at all in the case of any individual item what its impact will be on industry and the economy. We do not have that kind of information, and I hate to say it but I doubt whether we shall ever have that kind of information. Therefore, I am not saying that we should not ask the question, but the real point is how we approach our inability to answer it.

The noble Lord, Lord Porter, gave many examples. If one looks at fundamental research, who would even have engaged in the vulgarity of asking what would be the use of the work in the great Rutherford laboratory? Such a question would have been viewed with contempt by those great men of Cambridge and I believe that it should be viewed with similar contempt nowadays. In particular--and this is the point--no one could have predicted what would be the impact of that research in revolutionising that whole area of science.

A similar point applies to my favourite subject of computers. We can all think of the marvellous work done at Bletchley in connection with Enigma during the war. That was done by brilliant people, many of whom were arts-based rather than science-based. We should never make the mistake of assuming that rational, detailed work cannot be done by arts people. Moreover, when talking about the cracking of German codes,

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I should also mention Alan Turing--a man tragically driven to death in a less enlightened age. Nevertheless, the fundamental work that he carried out in computers has had an enormous impact, none of which he could have predicted or, indeed, would have wanted to predict. That is the central question. It would never have occurred to him that someone might ask him, "What use is all of it?"

In the end, the point is that one carries out the research which is unpredictable and much of it is a waste of time. Speaking for myself, it horrifies me when I look back at the large number of blind alleys that I have been down. However, I hope that I did one or two things which have been useful. Of course, I entirely agree with my noble friend Lord Desai that research work is a lottery and that, within it, there will essentially be one or two winners who will pay for the whole lot.

I have a rather peripheral point to make, but it is one that I have been pushed into making by my noble friends Lord Winston and Lord Desai. It refers to peer review, and so on. Of course I totally agree with peer review; indeed, it is the only thing that we have. However, it is very much faute de mieux. Having been chairman of the Economics Committee of the Social Science Research Council and having been the editor of an academic journal for a great many years, I know which peers to choose--and I am not talking about your Lordships--if I want an article or a project to be rejected. I hasten to add that I do not do so. I would love to believe that natural scientists are a good deal less prejudiced than economists. However, particularly within the field of econometrics of my noble friend Lord Desai, I can unerringly get an article turned down by just consulting a particular person who has a definite view on the only method that should be used in that respect. Therefore, we should not be naive about peer review, although it is the best that we have.

I return now to the practical side. As other speakers have said--and I should simply like to underline it as chairman of the Office of Health Economics and, therefore, connected with the pharmaceutical industry--we have no better example of the benefits to our country in practical terms from our greatness in fundamental work. The reason that the pharmaceutical multinationals are in our country is to make money. I am delighted with that fact; and, indeed they are immensely successful. However, they are here not for crude practical reasons but because our departments of chemistry, and so on, are simply so outstanding. If we so much as damage them, then the multinationals will go elsewhere. That is the point that we must bear in mind. Indeed, I made a similar point in the mundane area of horticulture only the other day regarding the importance of a research base for such an elementary industry. But that industry is also competing internationally and, if we do not have a proper research base, it, too, will fail.

That leads me to recognise the fact that we are in desperate competition with other nations abroad, most notably the United States. I have to say--and I hope that I will not be criticised for being unduly pessimistic--that there are too many areas in which we are no longer

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world-class players. People talk as if that may happen; but I can tell noble Lords that it has already happened in many areas. We are no longer big players in the big game. I hope that I am not being ultra nationalistic in saying that I deeply regret that fact. The reason behind that is one that the noble Earl, Lord Halsbury, and other speakers have made--namely, it is not just the Treasury, it is Ministers themselves. If you say, "Do this work and we will pay in the next generation", the likely response is, "I am sorry, I want to be paid next week". Indeed, I am as bad in that respect as anyone else. Someone has to say that the future, which is so blurred, does matter. We should have faith in how we prepare for it.

