Changes to the way in which the government funds research and development means that construction now has to compete with the rest of UK industry for the DTI's money. The prospects are not good …
It would be funny if it wasn't so frustrating.

Among the government's strategic policy objectives is one to reduce greenhouse gas emissions and another to increase housing supply by means of high-tech prefabrication. Both of these objectives require the research and development of new building materials and systems. Yet both will be thwarted by a virtual end of state funding for R&D in the construction sector. In other words, the government resembles a one-legged man determinedly kicking away his own crutch.

Four years ago, there were 115 new research programmes part-funded by the government, looking at everything from climate change to the behaviour of timber-framed buildings in a fire. Now there are none. Instead of a dedicated share of the government's research funding, construction has to fight against some of the most dynamic manufacturing sectors for its slice of the pie. Early reports are not encouraging. "Out of the first £50m of research funding, I wouldn't be surprised if construction didn't get any," says Andrew Cripps, research co-ordinator at Buro Happold.

Without a steady stream of research feeding the industry's innovators, the rate of advance in construction products and process will grind to a halt. "This looks like leading to a major crisis in construction," says Turlogh O'Brien, chairman of the Construction Industry Council and deputy chairman of Arup.

The dreaded DTI: Funding obstacles The crisis in R&D is due to major changes in the way research is funded. Until recently, a fundamental plank has been the Partners in Innovation programme (PiI). This provided up to half the costs of construction research projects. The scheme typically provided £7m of funding each year. However, it ceased to be a source of funding for construction research in September 2002, soon after government responsibility for industry moved from the Department of Environment, Transport and the Regions to the DTI.

Existing projects with funding will continue until they are complete. However, no new PiI programmes were commenced last year. O'Brien points out that the impact of this will not be felt instantly; instead the industry faces a slow decline in innovation over several years. "Because of the nature of research there will not be any short-term impact," he says. "But, a few years down the line, the industry's technical knowledge will start to wither."

The root of the problem is the way the DTI funds research. "Under the DTI innovation review, the department looked at all the different sector schemes that it had running and decided to close them all down and make sectors collaborate on R&D – so there is no ring-fenced money for construction," says Terry Boniface, the DTI's PiI project manager. "Now the DTI is looking for bigger projects to fund under the collaborative R&D programme – unlike the PiI programme, which funded incremental projects," he adds.

Under the PiI funding system, the average amount of funding for a construction project was in the region of £70,000. At the DTI, the process is different: it looks to channel funding of up to £1m into a few projects that have the potential to have a large impact on an industry. "The DTI likes large-scale collaborative research projects which result in a step change in an industry," explains O'Brien.

In theory this should be good for construction. The DTI's way of making substantial funds available for research could fund some major studies. "There are big chunks of money available under these programmes so now construction has the opportunity to apply for megabucks," says O'Brien.

The problem is the funding is allocated to a wide range of research topics, many of which are not related to construction. The first project for which funding was available this year was nanotechnology – the science of manipulating molecules. At the moment, the DTI is calling for applications for funding for seven projects. O'Brien says the only topic to affect construction is advanced composite materials and structures.

On a more cynical level, Professor Farshad Alamdari, chief scientist at the BRE, suggests that construction would struggle to gain funding for its research since the DTI's research topics were chosen "to appease some of the big multinational companies to stop them moving research abroad". "The DTI's funding is very much geared up to satisfying the likes of firms like aero-engine manufacturer Rolls-Royce," says Alamdari. "Such firms are interested in blue-sky research whereas construction research is about incremental improvements in product and process," he adds.

There are plans to change the DTI decision-making process on research topics. "We are hoping to set up a technology strategy board to decide what research needs funding," explains Boniface. He says the board will be made up of "two investment bankers and a cross-section of the great and the good of industry". Boniface says the board will be "up and running by autumn" and will be the place that construction will have to go cap in hand to for research funding. "At the end of the day construction's influence on where funding is allocated will not be as direct," says Boniface. The DTI will announce calls for applications each April and October.

Our own worst enemy
The DTI expect the competition for research funding to be intense. "If construction is going to secure funding it is going to have to put in much stronger proposals," says Boniface.

But according to O'Brien, the DTI's policy of funding projects only if they are likely to make a step change in an industry works against construction. "If you are a business that makes things it is easy to put together a bid for research to make a significant difference, but construction pulls together technologies, so there is not much scope for a step change," he says.

Another problem is the fragmented structure of the industry compared with rival sectors, such as aerospace. The government looks for the industries that it supports to match its funding, which is easier to organise in industries that have fewer, and larger, players. O'Brien says: "The problem is that the nature of the construction industry makes it difficult to put together an industry cross-section to form a research team."

Michael Dickson, chairman of consultant Buro Happold, would disagree. As chief executive of industry- and government-funded research organisation the Construction Research and Innovation Strategy Panel (CRISP) he has spent the past two years revamping the organisation. Dickson is optimistic that nCRISP (the "n" stands for new) will bring success to bids for research funding, saying it will act as a "conduit for industry to decide on its priorities".

However, once the industry has decided on its research priorities, it will still have to get the DTI's technology strategy board to buy into construction's priorities ahead of those of other industries. Dickson says the next step in the transformation of nCRISP will be for him to be replaced by "a big hitter", probably the chief executive of a contractor. "Once we've got a big hitter we should be able to get the bigger construction firms to take strategic research seriously," he says.

RTOs: endangered species
One of Dickson's challenges is to get government departments to recognise the importance of industry research and technology organisations (RTOs), such as the Steel Construction Institute and the Concrete Institute. RTOs represent one of the best devices to bring industry priorities together. Dickson's concern is that, without government money, "these bodies will struggle to survive". The DTI admits that industry RTOs will struggle for funding. "It may be more difficult for them," says Boniface.

The long-term existence of the BRE as an independent research organisation has also been put in danger. "It is a substantial financial loss to the BRE," says Alamdari. "The BRE sponsors one third of all construction PhD students - if government policies destroy the organisation their funding will be jeopardised," he adds.

He says the BRE may have to change drastically to survive. "We will have to become a consultant organisation rather than remain a national research laboratory or alternatively we will have to partner with universities for research funding from the Engineering Physical Sciences Research Council," says Alamdari.

O'Brien says from Arup's perspective the lack of research funding will not be significant. However, with his CIC hat on, he is "very concerned about the potential weakening of the industry's technical knowledge". He says that this could soon start to have an impact on UK construction. "The weaker our home base becomes, the weaker our export potential" he warns.

Construction might rue the day it moved to the DTI. "We've lost out. If construction was still at the DETR there would have been no reason to change the way research was funded," says O'Brien.

Alamdari agrees with O'Brien: "In five to 10 years' time construction innovation will go in the wrong direction - it is a sad, sad situation."

  • For information on DTI schemes that support company and collaborative R&D, see or