The government’s ‘blue skies’ funding agency lacks purpose, MPs find

The government needs to clearly define the remit of its research funding agency, according to a report by the House of Commons Science and Technology Committee. 

The report said that the funding agency, which was originally announced in the Queen’s Speech in December 2019, lacks a clear purpose so far.

The “blue skies” funding agency, the main focus of which will be “high-risk, high-reward research”, was also mentioned in the 2020 Budget, where chancellor Rishi Sunak promised at least £800m for the agency, which is based on the US’s Advanced Research Project Agency (ARPA).

The UK version of ARPA has been announced on several occasions, the report said, but the government has not yet clearly identified the need for or the remit of the new agency. 

The committee said that the UK ARPA should be given an initial focus “by giving it a clear client – for example, a government department”. In the US, its ARPA has a relatively narrow focus, serving the US Department of Defense. 

The report said the organisation must be free to pursue research with a “greater tolerance for risk” than currently in the research system, and that research should focus on no more than two “strategically important missions aligned with the long-term needs of the nation.

The committee also said that government needs to establish a culture where research currently considered too risky to fund can be allowed to be pursued. 

“The government must also accept the long-term nature of high-risk projects and be prepared to wait 10 to 15 years for such research to pay off,” it said.

Commenting on the report, Science and Technology Committee chair Greg Clark said a UK version of ARPA has the “potential to find solutions to help address some of the greatest challenges facing our society – whether achieving net zero, preventing disease outbreaks or defending our nation against emerging threats”.

“The government's financial commitment to supporting such an agency is welcome, but the budget will not be put to good use if ARPA’s purpose remains unfocused. UK ARPA is currently a brand in search of a product,” he said. 

“The government must make up its mind and say what ARPA’s mission is to be. Only then can the necessary high-risk, but hopefully high-reward, research commence. I look forward to the government setting out its plans in some detail and hope that the committee’s findings will help to inform the shape of UK ARPA.” 

In March 2020, the chancellor promised £22bn a year for research and development (R&D). The private sector will also be expected to increase its R&D investment to meet the government’s target of the country as a whole spending 2.4% of GDP on R&D by 2027. To support this, Sunak announced that R&D development expenditure credit, currently at 12%, will be increased to 13%.

The Science and Technology Committee also called on government to conduct a review within the next financial year to explore how it can allocate funding to UK Research and Innovation (UKRI) with fewer bureaucratic constraints.