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NESTA's response to DTI Innovation Report

17/12/2003

"This report recognises that we are world leaders in the creative industries, but it fails to acknowledge the barriers faced by people working in them, or do enough to address them." Chris Powell, Chairman, NESTA

In a highly competitive and globalised marketplace, our ability to invent, design and manufacture the goods and services that people want is more vital to our future prosperity than ever before.

The Innovation Report, in conjunction with the recent Lambert review on University-Business Collaboration, and the Treasury's "Bridging the Finance Gap" document on access to finance for small business, have identified an enormous opportunity to address the barriers to business innovating and growing.

NESTA agrees with the Government that these issues should be part of a holistic approach to ensuring the creation of a culture of innovation and entrepreneurship. These issues cannot be managed in isolation, through a huge and expanding array of unconnected initiatives.

Commenting on the report, NESTA chairman, Chris Powell says it has missed two important opportunities:

the opportunity to encourage people to be innovative in starting up and growing their own businesses and;
the opportunity to make the most of the creative industries.

"The DTI needs to recognise more strongly the potential for innovation within small businesses and their contribution to the economy.

The Innovation Report, coupled with the Bridging the finance gap document, could have outlined measures to support investment in small, innovative businesses. We believe that high value-added businesses are a special case and should receive tailored support.

NESTA pioneers ways of supporting and promoting innovation and creativity across science, technology and learning. We were created to invest at the highest point of risk and innovation and to date, we have invested around £40 million in supporting the UK's talent.

We have found that too many of the people we support had to struggle to find appropriate finance - relatively small sums of money to protect their idea and take their product to market. We hope to work with government to ensure that more can be done to help them."

Commenting on the need to encourage the development of the creative industries, he said: "this report recognises that we are world leaders in the creative industries, but it fails to acknowledge the barriers faced by people working in them, or do enough to address them. Its primary focus is on Science and Technology. These are important and innovative sectors, but the creative industries also add enormous amounts of value. They are often overlooked by government and investors."

The UK creative industries contribute 8 per cent of GDP (equivalent to the construction industry) and are growing at more than twice the rate of the economy as a whole.

As such NESTA would strongly recommend that DCMS, the government sponsor for the creative industries within Government, is represented on the new Ministerial group on innovation. At present, the headline £150 million National Technology Strategy is focused on the science and technology sectors. Yet again the creative industries risk losing out despite their value to the UK economy and success.