Policy Background

Research policy is a significant part of Government policy on innovation, competitiveness and economic growth. The long-term UK research and development (R&D) strategy is laid out in the broader Industrial Strategy which sets out how the Government will boost productivity by backing businesses to create good jobs and increase the earning power of people throughout the UK with investment in skills, industries and infrastructure. The document identifies four Grand Challenges:

  • Artificial Intelligence and Data Economy
  • Clean Growth
  • Future of Mobility
  • Ageing Society

The Government places research and innovation at the centre of the strategy and aims to raise the R&D investment to 2.4% of GDP by 2027 through several initiatives to address future challenges in these priority areas. Each of the Grand Challenges is relevant to transport research and several areas of interest within this sector are identified in the document, including self-driving cars, mobility as a service and development of a fleet of alternative fuel vehicles. These areas of interest reflect the Government’s Net Zero initiative to bring all greenhouse gas emissions to net-zero by 2050.
 
The Industrial Strategy is supported by the International Research and Innovation Strategy which sets out how the UK will develop its international research and innovation partnerships to help achieve the targets set out in the Industrial Strategy. Although the Department for Business, Energy and Industrial Strategy (BEIS) is the government department primarily responsible for the Industrial Strategy, its implementation is a cross-government activity. There are also several other sector-specific R&D strategy papers such as Growing the Bioeconomy and the UK Digital Strategy.
 
Transport policy and research agenda are established through planning documents focusing on priority areas. Some of the most recent and relevant transport documents are:

Institutional framework of transport research

At both political and operational level, the responsibility of drafting R&D policy is held by the Department for Business, Energy and Industrial Strategy (BEIS) which is submitted to Parliament for approval and then incorporated into relevant strategic documents. Government’s Chief Scientific Adviser and the Council for Science and Technology advise the Prime Minister on science and technology policy issues across government, including research and innovation. Parliament is also supported by specific Select Committees and sub-Committees of the House of Lords and the House of Commons and the Parliamentary Office for Science and Technology

The responsibility of creating, drafting and implementing transport policy is held by the Department for Transport (DfT). Detailed transport planning documents are drafted by the Department on areas of interest established by the Industrial Strategy.

The executive agencies and trading funds central to delivering the Government's transport priorities and services are:

UK Research and Innovation (UKRI) is the national funding agency investing in science and research and implements the majority of the research and innovation aspects to support Industrial Strategy. It is a public strategic body which brings together seven research councils, Innovate UK and Research England:  

  • The seven Research Councils, divided by scientific discipline, support excellent research by providing grant funding, access to excellent research facilities and investing in infrastructure and institutions.
  • Innovate UK works with companies to de-risk, enable and support innovation, including through providing innovation grants and investing in Catapult centres.
  • Research England organises block grants to Higher Education Institutions.

Government investment in R&D is allocated largely through the ‘science budget’ which is allocated by UKRI. This is generally divided into resource and capital. Resource spending is used to cover the day to day costs of research and provides research and innovation grant funding. Capital spending focuses mainly on investment in infrastructure, such as laboratory equipment, setting up world-class research institutes and or creating innovation centres.

The UK Government also provides support to the private sector to help companies invest in R&D, through mechanisms such as e-tax credits administered via the Treasury. In addition, transport research can also be funded through EU and international partnerships and programmes.

Funding Sources and Support Initiatives

The research and innovation to achieve the Grand Challenges are primarily implemented by Industrial Strategy Challenge Funds (ISCFs), each of which is a fund to strengthen UK science and business innovation and to take on the biggest challenges that society and industry face today. Those that are of direct relevance to the transport sector are: 

  • Driving the electric revolution - This challenge will allow the UK to seize the economic opportunities from the global transition to clean technologies and electrification. The programme will help businesses across numerous sectors including transport, energy, construction and agriculture to invest and work together to capitalise on the UK’s strengths in this technology.  
  • Faraday battery challenge -  Through this challenge, the government will invest in research and innovation projects and new facilities to scale-up and advance the production, use and recycling of batteries. It will lower carbon and air pollution in the UK, while creating new opportunities and industries.
  • Future Flight - This Challenge will enable the UK to build, use and export new, greener ways of flying through advances in electric and autonomous flight technology. It will support the development, in the UK, of new technologies from freight-carrying drones to urban air vehicles to hybrid-electric regional aircraft.
  • Self-driving cars - The UK is a world-leader in technology enabling self-driving cars – a sector that is predicted to be worth £63 billion by 2035. The government aims to make the UK a premier development location for connected and automated vehicles. 

As well as the ISCFs mentioned above, The UK Government has set up a number of bodies and institutions to help to develop novel technology, processes and regulation to facilitate the introduction of transport systems that will revolutionise the way the people and things move:

These also have research and innovation programmes, and these are implemented by Innovate UK, the UKs innovation agency and part of UKRI.