UK research and development spending trails EU average

TIGA, the network for games developers and digital publishers and the trade association representing the video games industry, has warned that the UK needs to increase its expenditure on research and development (R&D) to ensure it remains a world leading innovative economy.

The Office for National Statistics said that the UK ranked 11th out of 28 EU members on R&D investment. According to the latest figures, in 2016 the UK spent 1.67 per cent of national income on R&D, compared with an EU average spend of 2.03 per cent.

The pharmaceutical, auto, aerospace and computer programming industries were the biggest spenders on R&D. After business, the higher education sector was the second largest spending sector.

The ONS also found that:

  • Research and development (R&D) continued to grow, expanding by £1.4 billion to £33.1 billion in 2016, an increase of 4.3%, above the long-term annual average increase of 4.1% since 1990.
  • Most of this year’s growth came from the business sector, where it grew by £1.2 billion to £22.2 billion, an increase of 6%.
  • Funding of UK R&D from overseas fell for the second year running and in 2016 is 7% lower than the all-time high reached in 2014 of £5.6 billion.
  • Total investment in defence R&D was £1.8 bilion in 2016,up 4 per cent on 2015, but down 61 per cent in real terms since 1990.
  • Spending by the Government and the research councils fell to £6.5 billion in 2016, compared to £6.8 billion in 2013.

Increasing R&D spending and boosting productivity is a key part of the Government’s Industrial Strategy, which aims to raise total R&D investment to 2.4 per cent of GDP by 2027. It will see the Government invest £725 million in the Industrial Strategy Challenge Fund that aims to develop innovative uses of Artificial Intelligence and advanced analytic technologies among other measures.

Dr Richard Wilson OBE, Chief Executive Officer of TIGA, said:

“The UK needs to boost its R&D spending to ensure that it remains a world leading innovative economy.

“The Government has a lot of tools at its disposal to encourage further R&D spending. The tax system, including tax credits, matched funding, and loans and grants can be used to encourage private businesses to invest in research. The Government should look at how it can use these tools to ensure that UK R&D spending reaches at least the EU average. The Government must also ensure that the £31 billion National Productivity Investment Fund encourages greater R&D investment.

“R&D spending has the potential to boost productivity at a crucial time for the economy. Strong productivity growth would help the UK see off any potential headwinds arising from Brexit, while ensuring that UK businesses remain competitive on a global level.”

About TIGA

TIGA is the network for games developers and digital publishers and the trade association representing the video games industry. Our core purpose is to strengthen the games development and digital publishing sector. We achieve this by campaigning for the industry in the corridors of power, championing the industry in the media and helping our members commercially.

TIGA is intent on building an enduring organisation which continually improves; a business that will make a significant impact on the games industry and so benefit our membership and the wider economy. Since 2010, TIGA has won 24 business awards, an achievement which reflects TIGA’s drive for improvement and to meet best practice.

 

For more information visit: www.tiga.org

Get in touch:

Tel: 0845 468 2330
Email: info@tiga.org
Web: www.tiga.org
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Facebook: www.facebook.com/TIGAMovement
LinkedIn: http://www.linkedin.com/company/tiga

For further information, you can also contact:

Dr Richard Wilson, TIGA CEO at: richard.wilson@tiga.org