Select Committee on Science and Technology Fifth Report


1.  Concluding the first-hand observation of how RDAs interacted with their regional partners, on 20 March 2003 members of the Sub-Committee visited ONE, the Regional Development Agency for the North East of England (Durham, Northumberland, Teesside and Tyne & Wear) and the North East Science and Industry Council[82].

2.  The visiting party comprised Lord Patel (Chairman), Lord Freeman, Lord Methuen, Lord Oxburgh and Lord Thomas of Macclesfield. They were supported by the Clerk (Mr Roger Morgan) and Assistant Clerk (Mr Gordon Baker).

3.  The party was welcomed to ONE's suite at Newcastle Upon Tyne's International Centre for Life by senior representatives of the Agency and the Science and Industry Council. Before a series of formal presentations, members had informal discussions over a buffet lunch with people from a wide cross-section of regional business and HE interests.

Introductory briefing

4.  Mr Chris Pywell, Head of ONE's Strategy for Success Team, set the scene by noting that, despite over 70 years of Government intervention, the North East's economy was still under-performing in comparison with the rest of the UK. It had less high added-value employment and lower productivity than most UK regions. New business start-ups had been below the national average.

5.  The North East's regional policy was based on mobilising regional potential, locally-driven through the RDA, building on existing strengths and concentrating on developing globally-competitive innovation and entrepreneurship. The strength of the regional SET base was critical to this approach.

6.  The North East was starting to turn the corner. A recent independent study had shown that the region had the highest percentage of large enterprises involved in innovation and was second only to the West Midlands for innovation by all enterprises. 36% of North Eastern businesses regarded science as important (compared with a national average of 28%) and the North East was second only to London in new technology start-ups.

Regional strategies

7.  Mr Neil Mundy, Director of Integration at ONE, outlined the Agency's regional strategies, during which he made the following main points.

a.  ONE's Regional Economic Strategy recognised the importance of bringing the region's HEIs together with business to create a new entrepreneurial culture, raise productivity and improve the skills base.

b.  This in turn had spawned a strategy for building a knowledge economy in the North East, the Strategy for Success. Consultants had helped to identify key regional strengths measured against international business trends and best practice. Science and technology were seen as the main drivers for future economic growth, hence the early establishment of the North East Science and Industry Council (see paragraph 8 below). However, attention had also to be paid to the role of parallel infrastructure developments (such as the transformation of Newcastle's Quayside) to help support SET-based growth.

c.  The cluster concept inherent to this strategy had to be firmly rooted but dynamic. It was as important to encourage more innovation among existing businesses as it was to stimulate new innovative business ventures. In any case, it was essential to avoid the lower technology investments which had characterised much of past assisted regional development.

d.  ONE had also set up three new regional investment funds and a new facilitating company, NorthSTAR, to offer business development services, especially to help maximize IP, and overcome financing gaps. A partnership programme with Cambridge-MIT would stimulate new research links.

e.  A coherent approach was being developed with the Research Councils, HEFCE and the FRESA. The principles of Foresight should inform the strategy, but needed to be adapted to meet local needs and aspirations.

f.  ONE's role was to act as a catalyst, translating the strategy into action by providing leadership, strategic analysis, practical advice, access to funds and fruitful contacts, and to promote and lobby for the region in the UK and abroad. In doing so, it explored possibilities for mutually beneficial collaboration with other RDAs through networking at various levels which also helped avoid needless competition and duplication.

g.  The Agency's strengths lay in the local knowledge, contacts and commitment of a Board and staff with solid business experience and independence from Government.

