Lord Heseltine speech, CaSE Annual Lecture 2012

Speech by Lord Heseltine to the Campaign for Science and Engineering, Science Museum IMAX Theatre, 27th November 2012. Sponsored by Airbus and EADS

“Industrial Strategy”

John Russell: Campaign for Science and Engineering: Annual Lecture with Lord Heseltine &emdash;

Thank you for inviting me and it is a pleasure to be here.

I am told the people showing at London’s two other IMAX cinemas tonight are James Bond and Lawrence of Arabia, so I either salute your enthusiasm for science, or console you for coming to the wrong venue.

The Science Museum is certainly very impressive.

I believe there are now 700 IMAX cinemas across the world. The first opened in Toronto in 1971. That was a year after I first took up ministerial office.

I was recently asked whether the world had changed beyond recognition in that time. I suppose it has but my answer to the question was simple – human nature hasn’t.

Our inherent inquisitiveness, our desire to understand the world around us and to make it better have underpinned human behaviour for centuries, probably millennia.

History is rich with examples which will be very familiar to you:

  •  Da Vinci’s first designs for a vertical flying machine
  •  Paracelsus and his pioneering use of medicines
  •  Sir Tim Berners-Lee and the world wide web

Each in its own way had a profound and ever lasting impact on our society of the time and societies for many centuries to come.

But the story behind IMAX is actually a case in point.

Its development has been a relentless pursuit over many decades to improve the picture quality of recorded film. It has involved a step-by-step improvement – a desire to pain stakingly observe the latest version, spot its imperfections and strive to be just that little bit better.

Like so many advances in technology it has been done for the greater good. A handful of scientists toiling away so that the cinematic experience of the masses could be lifted to new levels.

In many ways scientists and engineers are the forgotten heroes of history.

Politicians –some of them anyway – are remembered for their great speeches, preserved forevermore in our libraries.

The works of our great writers, our painters and our musicians adorn the bookcases, walls and CD collections of every home.

The achievements of our sports people are written in the record books for eternity.

Much of your work is overlooked, even taken for granted. When asked to name the great modern inventions people would say “the iPad”, “Dyson” or “Blackberry”. But few think of the technology that makes them work and the components of which they are made up.

It is only through people like you, working hard to ensure that microchip run that little bit faster, the touch screen to be just that 1% more responsive or the battery to be smaller than ever before, that these great inventions can work, and be constantly improved.

And what is particularly pertinent about IMAX is that it brings science and engineering into the lives of young people.

Whilst the majority of people watching Skyfall in Swiss Cottage tonight will do so frankly out of their love of 007, there will no doubt be some who are there just for the experience of the remarkable technology. And if just one of them is a teenager who goes to school tomorrow with a renewed enthusiasm for their science lessons, then the pioneers of IMAX technology would surely have done a worthwhile job.

In preparing for tonight I looked back over my speeches across my time in ministerial office in the 1970s, 80s and 90s.

I stumbled across an address I made on 23 November 1989 not too far away from here in Regent’s Park. It was entitled “Paying for Science”. No doubt some of you were there that night as it was the CaSE lecture – or Save British Science as you were then known.

Reading it back made me realise the issues have not really changed. I covered much of the same themes that I intend to cover tonight:

  • Increased participation in the STEM fields in theUK;
  •  Investing in research and development;
  • and the role of Government and industrial strategy.

Now let it not be said that I am saying we have not made progress or that governments have not acted in that time. Quite the opposite.

We now have four of the top six universities in the world.

Our research base is the envy of much of the world and it performs at a disproportionately high level given our relatively small population.

What it goes to show is that no matter how much we advance in the UK – as we have undoubtedly have – scientific discovery never stands still. As I said earlier, human nature: to watch the world around us, explain it and then seek to improve on it will always mean we can not rest on our laurels.

And what is different now in 2012 to 1989 is the global economy in which we operate.

I made that speech to you 23 years ago just a fortnight after the Berlin Wall came down.

Economic collaboration in the Eurozone in the 1990s was driven by the political harmony across Europe that that event caused.

More recently the emergence of the BRICS –Brazil,Russia,India,China and South Africa– as the booming economies of the world has switched our focus outside of Europe.

Interestingly their rise to prominence has been much less driven by political factors, but much more so by scientific factors – as doing business further afield has become cheaper and faster than ever. Developments in computer technology and in transportation mean I can buy something on the other side of the world today and it will be with me by the end of the week.

All without leaving the comfort of my armchair.

And so as the power of technology opens new doors and turns the world into one market place, our need to stay on top of our game becomes more and more vital as ever more people compete for our share of the global cake.

It was that central idea that ran through my recent report to government to which you have referred No Stone Unturned in Pursuit of Growth. How do we keep up?

