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Big Innovation Centre: UK faces a 'lost decade' of stagnation in growth and jobs

David Woods , 08 Sep 2011

Will Hutton

Without urgent coordinated action across Government, business and finance, the UK faces a "lost decade" of stagnation, according to The Big Innovation Centre.

The Big Innovation Centre is an initiative from The Work Foundation and Lancaster University to be launched today with the backing of business secretary Vince Cable, leading businesses and universities.

Its inaugural report says the Government must act now to adopt a strategy of collaborative, entrepreneurial investment in those areas likely to bring the greatest dividends in growth and jobs.

The report argues that without major change the country faces stagnating living standards, mounting deprivation and a growing structural trade deficit. The government must work alongside business and finance to invest in the UK's ability to take advantage of the enormous opportunities provided by emerging technologies, chiefly the digital and low carbon economy, health science and healthcare, cyber-security and virtual reality. These are today's equivalents of the steam engine, electricity or the internet - the so called 'general purpose technologies' (GPTs) that change the world and drive growth and job creation.

Will Hutton (pictured), chair of the Big Innovation Centre and co-author of the report, said: "Britain is in an economic corner, and we must now innovate our way out of stagnation. This requires a wholesale shift in the way we think about growth. We need an enterprising state co-creating with business and finance - in short, an innovation 'ecosystem'.

"Britain's patchwork of institutions, networks and public agencies is not fit for purpose. Too few firms and public bodies have a grip on how to benefit from 'open innovation' - the key to change in the twenty first century. Backed by leading businesses, the Big Innovation Centre aims to be the catalyst the UK so badly needs - thinking, influencing and, just as importantly - doing.

"The state must take the lead on this because confidence among businesses is so fragile at present. The government has already recognised the importance of this agenda but the time has come to make it happen."

The reports recommendations include:

  • Building the Technology Strategy Board into the most effective global grant giver for research into GPTs and their application;
  • Working to develop the most globally sophisticated national network of Technology and Innovation Centres, organised as far as possible on open innovation principles; and
  • Co-developing with financial institutions a structural shift that creates a more effective supply of equity and loan finance to support innovative small and medium enterprises.

Hutton added: "We aim to change Britain - to deliver a step change in its capacity to innovate and generate wealth. Nothing more; nothing less."

 

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Astute move but...

Unlikely Monicker 08 Sep 2011

Politically this is an astute move which creates a corner from which business and manufacturing can fight the banks for a bigger share of state handouts/bailouts while deflecting the blame for stagnation on to the Government. But behind the rhetoric it's really just another forlorn example of Keynesian wishful thinking. The real impediments to growth are physical rather than economic. Net energy supplied by fossil fuels is falling rapidly and can't be made up-for by renewables or nuclear power, making the sort of growth in GDP seen from the late 18th century to the end of the 20th century unrepeatable for already-industrialised nations. Add-in unprecedented levels of unrepayable debt and it's obvious that low or negative growth will be baked into most western economies for years or decades to come, until their energy needs are aligned with the diminishing quantities available. Of course we need innovators, entrepreneurs and dynamic companies - more than ever before. But if the Big Innovation Centre channels their efforts into trying to resuscitate an economic paradigm that's had its day, then it will simply waste precious time and taxpayers' money chasing ghosts

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