The UK might be the most inventive country in the world. Think of all the technologies which only came about thanks to British research: the world’s first commercial jet, computers based on Charles Babbage and Alan Turing’s ideas, lithium-ion batteries which stemmed from the research of John Goodenough at Oxford. And now think of the countries that currently dominate these technologies. Britain doesn’t come to mind. Our inability to turn inventions into domestic industries is almost a disease.
Which is where the government’s new plan for an Advanced Research & Invention Agency (ARIA) comes in. ARIA aims to ‘fund the most inspiring inventors to turn their transformational ideas into new technologies, discoveries, products and services.’ The concept was devised by Dominic Cummings who wanted a UK version of ARPA, the US Advanced Research Projects Agency. ARIA, according to the government will shape ‘the country’s efforts to build back better through innovation.’
ARIA is a great idea. It should be celebrated. The country needs it. But it is far from a cure for the problem that plagues British innovation and the economy. In general, we have a big problem in Britain with a lack of retention, commercialisation, and manufacturing when it comes to new technologies. And as the EU’s vaccine nationalism shows, where something is manufactured matters. A lot.
To understand the potential limitations of ARIA here, it is helpful to look more closely at the original DARPA it is based on (the ‘D’ for defence was added to the agency’s name in 1972). The agency was established in response to the launch of Sputnik, with a mission ‘to make pivotal investments in breakthrough technologies for national security.’ DARPA is a catalyst for revolutionary technological innovations. It funds projects that connect basic science with engineering applications to reach a tangible goal. The F-1 engine that powered the Saturn V rocket and stealth planes that can evade radar came out of DARPA. Its inventions are turned over to the military for implementation.
Whether they lead to new industries in the US is another matter. The technologies are typically ‘pre-commercialisation’ meaning there is no obvious market for them. Though DARPA tries to commercialise them, in this regard it is no match for the Chinese government. DARPA made huge advances in drone technology; drones today are a Chinese industry. DARPA pioneered LCD flat panel displays used in consumer devices such as mobile phones. They are now entirely manufactured within two time zones in Asia.
A US biodefence expert and former DARPA programme manager explained that, ‘all we do is demonstrate. We show if it flies. But we have a problem at handoff. Somebody needs to land the thing.’
Which is why when the UK launches ARIA, it needs to find a way to ‘land’ the transformative technologies it develops. A vision of how to retain, commercialise, and manufacture these technologies is just as required. China has a very successful vision of how to do this – a China Inc. model using subsidies and state-owned enterprises guided by Five-year Plans – which hardly relies on magical thinking about markets.
The UK doesn’t have to copy China, but it does have to find new ways to finance the scaling up of these technologies, given that venture capitalists don’t like to fund new factories. The UK could copy the US and line up a ministry to further develop and use these technologies. Creating a path to commercialisation and domestic manufacturing might even ultimately entail the dreaded words, ‘industrial strategy’.
The government does have an obvious source of expertise and inspiration though. Buried in the reports about the vaccine taskforce is remarkable information. It turns out that the government had already been making ARIA-like investments in developing vaccines since 2012. These investments were focused on translating basic research into vaccine technologies, and aimed to improve manufacturing processes. The taskforce itself built a vaccine portfolio and funded clinical trials and manufacturing.
Maybe the way forward, therefore, is an ARIA partnered with a new entity modelled on the vaccine taskforce but focused on other technologies. The UK’s triumph in developing and manufacturing vaccines makes it a world leader in executing this model. Its success was most certainly not centred on the government’s big new ideas: a super-deduction tax credit for manufacturing, or ‘build back better’, whatever that means. The UK needs to try something different for once. Rather than repeating its failures, it’s time Britain learned from its successes.