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Science and Innovation (Sedgefield)

– in the House of Commons at 5:00 pm on 2nd April 2009.

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Motion made, and Question proposed, That this House do now adjourn. —(Helen Jones.)

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Photo of Phil Wilson Phil Wilson Labour, Sedgefield 6:04 pm, 2nd April 2009

I am grateful to have secured this Adjournment debate on science and innovation in Sedgefield. It gives me the opportunity to describe how the area has changed over recent years, and how it has reached out and grasped the technologies of the future that, only 10 years ago, belonged to the pages of science fiction, but which now are the fledgling companies of economic growth based on cutting-edge technological advances and innovation. That statement is not one usually associated with an area of the country whose traditional image remains, for a lot of people, one of coal mining. Today, I want to challenge that traditional view.

The slag heaps and pitheads have gone now, and those who are not from the area would find it very difficult to identify where they once scarred the landscape, because of the excellent reclamation work done by Durham county council. Even today, I am asked on occasion in London, when people realise I represent a constituency in the north-east, how long it takes to get there by train. "Does it take five hours?", they ask. In fact, it does not. To Darlington, my usual station stop, the train journey can be less than two hours 30 minutes from King's Cross.

I have heard it said that the location of the centre of science and innovation in Sedgefield, at NETPark, is not geographically correct because it is away from other centres of research and development, such as Oxford and Cambridge. I put such a statement down to a lack of understanding of what is going on in the area. It ignores the fact that Durham university, only a few miles away from Sedgefield, is one of the best universities in the world. If I may say so, that statement is infused with just a hint of regional snobbishness. The north-east is not on the other side of the world, and in our globalised economy the world is at our doorstep, not even a train journey away.

The last coal mine to close in Sedgefield was at Fishburn in 1974, some 35 years ago. The local coke works, also at Fishburn, closed in the mid-1980s. Both have gone, leaving a strong sense of community behind, but as I said, those who are not from the area would not know where the slag heaps and pithead stood, or where the chimneys at the coke works belched their stench into the sky.

Less than a mile to the south of Fishburn, on the site of an old psychiatric hospital, stands a cluster of less imposing buildings that are none the less important for the future prosperity of my constituents, County Durham and the north-east as a whole. This is NETPark, which is to play its part in creating a knowledge economy in County Durham in which tomorrow's jobs can be created today. It is fair to say that the north-east still faces significant economic problems, and although we are in the midst of a global economic downturn, progress has been made locally. Educational attainment levels are improving. The number of adults with qualifications and the number of businesses per head of population has increased above the national average. Today, there are 590 apprentices in my constituency; in 1997, there were, on average, only 20 per constituency.

NETPark is part of the north-east's strategy of building on those foundations by expanding the knowledge economy in the region and attracting high-value jobs with roots in the region, so that the prosperity of the north-east can grow. County Durham and the north-east have some world-class economic assets such as Durham university, which is ranked among the world's top research institutes. The university has strong links with NETPark and is one of the primary reasons NETPark is now seen as the most important science and technology park in the north-east.

What does the development of the knowledge economy mean for County Durham? The County Durham economic strategy 2008-13 sets out an ambitious programme, which underlines the importance of science and innovation for the county by growing the base of science and technology businesses. The most important ambition—it is starting to be realised but there is still much to do—is to commercialise the county's knowledge base and to increase the rate of spin-out and start-up companies emerging from NETPark, while working with One North East and others to address financial and other barriers to commercialisation, including manufacturing capacity.

The vision for me, as someone who has lived in the area all his life, is to ensure that the traditional industry of coal mining upon which the economy of County Durham was built over generations, and for which the county was known and is still remembered, is replaced by the traditional industry of science and innovation; and that, because of home-grown expertise, knowledge, imagination and determination, that industry remains a tradition long into a future in which change is a constant because of innovation, and the opportunities offered become part of the community, because cutting-edge opportunities are the way of life in the community. That will not happen overnight, but I do not see why such ambition cannot be realised in the long term.

NETPark is one of the key drivers in achieving that ambition. Let me tell the House about NETPark and what it has to offer. It was opened in 2004. The park was developed by Durham county council and is managed and promoted by County Durham Development Company. Its main focus is on nanotechnology, photonics, microsystems, energy, medical technology and printable electronics. The park is overseen by an advisory group, including One North East and the vice-chancellors of five universities in the north-east.

Let me describe just three of the technologies under development. ROAR Particles plc is a company based on the park. It is dedicated to the research, development and manufacture of nanotechnology-derived particles for forensics and counter-terrorism. The company has world-leading patented technologies that are not only superior to existing commercial products, but produce a whole new range of analysis. Using the particles as a powder, they can identify chemicals within minutes from a fingerprint, thus helping with the elimination of suspects and saving the police time and money.

