Brussels, 01 Sep 2004
The Confederation of Business Industries (CBI) in Scotland has asked the government to invest a further 185 million GBP (4 million euro) in research and development (R&D) to kick-start the country's low growth rate.
The Confederation's Chairman, Gordon Smith, said on 29 August that the 45 million GBP (66 million euro) allocated annually to Scotland's three Intermediate Technology Institutes (ITIs) must increase at least five-fold to secure Scottish industry's competitiveness.
He believes backing innovation is the only way Scotland will improve its sluggish growth rates and compete against other countries that are investing heavily in this area.
The ITIs are a good step forward but the money allocated to them is insufficient, he explained. 'The Scottish Executive has to look at how it spends its money. If we don't, then we'll be up against others that will: Singapore, India, China. None of them wants low-cost manufacturing either. We do not want to join as a small player.'
The ITIs were launched in 2002 as a response to a series of large scale industry closures and job losses in Scotland's hi-tech sector. They are designed to develop intellectual and innovative work and transform it into commercially lucrative products. A first in the UK, they are modelled on R&D schemes in Germany and Canada. They cover the energy sector, life sciences, telecoms and software.
Mr Smith explained that as a director of IBM in Scotland he is aware of the huge sums committed by multinationals to bringing new ideas to market, and the extent of global competition for higher value products and jobs. The sums allocated to the ITIs would be 'lost' at IBM, he explained, and therefore need to be increased dramatically.
'I have spoken to companies across Scotland and they say it takes too long to get support and the conditions applied to getting it are too strict.'
The CBI Scotland demands come at a time when the policy of spinning out research from Scottish universities is stalling because of new tax rules that affect cash flow at the early stage of development. Science Ventures, a company set up to back academic spin-outs in Scotland, has recently collapsed.