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UK Catapult program ‘systems’ approach a lesson for Australia

By Joseph Brookes

The UK Catapult network was established to drive industry and research collaborations and to intervene where market barriers exist to local innovation. A decade on, and the Catapults are now a critical piece of the UK innovation ecosystem and offer a blueprint for Australia.

With a total annual budget of A$1.3 billion, nine catapults scattered throughout the UK offer cutting-edge R&D infrastructure and technical experts to drive innovation through public and private partnerships.

The centres have played key roles in developing everything from gene therapies and new medicines, to towering offshore wind turbines, semiconductors and satellites.

UK Catapults could provide a blueprint for Australia

Since 2011, they have directed over A$4.4 billion of private and public sector investment, established over 2000 academic collaborations, 14,750 industry collaborations and supported more than 8000 small and medium sized businesses.

Regular reviews of the network’s performance have endorsed the role of Catapults, and backed further increased and secure funding.

The key driver of the catapult network’s success is its strategic approach and its place within a wider UK innovation strategy, according to Dr Nick Johnson chief strategy officer at the Cell and Gene Therapy (CGT) Catapult.

“You need to look at it in a little bit of a systems perspective,” Dr Johnson told InnovationAus.com in London.

The centres are targeted at areas of strategic importance with large market potential, and where the UK was considered to have the research and potential business capabilities to capture large parts of global value chains.

This network approach is not necessarily easy to replicate elsewhere, Dr Johnson said.

“You can’t just say ‘I want this thing in Australia’, if you’ve got no credibility [in the sector]. But if you’re looking at those things, where you’ve got an inherent edge and say, ‘right, we’re going to support that edge, or we’re going to really make a commitment to it’. That would be my take home.”

The Catapult network was established in 2012 based on Dr Hermann Hauser’s recommendations out of an international comparison. The Austrian born physicist and entrepreneur called for the establishment of a network of technology and innovation centres in areas where the UK had the potential to gain substantial economic benefit.

The centres are primarily funded by the UK government with five-year budgets, but are transitioning to a ‘thirds’ funding model to include industry and other grant program funding.

Today, nine centres exist, ranging from manufacturing and energy to satellites, smart cities, and semiconductors.

Each is a private, not-for-profit organisation. While governance, business plans, target outputs and measured outcomes are part of government grant funding agreements and create accountability, each centre operates with relative autonomously in achieving its goals.

“We are set up as expert organisations with expert people,” Dr Johnson said.

“One of the reasons we’re private organisations is the belief that you have to do that within the private sector to get the right people. So it would be, at a high level, counterintuitive that government then sets the agenda for organisations like ours.”

Each Catapult is constantly measuring its impact on their sector, often over several years because of the long runways in certain deep tech areas.

“We don’t want to claim that we created this whole industry in the UK,” Dr Johnson said. “What we will claim is that we can point to those interventions that we made, and we can show the difference that we believe that we’ve made to support those companies.”

For Dr Johnson and the CGT Catapult, one measure of success is the new cell and gene therapy facilities launched in the UK in just a few years.

“We built a center in Stevenage where we’ve supported a number of organisations to access unique capabilities with all the quality and regulatory infrastructure around it to take their products forward. But it’s a unique model whereby they own their own manufacturing processes, and they effectively occupy a space within it so they can control their own products. That’s been very successful.”

The Stevenage facilities are now at the heart of the largest cluster of gene therapy companies outside the US, Dr Johnsons said, and have gone on to attract billions in private investment.

Eminent Australian innovation expert and UTS Emeritus Professor Roy Green is impressed by the UK approach, which he says has not been replicated well in Australia.

“The UK Catapults generally work well for three reasons: first, because they recognise that contemporary industry policy does not prescribe but rather enables technological change and innovation in the context of nationally agreed missions and priorities; second, because they do not represent any single organisation or interest but are aggregators of relevant stakeholders, including research and education institutions, foreign direct investment (FDI) companies and local small and medium enterprises (SMEs); and third, because they do not try to ‘boil the ocean’ but rather apply cross-disciplinary capabilities to highly specialised global production systems and value chains.”

Professor Green told InnovationAus.com the approach in Australia has lacked the long-term, strategic view that has served the UK’s Catapults so well.

“Unfortunately, whenever Australia attempts to set up institutional structures of this kind, we slice and dice existing programs to end up with what usually turns out to be an inadequate funding envelope, and then we require the new entities to be financially self-sustaining after an impossibly short period of time,” he said.

“This was the fate of the Industry Growth Centres, with no replacement in sight, as the Industry Department reverts to the default position of short term grant programs like the Modern Manufacturing Strategy.

“No doubt such grants are welcome to the recipients, but they do not establish the longer term institutional arrangements and design thinking that we need to achieve competitive advantage in designated national priority areas.”

Major reviews of the Catapult program in 2014, 2017 and 2021 have generally endorsed their value to UK innovation and their respective industries.

Most of the centres still spend more money than they generate for themselves, with the best performers typically being the oldest — some with origins predating the catapult network.

The government has acknowledged in its reviews that individual centres may take more than 10 years to reach maturity.

The latest review found businesses and stakeholders are “positive about the difference they make”. The only concern raised was with some centres competing for work with the industries and universities they are designed to support. But this could be limited with a formal code of practice, according to the review’s recommendations.

“Our findings suggest that Catapults play a unique role in the system that stakeholders value, that their impact varies by sector and by time established, and that they are one, critical, part of the innovation ecosystem,” the 2021 review said.

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