Report

The Missing £4 Billion – Making R&D work for the whole UK

For many people and places across the UK, the economy never really recovered from the 2008 recession. Now the COVID-19 pandemic threatens to bring new disruption to an already fragile British economy, and to exacerbate entrenched problems that contribute to regional economic inequality.

This report examines one of these longstanding problems for the UK. The UK’s expenditure on Research and Development (R&D) – an important driver of economic growth – has historically been low compared to our competitor countries. The Government has committed to significantly increasing the amount that the UK spends on R&D by 2025. This investment is needed now more than ever as we rebuild the economy across the UK.

But the UK’s R&D spending, both public and private, is highly regionally imbalanced. This matters because R&D leads to innovation, and innovation creates productive industries and well paid jobs. Additional investment in innovation is essential but decisions on how and where this is spent will need to be made differently to really ‘level up’ the UK. We are at a rare moment where change is possible.

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