1. A STRONG RESEARCH BASE
A strong research base is at the heart of our ambitions as a Government - with independence we will be better placed to support a further strengthening and enhancement of our world-class research base
1. Higher education research in Scotland is internationally recognised and respected for its quality and its innovative and collaborative nature. Researchers in Scotland have a strong track record of competing successfully for funding nationally and internationally attracting £969 million of research investment in 2012/13  from a range of sources reflecting the excellence of our universities and the high quality of their research. In 2012, Scotland's Higher Education Research and Development ( HERD) expenditure as a percentage of GDP ranked top of the 12 countries and regions of the UK and was fourth highest among the Organisation for Economic Co-operation and Development countries  .
Investing in Excellence
2. Scotland's universities are renowned for their excellence and continually punch above their weight internationally. In the latest Times Higher Education ( THE) World University Rankings  five of our universities feature in the Top 200, reinforcing the success of Scotland's universities highlighted in the 2013/14 QS university rankings  that ranked the University of Edinburgh 17th in the world and which showed improved standings in the top 150 for the universities of Glasgow, St Andrews and Aberdeen.
3. Moreover, when adjusted for population, Scotland has more universities in the Times Top 200 world universities per head of population than any other country  (see Figure 1). This achievement is particularly impressive given the increasing global competition our universities have faced from the Asia-Pacific countries including China, Singapore, the Republic of Korea and Taiwan - all of whom have seen their top universities climbing up the world rankings in recent years as a result of significant public investment and interest in higher education.
4. Scotland's universities similarly excel when it comes to citations. Scotland's research is cited by other researchers around the world more often than any other country in comparison to its GDP and Scotland ranks third in the world (after Switzerland and the Netherlands), ahead of all the G8 countries in terms of citations per researcher  .
Figure 1: Number of universities in the THE World Universities Top 200 adjusted for population 
5. But rankings and citations are not the only measure of excellence. In 2012/13, the latest year for which published figures are available, Scottish higher education institutions ( HEIs) won £231 million in Research Council funding  funded through the Scottish and UK tax base accounting for 15.7% of the £1.5 billion Research Council grant and contract funding awarded to UK HEIs on a competitive basis reflecting the high quality of their research. If we look at the overall spend by UK Research Councils in Scotland, then data provided by the Research Councils UK ( RCUK) indicates that Scottish HEIs received 13.1% of the £2.0 billion of research funding to UK HEIs in 2012/13 for grants, studentships and fellowships, while overall, Scotland secured 10.7% of the £2.9 billion total Research Council spending in 2012/13 - just slightly greater than our (8.3%) population share and 9.1% contribution to UK tax revenues (see Chapter 3).
6. The high esteem in which Scottish universities and their research is held is further evidenced by the significant investment the sector secures from charities for research (amounting to £127 million in 2012/13  ). For example, Cancer Research UK has established three Centres of Excellence in Scotland in Dundee, Edinburgh and Glasgow. The Centres are partnerships working at a local level with universities, NHS Boards, cancer networks and other charities, and at a national level with government and industry. These Centres of Excellence will deliver world-class research, improved patient care and greater local engagement while making a significant impact in the global fight against cancer. Other charitable investments include the Edinburgh Centre for Cardiovascular Science (funded by the British Heart Foundation) and the Centre for Cell Biology Edinburgh (funded by the Wellcome Trust).
Dundee Cancer Centre ( DCC) provides a hub to facilitate collaboration and communication of cancer-related activities funded by Cancer Research (CR-UK) and others across the University of Dundee, NHS Tayside and partner organisations.
Through targeted support for training and translational research, the DCC harnesses world-leading cancer research and clinical practice, promotes health equity, and supports more rapid transformation of research outcomes into the prevention, diagnosis and treatment of cancer for the local community and beyond, both nationally and internationally.
In the coming five years the Dundee Cancer Centre aims to:
- establish itself as a hub and build collaborations across all cancer-focused activities in the University of Dundee, NHS, CR-UK and other partner organisations in Tayside and beyond, both nationally and internationally
- contribute to advancing translational research in Dundee and to promoting national and international collaboration
- support clinical trials and the activities of the joint Dundee-Edinburgh Experimental Cancer Medicine Centre (ECMC)
- enhance cancer research-related training and development in Dundee
- expand cancer-focused public engagement activities through science and health engagement programmes and work with local supporters, contributing to CR-UK, NHS and university strategies.
