When we finally get back to some kind of normality following the Covid-19 crisis, it will be vital to find dynamic new solutions to help increase economic prosperity and productivity through innovative products and services. Many businesses recognise the need to innovate to thrive in the post-Covid world, giving them the resilience to grow the workforce and even expand into new markets.
During this year, Coronavirus, and the Government’s necessary public health measures to deal with it, have seriously weakened the economy, reducing production and consumer spending.
The pandemic has also caused a reduction in global economic activity which has had a knock-on effect for UK industry, disrupting international supply chains and reducing demand for exported goods. This year alone, the Office for Budget Responsibility (OBR) believes we will have the largest annual reduction in GDP for 300 years.
The long-term effects on the British economy of the Coronavirus pandemic will not be known for some time, but the OBR has assessed that the impact of Covid-19, not just on people’s jobs and livelihoods, but also on mental and physical wellbeing, would have been much worse without the levels of support for individuals and businesses the Government has put in place.
The Office for Budget Responsibility is projecting an unprecedented level of Government borrowing of just short of £400 billion for 2020/21 and Chancellor Rishi Sunak in his Financial Statement on 25th November 2020, told us that not only was our health emergency not over, but our economic emergency had only just started.
There are undoubtedly major challenges for the economy in the years ahead, but going forward, the Government believes we have a unique opportunity to build on the success of the UK’s contribution to world-leading research and development, which will help to boost economic growth.
Financial support for R&D activity
In his March 2020 budget, the Chancellor promised to increase funding significantly for Government research and development over the next four years as part of its strategy to encourage private and public investment in the research environment, working towards a total investment in R&D of 0.8% of GDP by 2024/25. This unprecedented commitment to R&D represents an increase in public investment of £22billion per year by 2024/25.
This was followed in July by the Government’s visionary UK Research and Development Roadmap, setting out long-term objectives to invest in science and research. Research and development will help to build the foundations of new industries, boosting economic growth for decades into the future, and reaffirming the UK as a science and technology ‘superpower’.
Science and Technology lead the way
Companies involved in medical technology and pharmaceutical research have found themselves at the forefront of Covid-related research in the race to find a vaccine as well as developing personal protection products.
At the same time, R&D work has suffered from profound disruption with researchers having to adjust to working remotely.
Earlier this year, the Department for Business, Energy and Industrial Strategy commissioned a report into the impact of Covid-19 on the activities of research groups. Over 10,000 researchers took part, working in a range of settings including companies, research institutes, charities and UK universities. The report was published in October, and key findings included :
- The biggest challenge was a lack of access to laboratories and archives, with an almost 100% decrease in research activities that could not be done at home, such as lab experiments or fieldwork. Unsuitable home working conditions were also a problem, with a lack of office and IT equipment and software. Caring responsibilities also interfered with research activity at home.
- There had been a decrease in business and academic networking and collaboration. This would include clinical work, knowledge exchange activities, and training and professional development.
- Researchers in all settings had had their research delayed and had lost important data.
- All researchers, particularly early-career workers, were anxious about future funding and jobs.
Notwithstanding the constraints on R&D work resulting from Covid-19, the vaccine produced by outstanding British scientists at Oxford University working with Astra/Zeneca has made a major contribution to the containment of the disease, with the hope that key workers and vulnerable groups may be able to be vaccinated within weeks.
The Government believes that research and development will help drive an economic and social recovery from the impact of the Coronavirus in the UK and give us a leading technological edge.
The financial support over the next five years underlines a commitment to strengthen research and innovation to make the UK economy healthier and more resilient. The aim is to boost research in science and technology to maximise the benefit of British-led innovations to improve our quality of life. This would include the creation of new industry sectors and job opportunities, and finding environmentally-friendly solutions to the impact of climate change, including the achievement of net-zero carbon emissions.