UK less innovative than Belgium, says EU

The UK is less innovative than Belgium, according to a report by the European Union, which accused government and businesses of not spending enough on research and development.

The European Innovation Scoreboard report rates member states in terms of R&D spending, innovation and entrepreneurship measures, and development of intellectual property.

The UK ranks seventh on the scoreboard out of the EU 25 member states, behind Austria, Denmark, Finland, Germany, Sweden and Belgium.

Given the strong policy push in the UK to increase private funding of university research, the continual decline of university R&D funded by private companies - from 7.3 per cent in 1999 to 5.6 per cent in 2003 - is a "major failure of UK innovation policy", the report said.

It added: "This decline is probably contributing to the crisis in the public research sector, due to inadequate public funding and the assumption that the gap would be covered by private sources."

Business R&D is also below that of many of its peer performance countries and the report added: "The second challenge for the UK is to improve the innovative capabilities of its SMEs. A below average percentage innovate in-house or are involved in innovation co-operation."

UK companies blame lack of interest from customers for their lack of innovation, the report said.

The report also said the UK had well above average results for science and engineering graduates and lifelong learning, but said its worst performance was for the share of firms that receive public funding for innovation (around half the EU average).

It said the UK performs well above the EU average for IT expenditures and employment in high-technology services, and is strong in broadband penetration.

But, it also said: "The UK performs in eighth place for innovation governance. This is entirely due to a low score for e-government."