CBI urging support for R&D

SPENDING ON research and development by Scotland’s businesses dropped in the aftermath of the recession.

Official figures show that £622m was spent on R&D in Scotland in 2010, a real terms drop of £25m on the year previous and just 3.9% of the overall UK for the period.

CBI Scotland’s assistant director David Lonsdale said R&D had to be supported as innovation played a vital role.

He said: “More can and ought to be done to spur commercial innovation, which is why the Scottish Government should better promote the R&D support and grants on offer, incentivise more young people to study maths and science, and reform public procurement to make it a more effective purchaser of innovative services.” The UK’S economy shrank by more than previously thought in the final quarter of last year, official figures revealed yesterday.

Gross domestic product declined by 0.3%, the Off ice for National Statistics ( ONS) said, revised down from previous estimates of 0.2%.

The ONS said that there had been a slight decline in the powerhouse services sector, initially thought to have been flat, while household spending was also worse than previously thought.

The third and f inal estimate from the ONS means the UK economy entered this year in a worse position than previously thought.

However, most economists think the UK will avoid another recession — defined as two quarters of back-to-back contraction — by returning to growth in the first quarter of the year after stronger industry data in recent months.

The economy is still expected to remain sluggish and lacklustre for the first half of the year at least, as households continue to be squeezed by rising unemployment and as pay fails to keep pace with the rising cost of living.

The UK’S overall growth for 2011 as a whole was revised down to just 0.7%, having previously been thought to be 0.8%, and way below long- term growth trends.

The G ove r n m e n t ’s independent watchdog, the Off ice for Budget Responsibility, estimates growth of 0.8% this year.

H owa r d A r c h e r, economist at IHS Global Insight, said: “Attention is now firmly focused on whether the economy has returned to growth in the first quarter — and, if it has, can it build on this in still difficult conditions?”