In her speech to the Confederation of British Industry (CBI) Annual Conference yesterday, the UK Prime Minister Theresa May announced a “modern Industrial Strategy” aimed at boosting research and innovation in post-Brexit Britain.

According to her speech, the strategy will comprise three key elements:

  • An additional £2 billion annual government investment in research and development, to be introduced by the end of this Parliament (2020)
  • A new Industrial Strategy Challenge Fund to support priority technologies, such as biotech, robotics and advanced materials manufacturing, to be set up and overseen by UK Research and Innovation (UKRI), a public body formed in 2016 from the seven Research Councils, Innovate UK and Research England – the UK Government will consult on how the fund can best support businesses to ensure that ideas developed in the UK are commercialised in the UK, but not elsewhere, as has often been the case
  • A review of research and development (R&D) tax incentives, aimed at ensuring that the UK continues to actively encourage research and innovation – since 2010, R&D tax credits have been increased from £1 billion to almost £2.5 billion a year, but the Treasury will look to see whether more can be done to stimulate investment in the UK

Mrs May suggested that the Industrial Strategy will be ambitious for business and for Britain, and that it is about government “stepping up, not stepping back” and making the most of the historic opportunity that lies ahead.

Carolyn Fairbairn, the CBI Director-General, responded to the speech by describing the PM’s vision as ambitious and inclusive, placing the UK front and centre of the world stage for innovation. She also suggested that a first priority for the new investment should be Innovate UK, which stimulates business innovation by running funding competitions for UK based companies who are engaged in developing innovative products or services. £25 million was recently awarded by Innovate UK to over 60 projects designed to boost UK manufacturing. Ms Fairbairn went on to say that Innovate UK has an excellent track record in stimulating innovation but that it was underfunded, compared to similar organisations outside the UK.

The CBI has listed doubling the funding for Innovate UK as one of its priorities for the Chancellor’s Autumn Statement 2016, due on 23 November.

This will all be welcome news for innovative companies in the UK, and we look forward to seeing further details regarding the Challenge Fund consultation in due course.