Investing in Impact
7. Excellence however is not an end in itself. Universities are embedded in the fabric of our society and economy, routinely translating their world-class research into tangible economic and social benefits for Scotland and supporting sustainable economic growth.
8. For example, universities are at the heart of the innovation system in Scotland being the primary source for ground-breaking innovations and often the key avenue through which longer-term more speculative research can be undertaken. Through their research activity, Scottish universities make an important contribution to Scotland's overall innovation performance - a key driver of productivity - and, in turn, to sustainable economic growth. Even relatively small improvements in productivity can have significant impacts on economic performance. Indeed Scottish Government analysis estimates that boosting labour productivity in Scotland by just 1% could raise employment by over 21,000 over the long term (around 20 years)  .
9. The EU has identified 'an open and excellent attractive research system' as one of the key drivers of innovation and this can be seen in the success of Scotland's universities in the commercialisation of their world-leading research. According to a recent survey by PraxisUnico  , Scotland is the most successful part of the UK in creating new spin out companies accounting for 20% of new spin-outs created in the UK over the past decade and 26% in 2012 alone, with five Scottish universities (Edinburgh, Aberdeen, Glasgow, Strathclyde, and Heriot-Watt) featuring in the top ten universities most active in the creation of spin-outs in the past three years (2010-12).
Figure 2: Proportion of University Spin-out Companies by Region 2000-02 to 2010/11
10. Scotland also leads the UK in securing successful exits for its spin-out companies through trade sale or flotation. Over the ten years (2003-12), 21% of all successful exits have been spin-out companies from universities in Scotland compared to 19% from universities in London and 18% from universities in the South East.
Optoscribe is a spin-out from Heriot Watt University in Edinburgh specialising in ultrafast laser inscription technologies for photonic device manufacturing. Based in Livingston, Optoscribe develops and manufactures 3D waveguide based and micro-machined photonic devices for communications and novel sensor applications.
Optoscribe has joined the European Commission's MIRAGE project on next generation optical interconnects for Datacenter applications. The three-year research programme aims to develop breakthrough photonic integration technology enabling terabit capacities in optical interconnect links. Its consortium brings together seven partners from across the value chain comprising university research centres and leading companies from several European countries  .
11. Scotland's universities also contribute more widely to the Scottish economy, with a recent report, Grow, Export, Attract, Support  published by Universities Scotland in September 2013 estimating that, in 2012/13, universities contributed £6.7 billion gross value added ( GVA) to the Scottish economy and supported 142,000 jobs. Research activity is a key contributor to this economic benefit with research and knowledge exchange estimated, in the report, to account for over a quarter of university exports internationally and recognised as a key factor in attracting foreign investment.
12. University research also has a wider range of societal benefits. For example, a recent clinical trial involving researchers at the University of Glasgow and surgeons at the Golden Jubilee Hospital, one of the UK's leading 'heart attack centres', demonstrated that heart attack patients have a much better outcome if other narrowed arteries are stented at the same time as the one that triggered the attack. This 'preventive angioplasty' has already provided significant benefits both for the individual patients who have been treated and in contributing towards a reduction in the longer term cost of their healthcare. There are potential significant reductions in the cost of healthcare if this approach is more widely adopted.
13. Elsewhere, collaborative academic and practitioner research undertaken by the Scottish Institute for Policing Research ( SIPR) has supported the development of violence reduction strategies, public order policing strategies including community policing and the creation of safer neighbourhoods and the creation of an evidence base of community safety interventions for use by the Scottish Community Safety Network (SCSN).
A Supportive Government
"The news about our research funding figures, and our continued rise in the various world league tables, is very welcome and reflects the quality, hard work and dedication of our staff and students, as well as the highly strategic support we receive from the Scottish Government. With such support, the university can go on producing world-leading research which has the potential to change people's lives for the better." Professor Sir Timothy O'Shea, Principal of Edinburgh University, Herald, 10 September 2013.
14. The Scottish Government recognises the contribution our universities and their research base make to Scotland's society and economy. That is why this Government is investing, through the Scottish Funding Council ( SFC), £364 million in research and knowledge exchange in 2013/14, an increase of 11% on the previous year and a rise of 38% (£100 million) since 2007  . The main element of this funding is the Research Excellence Grantamounting to £242 million in 2013/14 to support the research base in Scottish universities ensuring it is maintained, sustained and remains globally competitive and attractive to the best researchers.
