Time to save the current crop

We are, of course, in favour of recognising science as a force for reversing the downward trajectory our economies are stuck in – and of the various passed and proposed stimulus packages.

But where and how to apply this stimulus? Is the aim of these packages to maintain employment in a recession by funding basic research? Or is it to create jobs by supporting the formation of technology spin-outs? Maybe the aim, as in the US, should be to foster the emergence of the sectors of tomorrow in cleantech and alternative energy. Or perhaps the packages are intended to lead old-fashioned industries, stuck in their industrial-age roots (such as automobiles and construction), into a leaner, greener, more competitive and sustainable future, as in the new Framework Programme 7 projects announced last week.

It's fair enough to talk of golden eggs, and to argue that public research budgets shouldn't be cut. But given the length of time it takes for this research to produce economic benefits, it is right to ask whether this is the point in the chain to deploy increasingly scare resources. With the best will – and greatest urgency – in the world, it takes time to shape programmes, invite proposals, sift and referee grant applications and, finally, get down to work.

So although launched as an emergency package to aid hard-pressed sectors, it will take until January 2010 before the three FP7 projects announced next week get underway. Similarly, the US National Institutes of Health recognises that preparations are needed to turn on the grant-giving taps in a focused way.

There is a view in the UK that, given these time-lags, it would be more appropriate to direct the science stimulus expected in this month's budget to increasing financial support for the formation of spin-outs. This would create new jobs, build new markets, and lay foundations for future economic growth.

Which leads us to existing development stage technology companies and how they are faring in this recession. The answer, to be blunt, is badly. To take one illustration: in a survey of 285 life sciences companies, published last week by the UK BioIndustry Association, 78 per cent said it had become harder to raise money in last 12 months. Indeed, 47 per cent tried, and failed, to do so. Surveys of French and Norwegian companies in the sector show they are facing same problem.

So yes, basic research budgets should be protected and enhanced, and spin-out companies need seed funding.

But if the objective is economic revival – and given that stimulus money is in short supply – surely the most important thing now is to preserve the science-based companies that already exist?

This down-trodden band is not facing extinction because their technology is no good (that in most cases is yet to be proven). Rather it is the oxygen-sapping combination of risk aversion and frozen capital markets.

And there seems to be little point in funding research or spinning out new companies in response to the economic crisis if we aren't going to help the science-based companies we have now.