Using the ROAR powder, fingerprints can be used to identify whether the person has been in contact with explosives, whether he or she smokes, has taken drugs such as cocaine or is using prescription drugs. Further research is under way to allow fingerprints to reveal the person's gender, ethnicity and age. I have also been told that, over time, the technology will be able to tell from a fingerprint what someone has had for breakfast.

Kromek uses a unique process for producing semiconductor crystals that dramatically reduces the cost of manufacturing X-ray scanners for security and medical applications, and improves the quality of the images and the speed at which they are produced. The company has attracted several millions dollars-worth of investment from US equity firm Amphion Innovations and is in talks with BAE Systems, the European Space Agency and Philips. The company opened on NETPark in January 2005, at which time there were two employees—today there are more than 40, and that figure is set to rise to more than 250 within three years. The company has won awards for its revolutionary work in colour X-ray technology and its development of X-ray explosives scanners.

The Printable Electronics Technology CentrePETEC—was opened last month by the Business Secretary, Lord Mandelson. As part of the opening celebration that week, 200 visiting chief executive officers and leaders of businesses from 10 countries attended a two-day event at PETEC, which shows the importance of, and the high regard for, the contribution that the UK and PETEC are making to this technology. PETEC was established with a joint investment of £6.3 million from One North East and the County Durham Economic Partnership, which included £5 million from The Northern Way. A further £3.8 million of capital investment was sourced from the European regional development funds, and the Technology Strategy Board contributed £2.1 million towards the first platform of equipment installation in the centre.

Printed or plastic electronics are set to revolutionise consumer electronics with the introduction of electronics printed on to plastic and paper products; there will be an impact across most sectors—the automotive, retailing, energy, health care, design and fashion sectors—from new low-energy lighting and flexible rollable displays, among other applications. I am pleased that PETEC is the UK's high-tech, national centre for the development of the printed electronics industry.

The UK is often criticised for being good at early stage science and invention, but poor at commercialisation. The scale of investment needed to develop new concepts to the point of commercial revenue is typically 60 times that of the initial research spend—many products and many small companies fail at that stage. PETEC has been set up to provide support for this type of activity. It works hand-in-hand with universities and industry to drive the exploitation of this technology, and by de-risking this early stage of development, it will greatly increase the rate at which plastic electronics will be delivered to the wider market place.

At this time of global economic downturn, the introduction of new and innovative products is exactly what is needed to persuade the consumer to start purchasing again and to encourage the economic cycle to move on. This emerging industry is addressing those very issues. The launch of PETEC is the UK's latest substantial commitment to this sector. PETEC has already become involved in accelerating the commercialisation of new products by incubating early applications with industry—both small and medium-sized enterprises, and large companies. The Government and One North East are to be celebrated for realising this opportunity at this time.

Last week, the Select Committee on Innovation, Universities, Science and Skills published "Engineering: turning ideas into reality", a report that used PETEC as a case study. It also highlighted the importance of this technology to the UK economy, when it stated on page 31:

"IDTechEx—a company that provides global analysis of the printed electronics industry—estimated that the worldwide market for printed electronics will increase from $1.18 billion in 2007 to $48 billion by 2017 and $330 billion by 2027".

To put it bluntly, I want a piece of that action for the British economy and the economy of the north-east of England.

The impact of PETEC on County Durham has already been felt. Following a strategic operations review in 2006, there was a serious prospect of the closure of Thorn Lighting in County Durham with jobs transferred to eastern Europe. That was averted by the intervention of the County Durham Development Company and One North East, which led discussions with Durham university—PETEC—and Thorn's parent company, Zumtobel. In consequence, 600 jobs were safeguarded and a previously manufacturing-only facility has had 10-plus research and development jobs created so that the company can access PETEC and university facilities and expertise.

The Select Committee report that I mentioned earlier recommends, in paragraph 130m that

"the Government...engage with the plastic electronics community, and...articulate a strategic vision for the development of this innovative industry."

Can the Minister tell me how his Department intends to engage with the industry? Can I ask him, or his ministerial colleague Lord Drayson, to meet representatives from PETEC, the County Durham Development Company and others to discuss the potential that both PETEC and NETPark offer, and to travel to Sedgefield to see the vision in person?

Lord Drayson, in his oral evidence to the Committee, said:

"The next six to nine months is going to be very important indeed for SMEs. The opportunity is there to work with the financial institutions to ensure that, particularly in the £200,000 to £2 million range of funding, we make sure that adequate capital is available."

