Background to the report

The government considers research and innovation (R&I) and the diffusion of new technologies to be vital to the UK’s future and to achieving its major long‑term and complex policy goals, including its mission to grow the UK economy and achieve net zero.

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UK Research and Innovation (UKRI) is the UK’s largest single public funder of R&I, with a budget of £9.6 billion in 2023-24. Examples of projects approved by UKRI include funding for very early‑stage research in microbial fuel cells and hydrogen purification; and the development of bone stem cell and biomaterial technology to reduce infection rates and the cost of hip repairs.

Government investment in R&I generally aims to support creating, applying and delivering value from new knowledge and ideas.

However, there are many unique elements that make assessing and achieving value for money challenging. New ideas will not have any track record of achievement or delivery, outcomes of innovation carry a higher degree of uncertainty, and many projects will potentially lead to different discoveries or may fail altogether.

Scope of the report

This report looks at the extent to which UKRI has considered the principles and conditions for effective support for R&I and applied those principles in practice. It focuses on competitive grant funding, covering:

  • how well the government understands public sector requirements for R&I including UKRI’s role in supporting and funding it
  • UKRI’s effectiveness in using grant funding to harness innovation and opportunity
  • the extent to which UKRI is learning and developing its understanding of how best to support innovation and influencing government’s overall approach

The report does not seek to examine the overall effectiveness of UKRI as an organisation.

Conclusions

The government considers that investing in the UK’s R&I system is vital for achieving its long-term policy goals, including its mission to grow the UK economy, and achieve net zero. UKRI is the largest single public funder of R&I in the UK, spending around £9 billion annually.

Providing effective support for R&I that secures value from public sector investment is a complex challenge: new ideas will not have a track record of achievement or delivery, outcomes of innovation carry a higher degree of uncertainty, and many projects will potentially lead to different discoveries or may fail altogether.

UKRI and its predecessor bodies have helped support a globally respected R&I system, which has demonstrated that it can respond effectively to emerging challenges such as to the COVID-19 pandemic. UKRI, together with DSIT, is seeking to continually improve by researching the best way to fund R&I.

However, there is still more that UKRI could do to maximise the value for money it secures from supporting R&I. In particular, DSIT and UKRI need to define more clearly the overarching desired outcomes from its R&I spending, and UKRI needs better data to be able to identify where its resources are being spent and support decision making.

UKRI must also be clearer on how decisions taken in the grant funding lifecycle influence how ambitious it is in its grant funding decisions and continue to work to ensure its culture supports well-managed risk taking.

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Publication details

Press release

View press release (14 May 2025)

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