Our reaction as a country to the emergence of a truly global economy, with sharks circling us in every water: we’ve got a choice – it can either be to turn round and swim for shore or to fight them for every fish in the sea.

In that sense the pursuit of economic growth is not too different from the pursuit of scientific innovation – we need to watch what is happening in the world, see how others do things, learn from them and then determine to do it even better ourselves.

If I may, I want to cover some of the specifics of my report that I hope will be of particular interest to you.

Education and Skills

I know and I think you all know that UK industry laments the lack of availability of skills in certain professions.

The Royal Academy of Engineering estimates that there will be a requirement for more than 100,000 STEM graduates per year between 2012 and 2020 and that this will not be met be newly graduating STEM students.

This is not news to you. I am aware that this is one of the areas where CaSE has raised concerns with government for many years and I understand that EngineeringUK’s next annual report will cover the theme in detail.

Of course, the short term solution is to bring in more skilled workers from overseas and in my report I call on the government to go further in its immigration policies to facilitate that.

But there is a note for all of us.

The annual quota for skilled immigration is currently under-subscribed by 30%, and the route by which the most gifted individuals in the fields of science and the arts can come to work in the UK has not been well utilised.

I believe that many of you of course may see that as someone else’s problem – and some times it is – but I would reply to the often heard grumbles of “the system is too complicated” and “the government should make the rules clearer” by calling on everybody to do more to raise awareness in your own businesses or own scientific fields of the benefits and availability of skilled immigration and the fact there is significant headroom in the ceilings that exist.

There is no doubt, however, that some skills shortages are chronic and long term. Time and again in the course of my review I heard about the lack of suitably trained engineers in the UK and the problems in recruiting from abroad.

In Edinburgh I listened at a roundtable as engineering boss after engineering boss gave me the figures that they could recruit there and then if the supply existed. The numbers were mind blowing – 150 in one company, 60 in another, 450 in another.

Since then I met someone from the North East who had turned down a large export order due to a lack of available staff.

Meeting that demand ought not to be a problem – the associated salaries those bosses were willing to offer would tempt any graduate. Yet the fact is not enough of our children our interested in the STEM subjects. I have reason to believe we should be optimistic – science has never been so accessible or exciting.

Early signs are encouraging, with the take up of science, technology, engineering and maths subjects at GCSE and A Level, rising steadily. And I know CaSE has long called for an increase in the uptake of GCSE triple science in particular and you would be well advised to continue to promote that cause.

In addition manufacturing and engineering apprenticeship starts were up 30% in 2010-11.

But none of this can give us grounds for complacency.

It has been a preoccupation of my whole political career that our education system lags behind our major rivals. It is nothing short of a national scandal that 571 of our schools are currently graded by OFSTED as inadequate. Is it any wonder that 1 in 6 adults are functionally illiterate and 1 in 4 functionally innumerate when we tolerate the existence of so many schools that are inadequate.

This isn’t a party political point. It has been true for over a century.

There are continuing anxieties. OECD global rankings for performance amongst 15 year olds in reading, maths and science show us going backwards in the least ten years.

My report calls on the government to place educational improvement, the raising of basic standards and the complete intolerance of sink schools right at the heart of the growth agenda in this country.

Just think of the denial of opportunity.

You can’t work in a care home if you can’t read the instructions on the pill box.

You can’t be a gardener if you don’t understand the labels warning of poisons.

We all want to find the scientists of tomorrow. The mathematical geniuses of the future. The cohort of youngsters who will one day take over the baton from all of us and produce the innovations so brilliant that today they are almost unimaginable.

So go find them.

Get into the schools.

Talk to our youngsters. Educate them. INSPIRE THEM!

There are now over 25,000 scientists, engineers and technologists that are doing just that through the BIS-funded STEM Ambassadors programme.  But there could be so many more.

Every child remembers the brilliant adult who sparked a flame of ambition in their head, who changed the course of their life forever. So you too could perhaps be an ambassador helping children to pursue careers in these fields.

Research and development

R&D plays a vital role in helping us understand the complexities of the world we live in.

There is no better example in the whole world of the work of scientists to untangle those complexities than at the Large Hadron Collider. Scientists from across the globe are slowly but surely unravelling the world we live in to answer some of the great unsolved puzzles of the universe.

Just this month discoveries were made that bring in to question the long held belief in super symmetry and scientists and non-scientists alike wait keenly to see whether July’s discovery was indeed the Higgs Boson particle.

These findings are astonishing. No words that I can deliver could ever do justice to the sheer incomparability of the human achievements that have led to them.

And, as all of you will know, this country has been a major partner in CERN.