The Select Committee report at paragraph 118 also states:

"However, a thorough review of the support offered to businesses as they transition from early stage R&D to manufacture may be required if UK companies are to be world-leading in production rather than just research."

Will the Minister let me know his view on those points raised by the Committee, and will he say what progress has been made in securing capital in the £200,000 to £2 million range from financial institutions? Those issues could be stumbling blocks in the future.

The Government are to be congratulated on the work that they have done in securing revenue streams for the science and innovation field that were not there before.

I want to see NETPark develop and offer employment to people in the area whose families probably came to Sedgefield over the generations to work down the mines. Those jobs should not just be cleaning windows and cutting grass, but innovative jobs so they can have work in the traditional industries of the future. In those jobs, my constituents should be able to learn new skills and, although change might be a constant, it should not be change that they fear, but change that they can enjoy because they are in control of it and because they too are part of the knowledge economy. That is why I strongly endorse this Government's approach to education for the many, not the few.

I also want to welcome NETPark's role in developing what is called an innovation connector, which will help engage local businesses, establish science networks and engage the local community. Innovation connectors provide a particular geographical focus for science and innovation activities, which will drive overall regional growth and at the same time boost the regeneration of a particular locality. They will enable the development of world-class facilities and new approaches to integrating business and universities, and will engage communities, particularly through education, awareness raising and access to employment programmes.

The innovation connector will be either located within, or in proximity to, localities that are experiencing particular disadvantages and which have limited cohesion with more prosperous parts of the region. Specific actions will be implemented to align investment and enable these excluded areas and groups to access and benefit from investment in growth. The concept is intended to link areas of need directly to new areas of opportunity.

As an identified innovation connector, NETPark is being supported through public funding with European regional development fund match funding to enable expansion and connectivity with other regionally funded activities and the local community. The programme of activity is drawn together through an investment plan, with a potential ERDF investment of up to £14 million. These projects are in development and there is no certainty that they will be successful in their application for ERDF and other funding. However, it is anticipated that a number of them will proceed to delivery.

As NETPark grows in importance I want to see it become an integral part of the local community, and for there to be a sense of ownership and civic pride in it. That will come when jobs are created as the park grows in size and importance. NETPark is a real success story for Sedgefield and County Durham. It is a true centre of excellence in science, technology and engineering that will be a key driving force behind the county and the regional economy in the future.

We are going through a global economic downturn. One day that will end and facilities such as NETPark, where the public and private sectors have worked together, will stand astride a burgeoning landscape of science and innovation ready to take on the 21st century. NETPark's vision is to be a world-renowned science park, leading developments in the commercialisation of research and development in electronic and related technologies and spinning out manufacturing and service companies across the county while connecting the whole of County Durham as a science park via NETPark Net, which will connect NETPark to businesses in County Durham and the rest of the region. Finally, it hopes to be the home to high-value business throughout the county, offering job opportunities for local people.

Although clean coal technology should have a future, the coal industry in County Durham will never be the same as it used to be, although the principles of compassion and solidarity remain in our communities. The coal mining era in Sedgefield has ended—may the new era of science and innovation in Sedgefield begin.

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Photo of David Lammy David Lammy Minister of State (Department for Innovation, Universities and Skills) (Higher Education & Intellectual Property) 6:21 pm, 2nd April 2009

I congratulate my hon. Friend Phil Wilson on securing this debate. His deep concern for the economic prospects of Sedgefield and its people is well known and he has raised this issue in the House on a number of occasions. As recently as 12 March, my right hon. Friend the Secretary of State had the pleasure of joining him in welcoming the opening of the Printable Electronics Technology Centre, or PETEC, in his constituency.

My hon. Friend's determination to focus on his constituency's future is all the more commendable because, as he mentioned, it is no secret that Sedgefield is an area that has known hard times in the past. In the early 1930s, one in eight men in this country was unemployed. In Sedgefield, it was one in three. Everyone knows how badly the whole of County Durham suffered over a period of years from the contraction of the mining industry, culminating in the terrible winter of 1984-85. We all welcome the passion with which he brings this debate to the House and the manner in which he talks about the prospects for Sedgefield. We are very pleased that there is a revival. As my hon. Friend said, one industry is gone but the prospects for the young people of Sedgefield, in particular, to engage in science and innovation and to be at the cutting edge of this country's future must be maintained.

Anyone who still thinks of Sedgefield and its surrounding area as a monument to lost industries needs to revise their opinions. A dozen years of effort and investment have turned it into one of the most economically exciting parts of this country. Sedgefield showed the world its capacity to innovate in 1997, when it returned to Parliament the first Labour Prime Minister in 18 years. With initiatives such as PETEC, it is continuing to prove a source of new and exciting ideas. That excitement is one reason why I very much welcome the fact that some of the £13 million of funding that the centre has received has come from my Department through the Technology Strategy Board.