In terms of funds, I should stress that we do have our native genius. The people of this country have not gone into some kind of genetic decline. Indeed, we will still produce very many great men and women. However, in the modern areas of research--and this is also true in pure mathematics--we now need a good deal of money to carry out certain kinds of work. Moreover, in many other areas which the Americans call "big bucks", you need such money if you want to play. It is nothing to do with politics and our governments must face that fact: either you want to be a big player in the game or you might as well get out of it. There is no intermediate phase.

My time is running out but I must say a few words about universities. I am old fashioned in that respect. I cannot understand the idea of a university which is not based on research and scholarship. I cannot appreciate an academic who is not a researcher or a scholar. As academics, we may vary in our degrees of success; and, indeed, some of us run out of steam earlier than others. I should also add that some of us are better teachers, while some are not so good. But if we do not pursue scholarship in any form, we do not deserve the title of "academics" and the institutions that we work in do not deserve to be called universities.

The welfare of our country--indeed, of any country--is not measured solely by GDP per capita. I know that goods and services matter. As I said, I should like the products of our research councils to have practical value. However, there are other things that matter as well as goods and services as conventionally measured.

Like all noble Lords, I take great pride in being part of a nation of great scientists and great scholars, both in the arts and in the humanities. Having said that, I should like to take the opportunity to congratulate the noble Earl, Lord Clancarty, on his contribution to today's debate which was very much in that area. I, too, hope to hear from him further on that kind of subject. When speaking of national pride, I should say that I believe that the research and education policies of recent years have placed all of our national achievement over hundreds of years in peril. It may sound rather conservative, but I feel that we really must go back to earlier principles and earlier standards.

5.6 p.m.

The Minister of State, Department of Trade and Industry (Lord Fraser of Carmyllie): My Lords, I should like to begin by thanking the noble Lord,

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Lord Walton of Detchant, for tabling today's Motion on the research councils. This House has long had a Select Committee on Science and Technology and the noble Lord is a distinguished member of it, as indeed are other noble Lords who have spoken today. If I may say so--without, I hope, arousing the ire of another place--debates on this subject within your Lordships' House tend to be rather better informed than they are along the Corridor. Having said that, I should like immediately to add my congratulations to those already extended to the noble Earl, Lord Clancarty, on a maiden speech which was utterly distinguished in its clarity of thought and expression. I trust that the noble Earl will participate in our future debates not only on this subject but also on many others.

Along with a number of other speakers, I noticed that the noble Earl referred to Faraday who I fear is a little like Winston Churchill in that he gets invoked to support almost any proposition. Faraday was a distinguished scientist who carried out fundamental research, as well as what might be termed "contract research". Indeed, as my ministerial colleague Ian Taylor pointed out when speaking recently to the Royal Institution, it was his discovery of benzene that came out of the study of the decomposition of fish oil, related to the products of the London Portable Gas Company. Therefore, I have no doubt that there are different ways in which valuable research can be achieved.

The 1993 White Paper, to which frequent reference has been made, was a major statement on science policy; and, indeed, was probably the first for some 30 years. It stated unambiguously that science and technology would be one of the key factors determining the country's economic future and also--and, as importantly--the quality of our lives. Further, it stated that the science and engineering base (the research and postgraduate training capability of the universities and the research council institutes) underpinned the whole science and technology structure of the country.

There is no doubt that the health of that base is one of fundamental importance. Public funds are channelled into that base through two sources: first, the HE funding councils, which provide underpinning support of £900 million to the universities; and, secondly, the research councils, and some programmes administered by the Royal Society and the Royal Academy of Engineering, which provide targeted support for both postgraduate training and research amounting to about £1.3 billion. That figure was not reduced in an otherwise extremely tight PES round.