We have some of the most prominent scientists in the world. Take Sir John Gurdon and his remarkable stem cell work that earnt him a Nobel Prize this year.

Much of my report was about the pursuit of excellence, but actually in many ways in scientific research we are already alongside the best in the world. So what matters most is we stay there.

So I welcome the government’s ringfence for the science and research budget, protecting it in cash terms at £4.6bn and in my report I urge the government to continue its admirable commitment so that our investment stays at a level where we can keep up our excellent world standing.

One of my other recommendations concerned Research Councils UK.

Before I say more can I take a moment to pay tribute to RCUK.

These councils play a key role in UK society and are widely respected by the public as authoritative sources of world leading and cutting edge development.

My political career has focussed on the benefits of collaboration and partnership working – bringing people together round a table to pursue a shared vision.

It surprised me to learn that the partnership between the seven research councils has only existed since 2002, but I certainly wholly commend it. I had the pleasure of meeting RCUK’s members, including Professor Rick Rylance, in the course of my review and was refreshed by the way they lifted the dialogue on investing in our research base above short term easy wins and into a longer term vision. I read with interest their recent report on the UK’s research capital base which, again, provided the necessary long term strategic vision we need in order to maintain our world standing. I certainly agree with the Chancellor’s warm comments in his response to it.

Going back to that recommendation – I am keen that the government continues its relationship with RCUK. In my report I advocate a greater focus from all government departments on growth.

This is an interesting concept.

In short – growth is everyone’s business. It can’t be led from the Business Department or Treasury alone.

To that end, I have urged the government to ensure that all departments develop a strategic dialogue with RCUK as they develop the growth commitments that I also advocate because I believe each government department should pursue a growth agenda.

The final thing I wish to say on research – which I also cover in my report – is that we must not do it for its own sake. Yes, it serves an important purpose on its own. Indeed I spoke in that speech in 1989 of the value of increasing knowledge and understanding to meet our minds’ curiosity.

But it must also play its role in the pursuit of growth. Just as we use our historic castles, our cutting edge film studios and our unbeatable sporting venues, to attract money from abroad, we must also do all we can to market our world renowned research base to attract inward investment.

So there is my challenge to you – don’t just see your laboratories as the places where incredible discoveries are made – think of them as a national asset that we need to market to companies across the world.

Standards and innovation

Much of my report challenges the inherent risk aversion of our society. The Prime Minister talked a lot about it at the CBI in his speech last week.

He referred to the tick box culture. The form filling. The gold plating of regulations.

The great inventors of all time only achieved what they did because they went for it. Testing new ideas. Seeing what happened.

For all of Da Vinci’s great ideas, it’s extraordinary to say this – the helicopter, the tank, solar power – doubtless he had a hundred bad ones.

You have to be prepared to fail if you are going to succeed.

Mistakes are a natural consequence of human endeavour. Indeed some of our most famous inventions – like the microwave, fireworks and penicillin – were discovered partly by accident.

Franklin D Roosevelt’s famous phrase “you have nothing to fear but fear itself” has a great deal of truth.

We see this risk aversion in the setting of standards in the UK.

Standards can bring fresh ideas to the market faster. They can help us gain competitive advantage. Yet too often we are slow to react and slow to engage, and when we do think about them we are often over cautious.

I often say that we set our standards by the slowest ships in our convoy, whereas countries like Germany do so by the standards of the fastest in the fleet.

To give credit where it is due, the British Standards Institution is doing a good job engaging with the business community. I discussed the issue with its head, Scott Steedman, in the course of the review and support what he is trying to achieve at the BSI.

But once again my call to you is to help him, to collaborate. Standards can only be developed to maximum effect if our innovators work with the BSI to create them at the earliest opportunity for a developing technology.

Surely we all ought to be able to agree that there is little point in the thousands of hours you all put in to developing new ideas, new gadgets, new creations if our rivals get them to market much quicker, and reap the rewards and the credit?

So we need to reach out to the BSI and work with them to get us ahead of the game.

Industrial strategy

Can I conclude by saying something about industrial strategy.

It’s a highly controversial set of words.

I know it’s not everyone’s favourite phrase. Some of my own political friends refuse even to say the words. You know the words that are associated with it:

“picking winners”

“you’re being interventionalist”

“creating new bureaucracies”

“been tried before”

“failed then”

“will fail again”

I wanted to use tonight’s speech as an opportunity to meet those criticisms head on, and also to praise Vince Cable for the excellent work he has started in the Business Department.

Industrial strategy is quite a simple concept.

It is about government working hand-in-hand with business to help our industrial base get ahead.

About talking to key sectors to help them to grow.

