7.31 There is widespread concern within the industry at the level of investment in research and development. This was identified as a serious issue in "Building Towards 2001", which added that the low or nonexistent level of profitability within the contracting sector left little funding for such vital activity. Investment comes mainly from public bodies (some of which have since been privatised such as the water industry) or from manufacturers/suppliers. Some very valuable projects have also been commissioned and funded by clients64. But a recent Discussion Document65 by a CIC working party expressed the view that "UK spending on construction research and its dissemination is substantially below that judged necessary by a succession of authoritative studies".
7.32 As with other construction industry problems, the United Kingdom is not alone in its disappointing level of R & D investment. The EC/W SAtkins report found that, within the EU, "The total level of construction research is low, and needs to be raised nearer to the average of other industries. The EU spends much less than Japan on construction R&D". It advocated that "R&D expenditure on construction needs to be increased from its present level of about 0.1 % of GDP to at least match the average of other sectors, around 0. 2% of GDP and must be shared by Government, industry and clients. This would be equivalent to 2 - 3% of construction industry turnover". The United Kingdom appears to be a very long way from either target at present, although it did achieve the 0.1% figure throughout the 1980s66. The Institution of Civil Engineers, quoting a DOE analysis, says that "the comparable ratios for France and Germany are 50% higher than the UK while the Japanese ratio is five times greater", and comments "this poor performance does not augur well for the future competitiveness of UK contractors and consulting engineers in terms of their improved productivity leading to reductions in basic cost" (ICE evidence, November 1993).
7.33 There are some specific problems relating to the United Kingdom research programme. The Director General of CIRIA pointed out:
1. "The fragmented nature of construction is such that individual companies cannot appropriate the benefits of investment in such research, especially that to do with the construction process and the integration of design and construction. For this reason, while there is some investment in confidential research by individual companies, especially material producers, whose results will be exploited commercially by those companies, there is little investment in research which is of general benefit."
2. Regarding technology transfer, "Those active in the dissemination of information ... do not appropriate the benefit." (Letter from Dr Peter Bransby, November 1993.)
7.34 In its evidence, the Concrete Society reports that only about 10% of current research on concrete is geared towards improvements in productivity and quality. It has sought to establish a new industry wide focus for identifying and promoting market-led developments, through the formation of a Technical Development Board of key industry leaders from the concrete sector. A development strategy is now being proposed which gives a high priority to improved dissemination of information to "ensure that industry at the sharp end gains competitive edge and value for money from its use of concrete".
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64 See "Profit from Innovation", CIC, 1993. Several Universities and other Institutions are heavily involved in client funded research. The development ofthe Centre for Window and Cladding Technology at Bath University is a highly praised initiative.
65 "Private Funding for Construction Innovation and Research - Options for a National Initiative, a Discussion Paper", prepared by a Working Party of the CIC Research & Development Committee, CIC, January 1994.
66 In a recent lecture, Dr Peter Bransby, the Director General of CIRIA, estimated that the UK's current investment on R&D is around 0.03% of output. (Unwin Lecture at the ICE, April 1994.)