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IoT R&D projects missed out on £10m of government funding

A series of delays and disruption caused chiefly by changes in project ownership meant the government’s IoT UK Research and Innovation Programme failed to use a quarter of its allocated budget between 2015 and 2018

Alex Scroxton
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Published: 31 Oct 2018 14:45

A series of delays which occurred largely due to changes in project ownership within the government has resulted in the UK’s internet of things (IoT) Research and Innovation Programme missing out on £10m of its £40m funding pot, according to a new evaluation report released by the Department for Digital, Culture, Media and Sport (DCMS).

The programme comprises a number of different elements – Manchester and Cisco’s CityVerve smart city demonstrator; two NHS England-led IoT testbeds exploring the applications of the IoT in caring for those living with dementia and diabetes; the Petras academic IoT research hub; work by the Digital and Future Cities Catapults; and two accelerator schemes for small businesses run by R/GA and Startupbootcamp.

It was first announced in George Osborne’s March 2015 Budget in response to a series of recommendations made at the end of 2014 by the then chief scientific advisor to the government, Mark Walport.

The evaluation report, which was produced for DCMS by economic and social development consultancy SQW, revealed the programme was subject to “unforeseen delays at inception phase, largely due to changes to its main sponsor department (from the then Department for Business, Innovation and Skills, to DCMS, and for health projects, the Office for Life Sciences) and subsequent government decisions.

“This, and further delays in the inception of projects ‘in the field’, led to the total government cash funding (£30m) being a quarter (£10m) less than the original budget (£40m),” wrote the report’s authors.

Initially, CityVerve was to receive £10.3m, the NHS £10.1m (controlled by the Department of Health), Petras £10m, the two Catapult programmes £4.05m and the accelerators £6m for a total of £40.25m. The

However, the transfer of BIS teams working on technology and digital policy to DCMS following the May 2015 General Election meant things were held up partly due to personnel changes, and partly due to the fact DCMS at the time had very limited experience of running such programmes alongside the likes of Innovate UK.

Mistaken assumptions

Mistaken assumptions by both Innovate UK and DCMS sponsors about how the funding mechanism for the accelerator schemes also led to it becoming too late in the 2015/16 financial year to deliver their £1m slice of funding for that year.

Meanwhile, the Department of Health’s decision to fund two projects, not one, ended up having a total budget envelope of £6m, losing another £4m.

Finally, problems in establishing CityVerve led to a three-month delay, which DCMS then attempted to take account of by giving it an extra slice of funding for the 2016/17 year, paid for by reducing the accelerator budget over the same period by £1.5m or 60%. However this money was never needed and therefore never spent.

Ultimately, over the course of four financial years – with the 2018/19 period estimated – CityVerve received £11m, the NHS £6.03m, Petras £9.9m, the two Catapult programmes £4.89m and the accelerators only £920,000 for a total of £30.37m.

The government found that the rationale for the programme, rather than running separate projects, had been broadly felt to be conceptually sound at the beginning, but this had not necessarily been communicated to all stakeholders, leading to some inconsistencies in how the programme was understood, which spilled over into delivery issues.

However, it went on, the rationale still remained valid, although it had admittedly evolved since 2015, partly thanks to the advent of artificial intelligence (AI) and machine learning techniques in the context of the IoT, and partly because in some cases, the rationale for projects to address issues around information and uncertainty has moved on to a need to demonstrate that IoT applications are replicable.

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Nevertheless, the government’s evaluation determined that overall, the programme was well-placed to deliver its activities on time and within its revised budget.

“The evaluation has found good progress of delivery of programme activities and strong evidence of delivery of the outputs contained in the logic model for each constituent project,” said the report.

“Overall, delivery of the IoT UK Programme at aggregate level is behind the timetable anticipated in the original business case, but it has still delivered a substantial volume of activity at project level in a condensed period of time.

“Without the IoT UK Programme, much of the activity delivered would not have been undertaken at all, or at this scale and pace. In turn, the outputs would not have been generated, or would have been at a lower level or delayed.”

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