It is underpinned by a constant dialogue between the state and the private sector so that each can understand the needs and the concerns of others. It also involves a more strategic approach to procurement – not just thinking about value for money or quick off-the-shelf solutions, but thinking more long term and investing in the UK’s industrial base.

Frankly it’s not rocket science.

It is how all other advanced economies organise themselves.

Some say it is “picking winners”. But that is what all our rivals do. What do people expect governments to do – pick losers? With the billions of money they are constantly spending government is picking winners now.

Look at the Olympics Games. The most extraordinary national event in my lifetime. In all likelihood none of us in this room will ever see such an occasion again.

We won 29 golds in the Olympics and 34 in the Paralympics.

This did not happen by chance. Our athletes did not turn up inStratfordin July and have a go. For eight long years every one of them pushed themselves to the limits of human tolerance in order that on their one day in the sunshine in the summer of 2012 they would prove to billions of onlooking eyes that they were better at what they did than any other human being that had ever lived.

Did we pick winners then? Of course we did.

And did each and every one of them and us love every second of that summer? Of course we did.

John Major started it long before with his investment in sport from the National Lottery.

So why not adopt the same approach with our industrial base? Why not test day-in day-out, year-on-year, what it takes for each and every one of our companies to be the best in the world and to support them in their endeavours to be just that. And let’s shout from the rafters when we achieve the economic equivalent of gold – the multi-billion pound contract in the UK from the Far East, the scientific discovery that secures a British scientist’s place in history forevermore, the world leading innovation that improves daily life immeasurably.

Of course, CaSE has much to say on this issue. Together with Nesta, you recently released a report, entitled ‘4Growth’, which argues that the multi-billion pound proceeds from the forthcoming 4G spectrum auction ought to be reinvested in science and engineering – partly because those proceeds are a return on previous investment and activity in the fields of science, engineering, entrepreneurship, and innovation, and partly because these are the areas the UK must specialise if it is to be growing and competitive on the global stage.

Those of you who saw Vince Cable speak to the CBI last week will have heard him touch on the report’s recommendations.

It’s absolutely true without investment in people like Marconi and Berners-Lee we wouldn’t have the technologies we take for granted today. Their efforts in creating wireless infrastructure and the world wide web, although made almost a century apart, are both critical parts of our modern economy and speak to the importance of promoting science and engineering.

CaSE and Nesta’s report is an important and illuminating contribution to the debate on industrial strategy.

And it’s not just you talking about it. Not just the scientists. The TUC have called for an industrial strategy, as has the Times newspaper and the CBI self-evidently believe in it. An odd coalition perhaps. I find a consensus forming.

We are no longer talking about whether we should have an industrial strategy or not, but instead what it should look like.

That was confirmed by the Prime Minister just the other day.

And I am hugely encouraged by the government’s words on this. Vince set his stall out in September and I understand the first wave of sector strategies are coming out shortly. It’s a big step in the right direction.

And the Prime Minister last week reinforced the message. He said we are in “the economic equivalent of war today” and he is right.

I lived through that war. No one who did would say it lightly.

We didn’t win that war by getting our heads down and hoping for the best. We won it by each and every one of us straining every nerve and sinew to beat the enemy. And so it must be that we each identify the role we can play in pursuit of growth.

Conclusion

The Government will reply to my report next week. We shall see what they say.

But do not let that be the beginning and the end of the debate.

Every one of us has a role to play in making this country a better place to live. I do not need to tell you that – by definition you are exemplars of excellence. But I hope that you won’t go away from tonight content you are doing all you can and thinking that my speech was aimed at someone else.

Where we are not good – let’s become good.

We are all in it together.

And where we are already excellent – remember are competitors are close behind.

We can all identify what we need to do.

If you want a better dialogue with government departments get in there and see them.

If you don’t think the colleges of further education are producing the skilled students you are crying out for then tell them and work with them to do something about it.

If you think the public debate on immigration has become too simplified about illegals and queue jumpers then get on the airwaves and start talking about skilled immigrants.

Gone are the days of waiting for a green light from Whitehall before anything happens. The economic crisis dictates more urgency. It demands for each and every one of us stands up and be counted.

If there is one benefit for the worst economic crisis of modern times it is that there is a new audience.

The world will not stand still and neither must we.

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One Comment

  1. Posted 29/11/2012 at 10:00 | Permalink

    fascinating and frightening lecture by Lord Heseltine yesterday. Eager to see what the government make of the 89 recomendations… Disagreed with one point though, i think employers can do more, its not the sole responsibility of the education system to deliver Engineers and Scientists. Employers need to make themselves more attractive to the ‘Facebook’ generation…
    Geoffrey Smith
    MD Experis UK
    Resourcing, Consulting and Solutions
    for IT, Finance and Engineering

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