As regards the Medical Research Council, its funding has increased by some 23 per cent. in real terms over the past 10 years. I understand the concern of my noble friend Lord Peyton about alpha-rated projects. It is appropriate in this context to bring into balance the figure--which, I think I am right in saying, was some £400 million--which is provided for medical research from some great medical charities within the United Kingdom. I know that some pure research is undertaken. I highlight the work that Professor Wylie is undertaking in the Department of Pathology at Edinburgh University into the subject of apoptosis. It may lead nowhere but it is possibly some of the most

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fundamental and exciting work that has been undertaken for a long time. I shall not ask the noble Lord, Lord Desai, to suggest a figure that his party would spend, but if the figures are added up they are considerable. The money is targeted through the research councils. That targeting largely determines the direction of the science and engineering base. The councils have key roles in supporting and developing the highest quality research teams within that base; sponsoring post-graduate students at both masters and doctoral levels; and the exploitation of ideas and encouraging interaction with users.

For this reason the Government have made it clear that support for the research councils, the "science budget", was and remains a high priority. This is why on a like-for-like basis, even after correcting for the recent transfer of funds from the funding councils, it now stands some 30 per cent. above its value in 1979. Even after the transfer--which still attracts some objection--to the Department of Trade and Industry, the figure is still higher than at the time of the 1993 White Paper. As your Lordships appreciate, we now have six research councils, each with clear areas of responsibility--that is important--specific missions, and arrangements for ensuring that there is a strong user voice in their decision making processes. A further council has since been created, the Council for the Central Laboratory of the Research Councils, which provides large scale facilities and expertise.

However, the emphasis on users does not mean--contrary to some lingering suspicions within the scientific community--that the Government wish to move to more short-term publicly funded research within the science and engineering base. Indeed there has been no pressure from industry to do that. If there has been a theme running through this debate in your Lordships' House which has alarmed me, it has been that this move into the DTI has in some way been prompted by the wish of those in industry to see that that fundamental research should in some way be adjusted and the money given instead to applied research. On the contrary, it is clear that what industry wants is for the science and engineering base to concentrate on its major role of training the highest quality scientists and engineers and undertaking basic and strategic research. It does not wish that research base to be applied for applied science. It is hugely difficult to spot winners. It is emerging more and more clearly that industry is saying that if there is a process of picking winners, it considers itself to be better placed to undertake that activity. We entirely agree with that view.

Despite claims to the contrary, 90 per cent. of the research funded by the science budget is basic and strategic, and much of the remaining specific applied research is in the medical, agricultural or environmental areas. However, within this basic and strategic research envelope, the Government expect the research councils, and indeed the whole community, to have regard to the potential for future exploitation. To aid this process--I stress the word "aid" rather than direct--the Office of Science and Technology undertook an extensive Technology Foresight exercise to identify, as best it

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could, those areas of science and technology which were likely to be important over a timescale of 10 or 20 years. The findings are undoubtedly an important input, but by no means the only one, in the research councils' decision making processes.

Since the publication of the 1993 White Paper, allocations of the science budget have sought some re-orientation of the research council portfolios to accord with the priorities identified in the White Paper. The key themes being developed within this re-orientation fall within three broad areas: enhancements to basic and strategic science; enhancements to people-related programmes; and improving interaction with industry and commerce. A key feature of the allocations was that the research councils should continue to support the very best responsive mode proposals. Additional funds have been provided to enhance the key disciplines of mathematics, chemistry, physics and biology whose importance was underlined in the Technology Foresight steering group report.

As the noble Lord, Lord Winston, was speaking I could not help but observe that his noble friend Lord Desai shook his head vigorously as the noble Lord indicated his objections to the peer review process. I have no doubt that in the 14 or 15 reports to which the noble Earl, Lord Halsbury, referred, there would have been countless pages devoted to that process of seeking to determine what was the best basic or fundamental research to carry forward. Of course it is extremely difficult to attempt to pick winners, but I hope it is readily appreciated that it is no part of government to attempt to undertake that exercise. Whatever disagreements there may be within the scientific community, the matter must be left entirely to it to determine what areas of research should be undertaken.

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