§ 11.6 a.m.
§ Lord Holme of Cheltenham asked Her Majesty's Government:
§ Whether they are aware that, although the number of United States patents granted to the United Kingdom has remained more or less constant over the past 25 years, the United Kingdom's share of all patents granted has fallen significantly compared to other nations; and what action they propose to take.
§ The Parliamentary Under-Secretary of State, Department of Trade and Industry (Lord Reay)My Lords, patenting is a commercial matter. It is not for the Government to tell individuals and organisations whether and where they should patent their ideas.
§ Lord Holme of CheltenhamMy Lords, I thank the Minister for that reply, which perhaps illustrates the extent of the problem. I am sure that he is aware that the number of patents issued in the United States is normally used as an indicator of the level of innovation in various industrial economies. However, is he also aware that the percentage share of new patents issued to the United Kingdom has fallen over the period in question from 4.2 per cent. to 3.4 per cent.? Is he further aware that, although that is somewhat accounted for by a great increase in new Japanese patents, over the same period West Germany and France increased their share of new patents issued?
In the light of those facts, does the Minister believe that the 2.5 per cent. increase in real terms that the Government have allocated to the science budget in 1992–93 is anything like adequate? Does he agree that, in retrospect, the abolition of the near market funding under the SFI's scheme, set up by the noble Lord, Lord Young of Graffham, has proved to be a great mistake for our industrial competitiveness?
§ Lord ReayMy Lords, I agreed less with the noble Lord the more he proceeded. So far as concerns the statistics, I agree that patenting is an indicator of innovation. But it is certainly not the sole indicator. There are other indicators. For example, research and development in private firms funded by UK and overseas sources in this country grew by over one half in real terms between 1983 and 1989. However, I agree that patents are important. They can be a hallmark of the technical quality of products; they are important in the process of innovation. We therefore support the drive by the Patent Office to make British industry more aware of the services available to it.
§ Lord Taylor of GryfeMy Lords, can the Minister say whether the figures quoted by the noble Lord, Lord Holme of Cheltenham, reflect inadequate investment in research and development in the United Kingdom? That was highlighted in the excellent report of the committee of innovation published last year. Are the Government satisfied about the adequacy of funds being allocated to research and development so that our industry remains competitive?
§ Lord ReayMy Lords, I have already quoted the degree to which expenditure on research and development by firms increased over the past six years. I should add that the Government now spend about £3 billion on civil research and development. That is as high a share of national income as that spent by Japan. In regard to the science budget, spending has increased by 23 per cent. in real terms since 1979–80.
§ Lord Williams of ElvelMy Lords, will the noble Lord accept that the share of British patents in the United States is a genuine, real and primary indicator of the level of research in this country? Will he also accept that over the years the Government have slashed their own investment in research and development and have caused all five research councils to cut their budgets?
§ Lord ReayMy Lords, I have agreed that the Government believe that patents are important and that they can impress customers as regards the quality of products. A great deal of promotion is being undertaken by the Patent Office. The publicity unit of that office has for some years promoted the importance of protecting innovation through patents and the registration of trade marks. Patent Office expenditure on publicity was over £400,000 in 1989 and a budget of £1.67 million is planned for 1992.
§ Lord Holme of CheltenhamMy Lords, obviously the noble Lord does not have much taste for statistics. However, is he aware that in this country we spend half the amount per employee on research and development than is spent in the United States, and one third of the level spent in Germany? In my view, any complacency on the part of the Government is misplaced.
§ Lord ReayMy Lords, I gave the figures as regards what the Government have been spending in real terms and pointed out the increase that has occurred over the past few years.