Financial aid will breathe new life into innovation

Picture: Getty
Picture: Getty
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The Scottish Government has a bold mission – to double the economic contribution of life sciences to Scotland by 2020.

It is right that we should be bold about future opportunities for the sector. We have the talent and the infrastructure to make this happen. Scotland’s universities are renowned worldwide for their research and innovation. Spin outs from our universities are on a steep upward trend, as opposed to the rest of the UK.

Unfortunately however, increased start up and spin out activity does not necessarily translate into future economic contribution and employment. Most start-ups and spin outs will not make it to market, and the majority of those which do will face significant challenges along the way.

Success in tech means turning an intellectual spark into something commercially viable. Government can help by providing more opportunities for viable companies to get to that stage. Productive collaboration between academia and business is vital to provide strong platforms for future success.

Government support

Strong government support is vital to achieve the 2020 goal. Will independence be a factor? We’ll know soon enough. Meantime, there are opportunities now that would further incentivise research and development and business investment from the private sector through specific extension in schemes such as the Seed Enterprise Investment Scheme (SEIS), Patent Box legislation and R&D credits relief to help smaller and start-up companies which may not currently qualify.

Modest tweaks could make a huge difference. For example, SEIS (which offers tax incentives for investors) is only available where a company has been around for less than two years, but some life sciences companies can take twice that to become investment ready. A small change to time scales could make a significant difference.

There is an argument that such support defers, in the short term, the natural demise of businesses that would (and perhaps should) otherwise fail. However, you have to speculate to accumulate, and life sciences is a sector we should all have confidence in. We just need to get all of the pieces of the jigsaw in place to give it a long term business future.

• Mike Harkness is director at Scott-Moncrieff business advisers and accountants

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