Recommendation 14

HM Government · verbatim extract Not Addressed

The government partially agrees with the recommendation. We agree on the value of transparency around the geographic and sectoral distribution of R&D investment that the Committee rightly underscores. UKRI already publishes backward looking spend data by region, and has published priority sectors and Research Council allocations for the Spending Review period 2026/27 – 2029/30 in line with the Committee’s recommendation. These funding awards are also captured at cluster level in the Innovation Clusters Map. DSIT’s Innovation Clusters Map provides the most comprehensive national assessment of UK innovation clusters, bringing together various elements of the data the Committee has highlighted. This year’s mapping includes R&D tax credits qualifying expenditure to help start integrating wider private sector spend data. There is always a relationship between data collection and the administrative burden grant applicants experience in the R&D ecosystem, so we will continue to ensure any new data collection processes strike a sensible balance between providing valuable new insights and these burdens. On the wider R&D budget, both DSIT and UKRI have published details of their planned R&D spend across the Spending Review period (2026/27–2029/30).1 DSIT also publishes detail of its R&D spending through the Departmental Estimates process to help outline investments across a range of priorities. However it is important to note that much of DSIT’s Partner Organisation and UKRI funding is competitively awarded based on excellence, meaning information on the exact sector and region of potential grant awards can only be reported retrospectively. Where R&D funding is explicitly allocated to regions, these are publicised by UKRI. For example, details of the regions selected for earmarked funding under the Local Innovation Partnerships Fund.2 The ONS publishes Business Enterprise Research and Development (BERD) data, including regional breakdowns, which provides us with a robust source of information on private sector R&D investment. We also agree with the Committee on the importance of private sector leverage insights and DSIT previously commissioned the OECD to examine how public R&D investment leverages private investment at a regional level, generating new evidence on “leverage rates”. Building on this, we will track private sector leverage and match funding through monitoring and evaluation for place- based programmes, including Innovation Accelerators and the Local Innovation Partnerships Fund, recognising that these effects take time to materialise. Projects will report on core metrics quarterly, including tracking of external co-investment in clusters, focusing on their effectiveness and the success 1 https://www.gov.uk/government/publications/dsit-research-and-development-plans- to-2029-to-2030/dsit-research-and-development-rd-plans-to-20292030, and https:// www.ukri.org/publications/explainer-ukri-budget-allocations/budget-allocations-for-uk- research-and-innovation/. 2 https://www.ukri.org/what-we-do/browse-our-areas-of-investment-and-support/local- innovation-partnerships-fund/ of the programme in supporting innovation–led local growth. These evaluations will also capture wider impacts including job creation, company formations and intellectual property filings.