I was recently asked in an interview what advice I would give to an incoming government on how to increase innovation in our economy. Here is what I would recommend:
1. Make it as easy as possible to start a new business. Most radical innovations come from start-ups and we need a lot more of them. It is already reasonably easy to start a new business in the UK. However, we could further reduce administration and tax on new businesses e.g. no corporation tax for the first two years trading.
2. Increase the availability of loans for small and medium sized businesses (SMEs). At the moment many smaller enterprises cannot raise the finance they need to expand. We need to encourage venture capital funds, business angels and banks to invest in or lend to start-ups and smaller enterprises. This is risky so the government can help lay-off some of the risk.
3. Tilt higher education towards Science. Somehow our country has lost faith in Science. The media is cynical about Science in general. It is no longer seen as something that can solve problems and make life better. We need to rediscover the belief in Science and Engineering displayed by the Victorians. Many valuable high-tech start-ups come out of PhD studies or University research departments. We should encourage more bright students to take degrees and further degrees in Science based subjects. We should say that a degree in Physics is more valuable than a degree in History. One way to tilt the playing field would be to make tuition fees lower in science and engineering courses and higher in arts subjects.
We need more innovation in all parts of the economy including large corporations and the public sector. However, I would start with the SME sector. These three proposals would cost little but over a period they would encourage more start-up businesses and more high-tech businesses. This will help fuel innovation.
Paul Sloane
Reading your posting, I cam to think of another concrete example generating added value: http://www.fixmystreet.com/
Thank you for this post. I think it’s spot on.
With public spending cuts and large organisations having to downsize and some even be bailed out by government, any growth & new jobs will probably come from start-ups and SMEs.
To add to your 3rd point, I’d suggest that universities should also educate students about innovation and creativity right from the undergraduate level. It could benefit them in their studies and apparently one of the skills most highly valued by employers is creativity. So is enough attention given by HE and by employers themselves to develop this skill?
Frank – Thank you for this website – very interesting, might try reporting the pond sized pot hole at the end of my road. Will the council take any notice I wonder?