National Research Development Corporation (Hansard, 23 April 1963)

§ 17. Mr. Millan
asked the President of the Board of Trade what was the amount of National Research Development Corporation expenditure written off in each of the past three years because of the cancellation of unsuccessful development projects.

§ Mr. D. Price
My right hon. Friend is informed by the Corporation that the approximate amounts written off were: £141,000 in 1962; £189,000 in 1961; and £21,000 in 1960.

§ Mr. Millan
Has the Parliamentary Secretary seen the criticisms of the present financial arrangements contained in the Corporation's last Annual Report? In view of the Corporation's very fine record and the fact that it has demonstrated that it has by no means any tendency to squander money, is it not time that the financial arrangements were changed so that it did not have to carry forward balances year after year without any opportunity of writing them off?

§ Mr. Price
I think that the hon. Member knows that so far the Corporation has not recovered enough profit from successful ventures to cover both capital and interest charges, as well as the costs of unsuccessful projects. However, it is important that its financial arrangements should be sufficiently flexible to support projects whose immediate commercial benefit is at least doubtful.

§ Sir H. Legge-Bourke
Would not my hon. Friend agree that one of the main objects of the National Research Development Corporation is that it should undertake work likely to be very long-term in showing any profitable return? As this inevitably means that 13 some of the risks are bound to be rather heavy, does he think that the figures which he has announced this afternoon are in any way unexpected?

§ Mr. Price
I would agree with a great deal of what my hon. Friend has said. I see that there are many Questions today about the National Research Development Corporation. I very much hope that we might have an opportunity some time to have a proper debate on this subject.

§ Mr. Snow
Is the hon. Gentleman satisfied that the work of the N.R.D.C. is sufficiently known among smaller specialising firms? Is he aware that at least one of his colleagues takes the view that small firms are not appropriate bodies to receive the Bulletin, for instance? As there is much propaganda about private firms originating developments which were in fact originated by the N.R.D.C., will he see that its work is made more widely known?

§ Mr. Price
The hon. Member will know that the Corporation is independent in its day-to-day management. It makes very serious efforts to try to get across to industries, of all sizes and all over the country, how it can help and what its function is. If the hon. Member would let me have details of firms which he thinks would benefit from contact with the N.R.D.C., I would be glad to assist him.

§ 18. Mr. Willis
asked the President of the Board of Trade what opportunity is afforded to the National Research Development Corporation to augment its income by entering into trading transactions based on the commercial exploitation of selected projects which have been successfully developed under its sponsorship.

§ Mr. D. Price
Section 1 (4) of the Development of Inventions Act, 1948, requires the Corporation to entrust the exploitation of its inventions to the industry concerned unless the Corporation considers there are special circumstances which otherwise require. Subject to this condition, the Corporation can and does enter into trading activities.

§ Mr. Willis
Is the Parliamentary Secretary aware that this is a very severe restriction upon the Corporation's trading activities? Would it not be better if the 14 Corporation were given power to exploit its own developments rather more freely in order to be able to build up reserves and to spend more on new developments and to stand its losses much better than it can now?

§ Mr. Price
The hon. Member will be aware that it is in the nature of the Corporation's activities that many of the things it finances are unlikely to be very profitable. Many of them are financed at a loss. However, it needs only one or two successful ventures and the Corporation's finances will be completely altered. If the hon. Member would like to write about any particular instance he has in mind, I should be very happy to discuss it with him.

§ Mr. Willis
If the hon. Gentleman reads the Corporation's Annual Report, he will find complaints about all these things. After 16 years, is it not time that we once again examined the Corporation's powers, functions and financial structure?

§ Mr. Price
The hon. Member's interpretation of the Report is rather different from mine. I should be happy to discuss with him any particular instance which he has in mind, but I do not think that we get anywhere discussing these things in generalities.

§ 19. Mr. Hoy
asked the President of the Board of Trade what is the average annual cost to the National Research Development Corporation of assessing the potentiality of the inventions submitted to it each year.

§ Mr. D. Price
My right hon. Friend is informed by the National Research Development Corporation that about a thousand inventions are assessed every year, mainly by the permanent scientific and technical staff who are also concerned with development and exploitation. Their salaries were £172,580 in the year 1961–62.

