Part of the debate – in the Senedd at 4:46 pm on 25 May 2022.
I want to focus on the impact of Brexit on research and innovation funding, which clearly illustrates the assertion in our motion that post-Brexit funding streams are not working for Wales. So, why is this a problem? Research and innovation is absolutely fundamental to our nation's productivity and prosperity. It further helps us understand who we are and how we can best plan our future, enabling the research undertaken in our universities to have a positive and concrete impact on our lives here in Wales and far beyond. Nobel prize winner Andre Geim memorially summarised the value of fundamental research. He said,
'There's no such thing as useless fundamental knowledge. The silicon revolution would have been impossible without quantum physics. Abstract maths allows internet security and computers not to crash every second. Einstein’s theory of relativity might seem irrelevant but your satellite navigation system would not work without it. The chain from basic discoveries to consumer products is long, obscure and slow—but destroy the basics and the whole chain will collapse'.
And we needn't look further than the years of the pandemic to realise our need for the two cultures of the humanities and science. We need not look further than the climate crisis to understand why our lives quite literally are in the hands of our researchers.
The Welsh Government's 2019 report into protecting research and innovation after leaving the EU stated:
'Brexit will bring a significant reduction in overall UK R&I investment. Any loss of structural funding on this scale, unless addressed, will disproportionately threaten Wales’ productive research and innovation ecosystem, having managed over the past two decades to catch up and outperform other UK and many similar sized countries and regions in Europe and internationally in terms of research publication impact'.
It's clear that this prediction was spot on. What is lamentable is that neither the UK Government nor the Welsh Government have responded adequately since then to ensure the impact of the loss of EU funding is addressed, because the risks were clear. EU structural funds have played a critical role in Wales's research capacity. Wales secured around 25 per cent of the total UK allocation for the 2014-20 period—more than five times the UK average. During this period, Wales was allocated €388 million of the UK's total European regional development fund for research and innovation—the highest of any of the devolved administrations. And since 2014 the Welsh Government was able to invest over £500 million of EU-related funding in research and innovation. The loss of these funds, without adequate replacement, therefore cannot be overstated. And that's because currently, Wales does not achieve a share of the UK R&I funding equivalent to the share we should expect from the Barnett formula. In 2020 for example, despite Wales making up 5 per cent of the UK population, we received only 2 per cent of the UK R&D funding. Wales's level of R&D investment is significantly below that of the UK and EU averages. And this picture will only get worse as Welsh universities are disproportionately disadvantaged, given the high level of historical dependency on EU funding.
In 2018 Professor Reid's review of Government-funded research and innovation in Wales highlighted that, while the research and innovation ecosystem in Wales was strong, it lacked the scale needed to deliver Wales's full potential. And we all know that in most cases, to have scale, you need funding. So, how does the future of this crucial sector look, when 79 per cent of Wales's total EU funding for research and innovation is from those EU structural funds, and the shared prosperity fund falls hundreds of millions of pounds short of the 'not a penny less' empty promise? Well, it doesn't look good, because given the small scale of the Welsh research base, it's not realistic that increased success in the competitive UK R&I funding environment alone would be sufficient to grow or even maintain Wales's R&D at previous levels. Given this, the Welsh Government must urgently address this huge gap in funding, which will endanger our research and innovation capability.
Professor Richard Wyn Jones of Cardiff University has drawn attention to the consequences of the Welsh Government's failure to implement the full recommendations of the Reid review, which were designed to protect and strengthen Welsh R&I, in light of the damage caused by Brexit. So too have the Institute of Physics, the Higher Education Funding Council for Wales, the Royal Society of Chemistry, Cardiff University, FSB Wales and Universities Wales. In explaining the thinking of the Welsh Government, the economy Minister has pointed to the role of the internal market Act and the UK shared prosperity fund in reducing expected funding and related previous commitments.
While I ask all Members to therefore support our call on the UK Government to devolve responsibility over the new post-Brexit funding streams, I would also point out to the Welsh Government that the current situation is surely more of a reason for them to act now, to shore up the key driver of our nation's prosperity. Diolch.