15. The Global Excellence Initiative, launched in May 2013, provides an additional investment of £13.8 million to help further boost Scottish output of world-leading research and the international reputation and standing of our universities. Shared between Scottish universities on the basis of current research rated 4* (world-leading), this investment is being match funded by the universities (in receipt of greater than £0.5 million) and used to support research excellence in a range of ways. For example, the University of Edinburgh are using the funding provided under the Global Excellence Initiative to recruit around 120 Chancellors Fellows (early career academics) and around 40 (per annum) 4 year PhD studentships to support strategic developments in research that will further boost the university's research profile.
16. While funding is clearly important, the Scottish Government's support for research is about much more than the allocation of monies. It is about creating an environment where research is respected and valued and where government, businesses and universities work in partnership to grow our economy and improve our society.
Respect for Autonomy
17. Scotland's higher education sector is one of the most autonomous in the world according to the European University Association ( EUA) Autonomy Scorecard  . We have recognised the clear benefits of responsible autonomy in supporting innovation, competitiveness and fleetness of foot across the sector and been clear that this remains the bedrock for our future success. In particular, in relation to research, we have supported the Haldane Principle, that researchers - not politicians - are best placed to make decisions on what research gets funded. This will remain a central principle of our approach with independence along with our continuing commitment to fundamental research that underpins successful innovation.
18. The effective circulation and exchange of knowledge is fundamental to securing maximum benefits from our world-class research. Scotland has a long and proud tradition of leading new and innovative approaches to research and to collaborations with industry but with independence we could do more. Innovative economies are more resilient and adaptable to change and, with independence, future Scottish Governments would have additional financial levers to support and encourage innovation and research investment (see Chapter 4 for further details).
19. In recent years, within our existing powers, we have worked closely with the SFC and our universities to take forward a number of successful, innovative initiatives which have helped our institutions to continue to punch above their weight internationally and to ensure that our research base supports our ambitions for growth.
20. Over the last decade, for example, the Scottish Government has invested £156 million  in research pools, which has attracted another £360 million from the universities and their business partners. This collaborative approach has gained much domestic and international attention, attracting leading international researchers and postgraduate students to Scotland and providing the basis for further significant developments in research and interactions with business and industry.
21. A study commissioned by the British Council found that "Scottish research pools constitute an innovative approach to research collaboration that leverages excellence to concentrate activity and stimulate collaboration between universities (both domestically and internationally)"  .
Established in 2007, the Scottish Universities Life Sciences Alliance ( SULSA) is a research pooling partnership among the Universities of Aberdeen, Dundee, Edinburgh, Glasgow, St Andrews and Strathclyde and is supported by the SFC. SULSA aims to maintain and advance Scotland's global position in Life Sciences by recruiting international research leaders and funding world-class research facilities.
The research excellence within SULSA was instrumental in helping Scotland secure a central role in the European Commission's Innovative Medicines Initiative programme aimed at discovering new drugs. A state-of-the-art drug screening facility, supported by global pharmaceutical companies, the European Lead Factory (ELF) is being established at the BioCity Scotland site at Newhouse.
The ELF facility will provide researchers from SULSA, from SMEs and patient organisations across Europe an unprecedented opportunity to advance medical research and develop new medicines.
22. We are also investing, through SFC, £124 million over six years in a network of Innovation Centres. Developed in partnership with Scottish Enterprise and Highlands and Islands Enterprise, Innovation Centres ( ICs) are collaborations between universities, businesses and others to enhance innovation in and across Scotland's key economic sectors. Widely recognised by the sector as game changers, these centres have the potential to transform the scale and nature of university-business relationships and collaboration, further enhancing sustainable economic growth.
Innovation Centres: Aims and Objectives
- to offer collaborative knowledge exchange and research activities to help solve industry defined problems and co-create innovative opportunities for growth;
- to enhance two way knowledge exchange between universities, industry and others towards realising tangible benefits for businesses while also stimulating and challenging the Scottish research base;
- to provide an environment that supports the development of the next generation of business innovators, academics and entrepreneurs in Scotland and a culture change towards greater and more effective university/industry collaboration;
- to simplify the innovation landscape in Scotland through creating conduits to university knowledge and expertise for all businesses in Scotland and being complementary to and exploiting existing initiatives such as Interface and Innovation Scotland.
