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Innovation incentivised to lead to uk manufacture
The UK chemical industry invests nearly £6 billion each year on R&D, one of the largest of any industrial sector. Through continued investment in R&D and ensuring this investment is commercialised in the UK, the sector can play a leading role in solving many of today’s issues, for example helping other sectors achieve net zero, such as through modern battery technology, cost effective green hydrogen production and insulation for homes, providing medicines to keep people healthy and helping prevent pollution, e.g. through chemical recycling of plastics.
Although the industry and related academic institutions have a proud record of successful R&D, the UK has been less good at commercialising these inventions in the UK, in what is a truly global industry. For this, we need an even playing field and the Government to ensure that regulatory and innovation investment is comparable with our major competitors in the US, Europe, China and the Middle East.
We welcome a number of recent announcements by the Government, including the Advanced Manufacturing Plan. We particularly welcome re-joining Horizon Europe; making the full expensing of capital allowances scheme permanent; reforms to the R&D tax reliefs to simplify and improve the system and increased funding for UKRI, particularly Innovate UK and the EPSRC.
We also welcome the focus on key areas where the chemical industry can play a vital role as a solution provider including battery technology, hydrogen and carbon capture and utilisation. However, it is still hard for companies to compete globally with recently announced packages such as the Inflation Reduction Act in the US and the more recent EU response, the Green Deal Industrial Plan.
- At least match OECD levels of R&D funding, to maintain quality and attract the best scientists and engineers.
- Look to simplify bureaucratic application and monitoring procedures when applying for Government funded R&D investment.
- Strengthen innovation ecosystems such as Catapult Networks and centres of excellence such as the Centre for Process Innovation (CPI).
- Improve incentives for inventions made in the UK to be commercialised in the UK.
- Continue to invest in AI and digital technology at world-leading levels and encourage uptake by industry, through de-risking implementation.
- Deliver long-term certainty for existing and prospective investors on the business taxation and incentives environment.
- Guarantee long-term support for the Patent Box.
- Provide greater recognition of the chemical industry as a leading solution provider, with similar direct support to other key sectors such as automotive and aerospace. As a vital supplier to key industries we need to be able to access funding allocated to the growth of other customer sectors.
