Department for Innovation, Universities and Skills
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Innovation vital for UK to emerge stronger from economic downturn

Innovation vital for UK to emerge stronger from economic downturn

DEPARTMENT FOR INNOVATION, UNIVERSITIES AND SKILLS News Release (Press release 083/2008) issued by COI News Distribution Service. 4 December 2008

First annual innovation report to hold Government to account on pledge to make Britain best place in the world to run an innovative business

The world's first national progress report on innovation was published today by the UK Government as Ministers underlined the vital role innovation has to play in securing the country's long term prosperity.

The Annual Innovation Report outlines progress made on innovation to help transform public services and ensure UK businesses benefit from the £175billion spent annually through Government procurement.

Launched today at a Downing Street reception attended by the Prime Minister, Innovation, Universities and Skills Secretary, John Denham, and Science and Innovation Minister, Lord Drayson, it draws together information and data against which the UK's future progress will be judged.

The Report also announces the Government's progress on delivering the commitments first outlined in the Sainsbury Review and taken forward in the Innovation Nation White Paper.

Key achievements include:

* The announcement today of a £5m Innovation Research Centre, which will conduct research to assist Government and businesses meet current challenges including the economic downturn and climate change;

* A commitment from every Government Department to use their procurement budget to encourage innovation in business. Today guidance has been published to prepare these departmental Innovation Procurement Plans (IPP);

* A new pilot programme to ensure UK businesses benefit from the specialist expertise of further education colleges to make business more innovative and enable them to move into new markets.

Key statistics outlined in the report show signs of improvement in the UK's innovation performance but that there is more to do. These include:

* The proportion of innovative businesses has increased from 49% in 2001 to 68% in 2007;

* Spending by business and Government on R&D increased by 4% in real terms to £23.2billion in 2006;

* The number of degree level qualifiers has increased by 36,220 and doctorate qualifiers by 2,632 between 2003 and 2007.

Lord Drayson said:

"Publication of this First Annual Innovation Report delivers on a recommendation first set out by Lord Sainsbury in his 2007 review, 'Race to the Top'. It underlines our commitment to put innovation at the heart of our strategy, and to ensure the spread of good practice across government departments and Regional Development Agencies. "It presents a picture of a nation that is both good at innovation and getting better at it. However we need to maintain this progress to cope with the economic downturn and to emerge stronger from it. "We must continue to invest in talent, science and innovation. Our future depends on it."

Notes to Editors

1. The Innovation Research Centre is announced today. The centre will be funded by DIUS, the Economic and Social Research Council (ESRC), the National Endowment for Science, Technology and the Arts (NESTA) and the Technology Strategy Board (TSB). The funding partners will contribute a total of £5m over five years. The centre is expected to commence work in January 2009. For more details see

2. Pilot competitions for the reformed Small Business Research Initiative (SBRI) have been launched by Ministry of Defence aiming to reduce the dependence of the military on fossil fuel based energy sources (August) and by the Department of Health on reducing health care infections (October).

3. DIUS announced five pilots to build direct links between businesses and experts, facilities and resources in colleges and the wider FE sector on 1 December 2008. For more details, see

4. DIUS has launched a competition to promote the use of the Forward Commitment Procurement (FCP) model across the public sector. This will support public sector organisations to use FCP to encourage the development of innovative solutions that will improve sustainability.

5. The Annual Innovation Report can be found at

6. The following is a list of documents being published alongside the Annual Innovation Review:

* Guidance to Departments on producing Innovation Procurement Plans

* DIUS' Innovation Procurement Plan

* A checklist to help regulators promote innovation

* 2008 Annual Report on the Government's Ten Year Science and Innovation Investment Framework

* Economic Impacts of Science and Innovation 2008 - detailed economic and statistical data on UK innovation science and innovation performance

* A report on the UK Innovation Survey 2007 (The survey is the largest and most comprehensive survey of UK business innovation activities with data from over 16,000 enterprises)

* John Denham's letter to the Prime Minister - outlining the progress made since Lord Sainsbury's 2007 review

7. For further information about the Annual Innovation Report, contact the DIUS press office on 0203 300 8105.


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