May 2002

Westminster Report, IEE Review

ETB to serve two million strong sector

With the main focus on the Budget and the 2002 local elections, it has been a quiet few weeks for engineering interests at Westminster.

One exception has been the indomitable Labour backbencher Claire Curtis Thomas who always does her best - against some apathy, it has to be said - to ensure that science and engineering is high up on the political agenda. Her questions result in some invaluable information about the state of engineering in this country. In answer to her question on the earnings on the services account by engineering consultancies, Trade and Industry Minister Brian Wilson said that in 2000, the engineering industry earned £1,449 million from exports overseas, representing 2% of UK exports and services. UK exports of manufacturing goods in 2001 were worth £160.7 billion, representing 84% of exports of goods.

In answer to further questioning from the MP, Mr Wilson informed the Commons that at least 2 million people are now employed in skilled engineering and technology. A new Engineering and Technology Board (ETB) has been established to support these individuals. The ETB aims to start the reversal of the downward trends in the supply of people with qualifications and skills relevant to engineering and technology, achieve a marked notable shift in public attitudes towards and understanding of engineering and technology and to build effective and valued links with business and industry, reflecting its real time and future needs. These are indeed worthy objectives and it will be interesting to see over the next few years, whether the ETB has been successful in its objectives. Having just been appointed a director (unpaid!) of the ETB, I intend to make sure it does.

In a debate in the Lords on Education and Skills, Conservative Peer, Lord Trefgarne highlighted the importance of encouraging young people to take up engineering. Noting that the evidence from the introduction of the GNVQ shows that young people from the age of 14 develop a significantly more positive attitude towards engineering, he urged schools to work in partnership with work based training providers, colleges of further education, and employers, in order to further encourage young people to take up engineering. He also observed that if the GCSE engineering qualification is to have any impact, the target required is that 350 schools would be required to offer this GCSE by 2005.

Lord Trefgarne noted that whilst there are a new set of arrangements for funding modern apprenticeships, with the funding made available by Learning and Skills Councils - which recognised the expense to employers of providing places and the higher value-added outcomes - in England, the funding is only available for the training of 16 to 18 year olds. This means that for those employers who train people over 19 years of age, the funding available is only 56% of the national rate. Lord Trefgarne reminded Peers that the engineering industry is particularly keen to attract people aged 19 and above.

In the same debate, former Education Secretary Lord Baker urged a rebirth of the old form of apprenticeship and asked the Government to give strong support for vocational training for engineers.

Roberts Report calls for increased investment

To its credit, the Government is making efforts to encourage more young people into engineering. Indeed, the Department for Education and Employment has commissioned a special report, commissioned by and authored by Sir Gareth Roberts, President of the Science Council. Published in April, the Roberts Report confirmed that there are emerging shortages in the supply of high-level mathematics, physics, chemistry and engineering skills, due to increasing demand by employers for those skills and fewer students choosing to take these subjects at A level and at University.

To remedy these deficiencies, the report recommends increased investment in the modernisation of school and undergraduate teaching laboratories, improved funding, training and career paths available to postgraduate students, changing the training and remuneration to encourage recruitment and retention of engineering teachers and improving the opportunities for scientist and engineers offered by R&D. I would strongly recommend that IEE members read the full report - it can be accessed via the web at (www.hm-treasury.gov.uk/Documents/Enterprise_and_Productivity/Research_and_Enterprise/ent_res_roberts.cfm)

The Government's response to the Roberts report came in the Budget. In a welcome admission, Gordon Brown acknowledged that "skilled scientists and engineers can only undertake world class research and innovation if they are properly motivated, funded and directed". In order to complement the work of the Roberts Review and in preparation for the 2002 Treasury Spending Review later this year, the Government will be taking forward a cross cutting review of science and research in the UK. Let us hope that this Review results in some fundamental changes that will transform the prospects for science and engineering in this country.

One helpful measure emanating from the Budget, which will benefit the science and engineering industry, is the extension of a research and development tax credit to a wider range of companies. The tax credit will be available to all companies that do not qualify for an SME credit. For R&D expenditure incurred on or after 1 April 2002. The credit, which will take the form of a super-deduction against income chargeable to corporation tax, will be given at a rate of 125% of all qualifying R&D expenditure. Although this tax credit will be very beneficial, I can only hope that its positive effects will not be overwhelmed by the increase in employers' national insurance contributions.

DTI awards £4 million for solar projects