Questions have raised over the future of Innovate UK after its search for a permanent leader entered its second year.

Speculation over Britain’s innovation research funder is also mounting as the Department for Science and Innovation (DSIT) has yet to announce the overall budget for UK Research and Innovation (UKRI) in 2025-26 with just two months until the start of the financial year. In 2024-25, Innovate UK was allocated .

That delay has raised concerns that UKRI’s research councils are facing significant cuts in light of chancellor Rachel Reeves’ call for departments to find “efficiency savings” of at least 5 per cent ahead of her June spending review.

But the lengthy search for a long-term successor to Indro Mukerjee, who announced in January 2024 that he would be stepping down as Innovate UK’s executive chair in September, has prompted speculation that more radical changes are underway at the body.

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In August, Labour  – which was previously launched by the Conservatives in April – yet no news has emerged about takers for the £180,000-a-year post despite job interviews having been .

“Encouraging economic growth is Labour’s number one priority so it seems strange that they haven’t appointed anyone to what should be a key role for this mission,” one source told ����Vlog.

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“Not having a permanent chair at Innovate isn’t great for UK research – the government is talking a lot about industrial strategy and innovation but I’m not hearing much said about Catapult centres [funded by Innovate UK] or any of Innovate’s funding. These should really be part of the pro-growth conversation.”

Any delay in naming an Innovate UK executive chair was “much less understandable” than withholding the name of Ottoline Leyser’s successor given the UKRI chief has always intended to stay until this summer, they continued.

John Womersley, former executive chair at the Science and Technology Facilities Council, said he believed the delay in appointing a permanent chief executive “relates to the rumours that have been circulating about [science minister] Patrick Vallance considering separating Innovate UK out of UKRI. “

“This may mean that the person profile for the CEO may need to be different, or that the Innovate appointment may be waiting for the identification of the UKRI CEO who might be expected to have an opinion on whether Innovate should be part of UKRI or not,” said Wormersley.

“Some people have suggested that a decision in principle to separate Innovate has already been made, but the delay might imply that this is still an open issue.”

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Other believe a more radical shake-up of Innovate UK’s functions could be on the cards, with funding perhaps being handed directly to flagship Catapult centres – such as the Advanced Manufacturing Research Centre (AMRC), which is partly run by the University of Sheffield.

Diverting some of Innovate UK’s funding from small businesses to academic research could prove a useful way to demonstrate a commitment to flagship universities in the regions, which may soon be asked to play a bigger role in regional innovation and economic growth agendas, said John Yates, former head of external affairs at the AMRC.

“If the government is rethinking the role of Innovate, and it should do as part of a radical overhaul of the Catapult network, there will be pressure in the other direction from the university lobby to use Innovate UK funding to bridge the shortfalls in their research budgets, previously filled by high fee-paying overseas students,” he said.

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However, Yates argued that “too much of [the discussion on Innovate funding] is happening behind closed doors”.

“We need a much more open, cross-party debate about how best to stimulate innovation-led growth in the UK’s underperforming regions. Chi Onwurah’s [House of Commons] Science, Innovation and Technology Committee is asking many of the right questions, especially on devolution, funding and links between the private sector, university research and combined mayoral authorities,” he said.

“But the government needs to take ownership of R&D funding reform as a matter of urgency, rather than allow universities and other research organisations to drift from financial crisis to financial crisis in a sector critical to regional economic growth.”

A DSIT spokesperson said the process of the process of appointing a new executive chair was “ongoing” and updates would be provided when possible, pointing also to interim chair Stella Peace’s “wealth of experienced leadership”.

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jack.grove@timeshighereducation.com