It does not take a scientist to see the great potential that cutting-edge technologies such as plastic electronics have for this country, nor, indeed, how important initiatives such as NETPark are in helping to turn innovations into practical business propositions. The development of new industries and the regeneration of regions such as the north-east have depended very much on such developments. With the ongoing support of Durham county council, One North East and the five north-east universities—I was very pleased to visit Newcastle university just a few weeks ago and to visit the Student Loans Company in the constituency of Darlington—NETPark offers the chance to create high-value, highly paid jobs and to establish an infrastructure of support jobs in professional and community services.

I know that my noble friend Lord Drayson, the Minister for Science and Innovation, met representatives from One North East and the Science and Industry Council earlier this week. They discussed PETEC and the importance of science, innovation and technology for the entire north-east region, and he is hoping to visit the region and my hon. Friend's constituency later this year.

It is frequently said that, for every job created in a science park, another 2.5 jobs are created elsewhere, but we know that the ratio has been much higher than that in some places. As my hon. Friend rightly pointed out, that fact alone presents a strong argument in favour of Government support for science and knowledge transfer. That is particularly important at times like these.

My right hon. Friend the Prime Minister recently gave a lecture at Oxford, in which he said:

"Some say that now is not the time to invest, but the bottom line is that the downturn is no time to slow down our investment in science but to build more vigorously for the future. And so we will not allow science to become a victim of the recession, but rather focus on developing it as a key element of our path to recovery".

Indeed, investment in both science and knowledge transfer has reached unprecedented levels under this Government. By 2010, the science budget will have trebled from £1.3 billion in 1997 to more than £4 billion, while public funding for universities will have risen by 30 per cent. in real terms over the same period.

The Government have also provided more encouragement for universities to engage with businesses and to translate scientific discoveries into commercially marketable products. The higher education innovation fund, which we created, will be worth £150 million a year by the end of the current spending period. Our commitment to securing greater collaboration between higher education and business was reinforced further by last year's "Innovation Nation" White Paper and by our proposals on higher education at work.

That investment has already been reflected in a greater focus in the private sector on innovative, high-value products and services. In 2000, only 45 per cent. of UK companies were active in innovation, but that figure had risen to 68 per cent. by 2006. Plastic electronics is one of the fields to have benefited in particular from that investment. To date, the Government have invested more than £35 million in over 50 industrial collaborative research projects in that area alone.

Only a few months ago, the Technology Strategy Board announced approval of a £12 million project, supported by £6 million of grants, to develop full-colour flexible displays. A TSB-funded knowledge transfer network is also helping the development of businesses in plastic electronics supply chains. There are notable clusters around Cambridge in the south-east and in the north-east.

Those and other measures, such as research and development tax credits, provide substantial support to improve the performance and productivity of companies that are developing new technologies, by helping them to bring new products to market quickly. I know my hon. Friend will join me in acknowledging just how much benefit the Government's support for science, research and technology and knowledge transfer has brought to the economic regeneration not just of his constituency but of his region as a whole.

My Department welcomes the Select Committee report mentioned by my hon. Friend—"Engineering: turning ideas into reality". Its support for the UK's world-class engineering base is clear. It is quite a thick document, so it will take some time for the Government to respond, but we shall do so in due course. We take very seriously some of the recommendations that have been made.

The creation of new technologies and new products brings exciting new possibilities for the whole country, and the prospect of new and better jobs for its people. A few moments ago, I mentioned the extent to which the north-east economy suffered during the recessions of the 1930s and the 1980s. I know that the spectre of unemployment is still viewed by many people in the region as a real threat.

I am delighted that my hon. Friend has brought this debate to the House. The science and innovation in his constituency demonstrate what can be done, and the north-east is fast becoming a powerhouse in that field. I am pleased to support his desire to mobilise even further effort and I know that my noble Friend the Minister looks forward to visiting my hon. Friend's constituency. When I visit universities in the north-east, I, too, am keen to see such developments and, more important, how they work for local people.

I want to raise one further point, which is about what we now call "skills activism". We recognise that in the economic downturn we will need to be more proactive in helping young people and adults to identify future areas of growth. That will be important in my hon. Friend's constituency, and I suspect it lies behind much that he said towards the end of his speech about pointing his constituents towards what is clearly a much brighter future, notwithstanding the difficult times we are experiencing.

We in the Department for Innovation, Universities and Skills look forward to working with my hon. Friend and the regional development agency. I thank him for bringing the matter to the House.

Question put and agreed to.

House adjourned.

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