The UK government – and the UK bioeconomy – are facing
uncertain economic times. Events both close to home and elsewhere make this a
trying time for business and government alike, yet plough on they must. To this
end, the UK government has published a “green paper” reviewing the country’s
industrial strategy. The report covers a wide range of areas, setting out ten
“pillars” upon which to build the country’s industrial strategy. These range
from the development of skills through education reforms and technical
qualifications, to supporting business growth through knowledge transfer,
supporting upscaling and encouraging sectors to work together. But what does
this strategy mean for the UK’s bioeconomy? In truth, that is unclear, as
bioeconomy sectors are all but absent from the report, but much can be inferred
from its contents that paints future opportunities for the bioeconomy.
Research & Innovation
The centrepiece of the paper is a commitment to Research
& Development in the UK, celebrating the country’s position at the forefront
of global scientific research. It laments the UK’s past failures to
successfully commercialise its developments, but promises to change that. The
government has pledged £4.7bn in science funding over the next three to four
years, but perhaps more importantly, they have announced a separate funding
outlet in the form of the “Industrial Strategy Challenge Fund”. This fund will
allow the government to directly invest in sectors and projects where it
believes the UK has potential to drive global development. One such sector the
paper specifically mentions is “biotechnology”, which is great news for the UK
bioeconomy, particularly in the bio-based chemicals and biopharmaceuticals
sectors. Elsewhere, another of the pillars focuses on “Cultivating World-Leading
Sectors”, one of which is highlights as being “Life Sciences”. Nothing is
discussed by way of what that means, but even advances in the broad area of
life sciences could have positive knock-on effects for the bioeconomy: for example,
improvements to genetic engineering could improve microbe-based processes such
as anaerobic digestion and algal biofuels.
Small Business Growth
Other signs are there that can be encouraging for bio-based
companies, particularly SMEs, with £400m pledged to form a “Business Investment
Bank” with the aim of assisting SMEs with scaling up. Though this may well
prove to be but a thin cushion, particularly in the bioenergy sector where
scaling up requires massive monetary investment due to the level of
infrastructure involved. Infrastructure itself is set for an overhaul, which
covers the energy sector, but only in definition – no actual proposals are made
regarding energy infrastructure.
Public Procurement
Another promising sign for the bioeconomy is the paper’s
pillar dedicated to “Improving Procurement”. This presents a great opportunity
for UK bioeconomy companies to get involved in the wholesale infrastructure
developments proposed in the paper. Here there is opportunity, particularly for
SMEs, to establish themselves in the public sector, something that has been a rarity
thus far in the bioeconomy. However, this prophesised emergence into the public
sector relies on a sympathetic administration, and if this paper is anything to
go by, this government hasn’t exactly been forthcoming with its support for the
bioeconomy. That, of course, may change with the right opportunities and/or
developments, but the lack of any direct addressing of the bioeconomy doesn’t
exactly inspire expectation. The government could look to adopt a model similar
to the US’s BioPreferred scheme to mandate bio-based product use in the public
sector where available, and to encourage consumers to switch to bio-based
products. The EU has been more cautious with its appraoch, with the OpenBio and
InnProBio projects looking for gaps in the market for biobased products, and
encouraging people working in procurement to favour biobased industry,
respectively. This is to ensure that the bioeconomy, if installed in the EU, is
not done so heavy-handedly. What effect either of the EU’s projects will have
is confined to the future, but doing something similar would provide reassurance
that the government is committed to the bioeconomy, and as a result would
stimulate growth in the sector.
Clean Growth
However, all is not lost regarding getting the government on
board with the bioeconomy: also among the pillars of industrial strategy is a
commitment to “clean growth”, which translates to decarbonisation of UK
industry. This proposal does not intrinsically mean growth of the bioeconomy,
as the government’s banner is firmly planted in the camp of offshore wind farms
and nuclear power where energy is concerned, and of electric and hydrogen
powered cars as opposed to biofuels. This could, however, spell an opportunity
in the biobased polymers and chemicals sectors, which becoming increasingly
linked with the automotive industry. Aside from this, the government do,
promise to publish an “Emissions Reduction Plan” later this year, which will
hopefully go into more detail of where the bioeconomy slots in with their plan.
Their focus is also clearly on cost over cleanliness, looking to “reduce the
cost of achieving our decarbonisation goals”. This implies that the bioeconomy
will have to bring its costs down before the government will consider getting
involved.
All things considered, the overwhelming message is an
encouragingly delivered “wait and see”, which is probably to be expected given
the present state of political and economic uncertainty. The take-home message
for the bioeconomy is that if it can catch Whitehall’s eye as a hub for
innovation and development, then a greater enshrinement into policy can be
expected, but until then it is business as usual. This paper is only a
consultation, and so nothing it lays down is set in stone, meaning there is
always opportunity for the bioeconomy to yet play a big role in the
government’s strategy.