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National Endowment for Science, Technology and the Arts (Increase of Endowment) Order 2006

rose to move, That the draft order laid before the House on 9 January be approved [14th Report from the Joint Committee]. The noble Lord said: My Lords, the endowment for NESTA—the National Endowment for Science, Technology and the Arts—is conferred by powers of the Secretary of State for Culture, Media and Sport under the National Lottery Act 1988. We propose to transfer to NESTA, over the next five years, £15 million a year from money held in the National Lottery Distribution Fund for expenditure on or connected with health, education or the environment. The fund was set up, of course, in 1998 to support and promote UK innovation, with a remit to support and promote talent, innovation and creativity in science, technology and the arts. I emphasise that the Government regard the history of the development of NESTA as most encouraging. As ever with anything to do with the cutting edge of technology, the arts and science, there are bound to be areas where initiatives achieve less than were hoped for—and there can, of course, be initiatives which excite a degree of controversy about their objectives—but, broadly, NESTA has played a very important role. It provides early risk capital which gives support to new ideas; it supports young, creative entrepreneurs; and it develops outstanding talent—the innovators of the future. This is a key stage in NESTA’s evolution as an organisation. It has clearly made great progress since it has been established, but we believe that it will be 10 years before the real impact of NESTA’s interventions will be felt. After all, these are seed-corn ideas, and seed-corn takes some time to germinate and develop. A condition of this additional funding for NESTA is that it is to use its own enterprise and creativity to secure its future beyond 2011. The Government are committed to following through on our long-term investment framework in harnessing innovation, so we will be conducting a thorough review of the organisation, evaluating its impact against a five-year plan objective, and looking at the endowment as an investment model more generally. We will also see what we can learn from NESTA’s success and how that can inform general policy, because we believe that there are areas of conspicuous success. One aspect is the development of the advanced transport system. The British Airports Authority is making an additional £7.5 million investment to fund driverless electric pods which will connect Heathrow Airport with surrounding car parks—an exciting project. We need innovation in relation to air travel in particular. We are all too aware of the relationship between congestion on the ground and rapid movement through the skies. That is an important dimension. There are many other illustrations of NESTA providing some interesting contributions. The main areas of its work are developing a culture of entrepreneurship; building dynamic networks that can be creative about problem-solving; risk funding—increasing the accessibility of seed-capital for the most promising new ideas and creating sustainable partnerships with the angel and venture capital community; and successful commercialisation—developing the business skills and market focus of new businesses and young management. These are exciting projects. NESTA is one of the most exciting developments of recent years. It is not 100 per cent successful—how could it be with such a range of creative and imaginative ideas? Nevertheless, it is worthy of support for an important dimension of British life where we give necessary small amounts of support to really creative, novel ideas which can come to fruition and produce quite startling investment realisations. On that basis, I beg to move. Moved, That the draft order laid before the House on 9 January be approved. [14th Report from the Joint Committee].—(Lord Davies of Oldham.)