23. The first three innovation centres: the Stratified Medicine Innovation Centre; the Sensors and Imaging Systems Innovation Centre; and the Digital Health Institute were officially launched by the First Minister in April 2013. Backed by £30 million of public funding, the centres - supported by the Scottish Funding Council - will concentrate on developing world-leading Scottish technology and life sciences. The three centres will ensure that Scotland continues to be a pioneer in life sciences, innovative technology, ideas and development and will create more than 2,000 jobs in their first five years.
24. Speaking at the launch of the first three innovation centres, Chair of the Digital Health Institute, Professor George Crooks OBE, said "We have ambitious plans to revolutionise the health service efficiencies in Scotland and at the same time improve patient experiences, as well as nurturing and inspiring our entrepreneurs to rise to the challenge and ensure Scotland remains at the forefront of the sector"  .
The Stratified Medicine Scotland Innovation Centre (SMS-IC) will be located at the new Learning and Teaching facility on the South Glasgow Hospital campus and is a partnership involving Health Science Scotland (the combined Scottish Medical Schools) and industry, including both local SMEs and major global companies.
Stratified medicine involves examining the genetic makeup of patients and their differing responses to drugs designed to treat specific diseases. By building up an understanding of the 'strata' of responses and the genetics of the diseases, medical researchers hope to create more personalised and effective forms of treatment. As well as the medical benefits, there is a clear economic argument for the development of stratified medicine. Of the £595 billion global spend for pharmaceuticals in 2011, an estimated £393 billion was used for therapies which did not produce the desired effect.
The SMS-IC will focus primarily on developing new forms of treatment for chronic diseases, including cancer, stroke, diabetes, rheumatoid arthritis and respiratory and cardiovascular diseases.
Speaking at the launch event at the South Glasgow Hospital Campus, David Sibbald, Chairman and CEO of Aridhia - the company providing the biomedical informatics platform and expertise for the Centre said:
"The Stratified Medicine Scotland Innovation Centre is a globally significant program to determine the future of healthcare in the 21st century … By combining our expertise with that of our academic, clinical and commercial partners, the SMS-IC will support the creation of new knowledge to inform the delivery of quality health care across the world and create economic growth for Scotland." 
25. A fourth Innovation Centre - Industrial Biotechnology - was launched in February 2014 and a further four centres covering Aquaculture, Construction, Data Lab (Big Data) and Oil and Gas will be launched later this year.
26. Alongside these large-scale ambitious projects of excellence, the Scottish Government is leading wider efforts to strengthen business and university collaboration and embed innovation and creativity at the heart of our businesses. For example, in October 2013 we launched Innovation Scotland, a new knowledge exchange initiative - a shared strategy to improve the effectiveness of support for business growth.
27. Innovation Scotland will focus the efforts of SFC, the universities, the enterprise agencies and government on improving and simplifying the experience of Scottish businesses who work with Scotland's universities to develop and exploit innovative ideas through a number of interventions including creation of a National Policy Forum; extension of the role of the SFC-funded matchmaking service 'Interface' (which provides a central hub connecting businesses from a wide variety of national and international industries to Scotland's higher education and research institutes) and the provision of bespoke sectoral knowledge exchange resources.
28. Initiatives such as these typify the advantages of a small country in facilitating connectivity across boundaries - in this case supporting joint working between universities, business and the public sector. They also highlight the ability of the research base to respond quickly and flexibly to harness new opportunities. Such agility and adaptability is critical in competing successfully in a rapidly changing world and will ensure Scotland's universities retain a competitive edge globally, continuing to attract inward investment to Scotland.
29. However, there remains scope for further progress and independence provides the opportunity to build on our existing successes to increase the ways in which research is transferred into economic growth and into the development of the social fabric of the country. By providing a clear focus on the strengths and requirements of the Scottish economy, business and academia, independence has the potential to further strengthen the environment for innovation and offers an opportunity to develop a more coherent framework for innovation in Scotland enabling the full range of economic levers - including taxation, public investment and economic regulation -
to be utilised in a more co-ordinated and joined-up way. This coherent approach, combined with strong partnerships between our universities and businesses, will be critical to develop new and innovative approaches to research which will support our key industries and play a strong role in our future success as a nation  .