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Accepting the challenge to build the world’s most innovative economy

Mike Biddle, Chief Operations Officer | Innovate UK

4 min read

Innovate UK's Deputy Executive Chair and Chief Business Officer Mike Biddle writes about how central R&D funding will address the four ‘grand challenges’ identified in the Government’s modern Industrial Strategy, namely: AI and the data-driven economy; clean growth; the future of mobility; and ageing society.


When the Prime Minister announced in November last year that the Government was setting a target to increase our spending on research and development to 2.4% of our GDP by 2027, it was a significant moment. It set the tone for the sort of economy the Government wanted to see. Not one where we’re doing more of the same, but one that is radically transformed and leading the world from the front – the world’s most innovative economy.
 
Achieving that goal, and making the most of our potential, requires us to build on our existing strengths and help our innovators, researchers and entrepreneurs to work together to create radical solutions to some the greatest challenges facing our economy and society.  
 
Far from business as usual
 
That’s where the Industrial Strategy Challenge Fund (ISCF) comes in. Run by UK Research and Innovation, the £1.7bn fund is a significant part of the greatest increase in UK government R&D funding for 40 years. The ISCF will develop UK industries that are fit for the future and drive progress in technologies where the UK can become a world-leader in their research and commercialisation.
 
But the Industrial Strategy Challenge Fund is far from just another Government grant scheme. To have the impact it needs to have, we knew the ISCF had to do things differently. So we drew on the model used by the US Defence Advanced Research Projects Agency (DARPA). The result is a mission-orientated programme, set by industry, with solutions provided by businesses and researchers working together. The challenges are designed to bring fresh ideas and entrepreneurial dynamism needed to create truly disruptive collaborations and solutions. We have also established clear accountability – with a Challenge Director making sure the programme is coordinated, managed and monitored effectively, to ensure we drive best value from the investment taxpayers are making.
 
Identifying the challenges that need to be met
 
These high expectations mean that being selected as a challenge is a highly competitive process. First, the challenges must fit within one of the four ‘grand challenges’ identified in the Government’s modern Industrial Strategy, namely AI and the data-driven economy; clean growth; the future of mobility; and ageing society. They must then meet the following criteria: 
  • it is compelling, focused, and articulated in a way that anyone will understand and see the benefit of solving
  • there are robust and well-evidenced data that indicate that the challenge will create economic growth
  • it is industry-led in an area of existing UK strength
  • it takes advantage of our research depth and expertise
  • there is a clear opportunity for growth with a sustainable global market and contribution from industry
  • evidence indicates that government intervention is necessary and of strategic importance to the UK
  • evidence indicates that solving the challenge will catalyse productivity growth.

 
The ISCF places a strong emphasis on high risk and high-return opportunities. This means projects may not achieve a 100% success rate because of technological and market uncertainties. Nevertheless, it’s important to explore and support new and promising ideas. That’s where great innovative leaps come from. 
 
In our first two years we have backed a diverse range of challenges, including transforming food production so we can feed a population of 9 billion people, encouraging healthy ageing for a society where 10 million British people will live to 100, and making sure we have the technology to allow all new cars sold by 2040 to be electric powered. 
 
We will be announcing more exciting challenges in the months to come, but the real excitement will come when we start to see UK companies creating the solutions that will help transform our society and boost the productivity and earning power of people throughout the UK.

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