§ Mr. Hoy
Will not the Parliamentary Secretary agree that this sum seems abysmally small in view of the size of the job which the Corporation does? May we have an assurance that its work is not being restricted by lack of cash? What is the likely contribution from industry and how does the hon. Gentleman propose that the Corporation should be able to recoup the money it has spent?

§ Mr. Price
If the hon. Gentleman will put down a Question on the specific point in the second part of the supplementary question, I will be happy to answer him. He will appreciate that we do not accept direct responsibility for the Corporation's day-to-day management and that I have to get technical replies from the Corporation and cannot give them off the cuff.

§ Mr. Hoy
Can the hon. Gentleman assure us that lack of finance does not prevent the Corporation from doing the job it is given?

§ Mr. Price
To make a very broad generalisation, which is borne out by fact, the frustration—if one likes—of the full development of the Corporation's potentialities has not been due to lack of finance but because there has not been quite as many good ideas as one might have hoped.

§ 21. Mr. Lawson
asked the President of the Board of Trade what proportion of National Research Development Corporation expenditure on the hovercraft, electronic computer, and dracone projects is being spent in Scotland.

§ Mr. D. Price
The National Research Development Corporation is responsible for managing its own affairs, including the placing of contracts. My right hon. Friend understands, however, that the answer is four.

§ Mr. Lawson
Four what? Did I understand the hon. Gentleman to say four, meaning 4 per cent.?

§ Mr. Price
No, four projects.

§ Mr. Lawson
The Question asked what proportion of this specified type of work was being done in Scotland.

§ Mr. Price
I apologise to the House. I read the wrong Answer.
I should have said that the National Research Development Corporation is responsible for managing its own affairs, including the placing of contracs. My right hon. Friend is informed, however, that development of the hovercraft is taking place in Scotland as well as elsewhere. The extent of expenditure on this development in Scotland is, for commercial reasons, a matter which the Corporation would not wish to disclose.

§ Mr. Lawson
It seems strange, and I am sure that my hon. Friends will agree 16 with me, that we cannot be given the proportion. We are not asking how much money is being provided, but what proportion is being spent in Scotland.

§ Mr. Price
As the hon. Gentleman knows, where Corporations like this work with industry, figures must not be given which would indicate how much an individual firm is getting, and in this case even a percentage would indicate too much about individual firms.

§ Mr. Jay
What possible commercial reason can there be why the general proportion going to Scotland should not be given without providing specific details?

§ Mr. Price
This is a specific Question on hovercraft, electronic computers, and dracone projects, and the right hon. Gentleman knows that some of the firms involved have activities in Scotland and in England and it would be very difficult to break down the figures.

§ Mr. Jay
Is the hon. Gentleman saying that he cannot answer the Question because it is impossible, as he calls it, to break down the figures, or is he saying that there is some commercial reason against it?

§ Mr. Price
In fact, it is both.

§ 22. Mr. Small
asked the President of the Board of Trade how many of the thirty-five development projects being given financial and other assistance by the National Research Development Corporation at the end of the 1961–62 financial year were being developed in Scotland.

§ Mr. D. Price
The National Research Development Corporation is responsible for managing its own affairs, including the placing of contracts. My right hon. Friend understands, however, that the answer is four.

§ Mr. Small
Does the hon. Gentleman recognise that the figure of four is very low, and in my opinion is too little? It does not indicate whether it is a major or a minor development, and one assumes that a figure of four is a minor development. To retain technical personnel in Scotland, will the hon. Gentleman use his good offices to try to bring more of these development projects to Scotland?

§ Mr. Price
One would be delighted to do that, but I think the hon. Gentleman 17 recognises that there have to be the projects coming from Scotland to be worthy of the Corporation's support. It works both ways.

§ 23. Mr. J. Bennett
asked the President of the Board of Trade how many of the twenty-three potential development projects under consideration by the National Research Development Corporation at the end of their 1961–62 financial year have now been commissioned; and what proportion of these has been placed with enterprises in Scotland.

§ Mr. D. Price
The National Research Development Corporation is responsible for managing its own affairs, including the placing of contracts. My right hon. Friend is informed, however, that none of the projects referred to has yet been commissioned.

§ Mr. Bennett
Is the hon. Gentleman aware that that reply is disappointing and that if such a rate of progress continues it bodes ill indeed for Scotland?

§ Mr. Price
The hon. Gentleman may be interested to know that one of the twenty-three projects was proposed by a firm in Scotland.