North East Science & Industry Council

8.  Mr Pywell spoke about the North East Science & Industry Council, making the main points as below.

a.  The Science and Industry Council had been set up at an early stage to provide independent guidance in developing the strategy. Its title explicitly recognised ONE's and the Region's need for expert industrial as well as scientific advice. That balance was also reflected in its distinguished membership.

b.  The Council had brought together a wide range of expertise from people committed to the region, and had played a crucial part in developing the regional strategy. By common consent, it had a central role in helping to steer the region's regeneration.

c.  To help provide a focus for future developments, centres of excellence were being established in particular fields where the region had world-class potential, namely: new and renewable energy; life sciences; nanotechnology, photonics and microsystems; digital and media technology; and process industries. By creating critical mass in these key areas, the centres of excellence would build on the existing industry clusters and university research, help pull in additional investment, and generally fast-track the most advantageous developments.

d.  The centres were new models of public/private development — companies limited by guarantee, with their own independent boards and freedom to pursue their objective of sustainability. Five Chief Executives, of international standing, had been recruited to run the companies.

e.  The Council would provide overall long-term vision as well as key sectoral expertise. This would help to keep ONE abreast of significant scientific, industrial and policy developments and ensure that the assumptions on which the strategy was founded remained valid. It would also monitor the implementation of the strategy, act as a champion in promoting it, and use members' contacts and influence to foster creative partnerships and support networks.

Regional Universities

9.  Professor John Goddard, the Deputy Vice-Chancellor and Professor of Regional Studies of the University of Newcastle, gave a presentation on the Universities' perspective. Among his main points were the following.

a.  Universities wanted to be located in a vibrant forward-looking region, not least to help them attract talented staff and students and expand their own research base.

b.  They were significant contributors to the regional economy and increasingly aware of their local civic and social responsibilities, including the needs of the local labour market and demands for life-long learning and access to high-quality local academic institutions.

c.  Too much publicly-funded research was concentrated in the South of England. The proposals in the recent HE White Paper could have the perverse effect of exacerbating this geographical imbalance and hampering the growth of Third Leg activities. North East universities were countering this by working, with ONE's support, to build critical mass through intra- and inter-institutional collaboration.

d.  It was important to avoid wasteful "turf wars" between universities, as it was between regions. ONE and the Science and Industry Council had helped to bring HE and business together in a coherent regional strategy. This, and other RDAs' efforts, should feed into a joined-up national SET policy involving Whitehall Departments, the Research Councils and HEFCE.

The International Centre For Life

10.  The above events were, as noted, held at the International Centre For Life. The Centre's Chief Executive, Alastair Balls, explained that it had brought together a probably unique mix of science and biotechnology, research and education, entertainment and ethics, all on a single site. Built at a cost of some £70m (raised from the Millennium Commission, the EU and the private sector) and opened in 2000, it had developed into a flagship UK location for exploring genetic science and was a vital part of the underpinning for ONE's centre of excellence in life sciences.

11.  One of the site's recent arrivals was Xcellsyz, a company using cell-based technologies for drug discovery. Xcellsyz had been spun out of a collaboration between the University of Newcastle, the University of Barcelona and University College, London. Mr Brad Hoy, the CEO, outlined the benefits of ONE's support and co-location with other research activities on the site. Dr Rez Halse, Xcellsyz's Head of Cell Biology, showed members round the company's state of the art facilities.

12.  Members also visited the Centre's public exhibition, where they were shown round by Ms Linda Conlon, the Director. Joined by Mr Noel Jackson, the Centre's Education Manager, they also toured the associated school science education facilities.


13.  The day ended with a dinner kindly hosted by ONE and the Science and Industry Council. This enabled the visiting party to continue informal discussions with leading figures from the host bodies and the region's business and academic communities.

14.  Members endorsed the Chairman's thanks to ONE, the North East Science and Industry Council and the participants in the various sessions for an informative day which would be of great assistance to the work of the Inquiry.

82   Members stayed in Newcastle the following day, 21 March, for a public meeting at which oral evidence was heard from, among others, ONE and the North East Science and Industry Council (see pages 191 and 152 of Volume II). Both bodies had also submitted written evidence to the Inquiry (see pages 167 and 139 of Volume II).  Back

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