13.03.13


Short-termism within British Business - Issue of the Week - 06 March, 2013

The Cox Review, published this week, presses concerns about UK businesses' predominant focus on short-term results to the detriment of their longer-term success. It warns that short-termism is damaging British industry and UK economic competitiveness.

The Review highlights several areas of concern, including the government and businesses' comparative under-investment in the UK research base. It writes that, "short-termism curtails ambition, inhibits long-term thinking and provides a disincentive to invest in research, new capabilities, products, training, recruitment and skills."

Problems for the UK's research base

Currently, our research excellence is only second in the world to the USA. But continued under-investment in our research base will sorely damage our world-leading research output.

Other countries, including fast-growing emerging economies and our European competitors, have prioritised investment in higher education, skills and research. If the UK is to continue competing at the world class level, it must remain a trailblazer in both established disciplines and emerging areas of research alike. All of this highlights the importance of resourcing both applied and blue skies research through a dual-support mechanism.

The Review recommends that investment should be targeted at "those sectors, or even sub-sectors, in which the UK can realistically achieve world leadership. This funding cannot all come from government. Industry [...] has to play its part, but state investment in research must be restored to an internationally competitive level."

It goes on to warn that direct research funding is not the only factor important for maintaining the UK research base. The postgraduate crisis, which the 1994 Group have also warned of, is likely to have an impact too. As the Review highlights, "the UK is one of only three countries [in Europe] with a progression rate of less than 10%" for postgraduate study.

The low number of students moving on to postgraduate study puts a bottleneck on future UK science and research excellence. This problem could become especially acute as students who have paid increased undergraduate tuition fees come through the system.

Recommendations

The Cox Review recommends that "[s]tate spending on research should be progressively increased" and "[p]ost-graduate education must be put on a par with our main economic competitors."

We welcome these suggestions. They will help secure a sustainable future for UK research; it is important to encourage companies to engage with universities, and we believe the dual-support mechanism is paramount to UK economic success.

The 1994 Group will continue to press government on postgraduate funding, and we hope that this report will encourage all parties to look for a long-term solution to nurture the next generation of researchers and scientists.

In times of austerity we understand that there is pressure on the Exchequer, but there is a package of substantive measures that the government can implement at no extra cost, including working with business to support specific industries, encouraging banks to make more Professional Career Development Loans available, and loosening restrictions on integrated Masters degrees.



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