The recent failure of three of Iceland’s largest banks has prompted a UK local government to delay by one month plans to partially fund development of the £13.5 million ($23.5 million) Genome Analysis Centre at Norwich Research Park.
The delay will have no affect on the center, according to a council official.
The Norfolk County Council last week postponed to November its plan to award a £1 million grant toward the center — which would be the first of its kind in the UK — after it learned how much of a £32.5 million investment in three failed Icelandic banks it will lose.
Iceland’s troubles, and the UK council’s response to them, will not derail the genomic center project, according to the county council’s leader.
“There isn't an impact on the project as the deadline [for going ahead with development is] early next year,” Daniel Cox, leader of the council, told BRN via e-mail.
Cox, a Conservative party member representing Wymondham Division, said the council’s caution reflects concern about the potential for disruption in the county’s finances.
“If we have lost all the £32.5 [million], which now seems highly unlikely, we would have to revisit our entire capital program,” Cox said.
Norfolk County is among 116 UK public agencies that have a combined £858.3 million frozen in three banks seized by Iceland's financial regulatory agency earlier this month — £15 million in Landsbanki Islands, £10 million in Kaupthing Singer and Frielander, and £7.5 million in Glitnir Bank.
The banks collapsed after being unable to secure short-term funding, which in turn touched off the collapse of Iceland’s krona. The result has caused international trading in the currency to be frozen.
Icelandic officials are in talks with the Russian government to stabilize the currency, while the nation’s central bank, Sedlabanski, last week scrambled to prop up the nation’s economy by lowering its key interest.
Norfolk County Council’s £1 million would be paid out at £500,000 a year over two years, starting in the 2009-10 fiscal year. Cox said the money would be paid in several installments starting with one of £250,000. Money for the grant would come from the county council’s £4.8m in unallocated funds for 2009-10, and from unallocated funds in 2010-11.
It’s too early to say what the council should do if the Icelandic bank crisis is not resolved, Brian Iles, the county council cabinet member who oversees economic development, told BRN.
“We're hopeful of an early resolution to the Iceland issue, which will then enable us to decide on the best way to respond,” Iles, a Conservative party member representing Acle, said last week via e-mail.
The Genome Analysis Centre would occupy space within the research park’s Genome Center building, completed in 2002. The space was originally occupied by UK-Swiss agrochemical company Syngenta, until it withdrew from a £50 million alliance with the John Innes Centre, a plant science and microbiology center based at Norwich Research Park, as part of a reorganization. The GAC would focus on analysis of plant, microbial, fish, and farm animal genomes.
“The outputs or ‘products’ of the Centre would be information that may be used in a wide variety of applications including traditional crop and livestock breeding, analysis of biodiversity, and, for example, in identifying varieties of plants that are more resistant to disease or suitable for organic production, as well as potential application in plant biotechnology including [genetic modification],” according to a project description furnished by the Biotechnology and Biological Sciences Research Council. The council is the UK’s top funding agency for academic research, akin to the National Institutes of Health in the US, and a key proponent of the project.
The GAC will employ about 60 “specialist-scientists and technologists,” have about 20 additional visiting workers at any given time, and train 12 PhD students annually,” according to an Oct. 13 report prepared by Iles for the county council cabinet. “The Genome Analysis Centre has the potential to be a unique resource for the UK, and probably the whole of Europe.”
The UK has been one of the world’s top locations for genomics, with the Wellcome Trust Sanger Institute and European Bioinformatics Institute both based at Sanger’s Hinxton campus near Cambridge.
“The other organizations involved in this are large enough to be able to cope with the Norfolk County Council being late with a payment.”
Last year, the Sanger Institute announced it will refocus its research from genome analysis to what it said were core strengths that include large-scale studies of natural and engineered variation in genome sequences in humans, pathogens, and model organisms. The shift, which reflects a decline in the cost in genome-sequencing technology, also created a gap that the Biotechnology and Biological Sciences Research Council, or BBSRC, and others hope the GAC will fill.
“The reason we have become involved in this area is because there are increasing needs for genome sequencing for organisms in the wider environment, particularly in agriculture and biotechnology,” Alf Game, deputy director of the Science & Technology Group for BBSRC, told BRN in an interview. Sanger will furnish equipment to the new center, he added.
The BBSRC has agreed in principle to underwrite the core operating costs of the GAC — £15 million over five years, according to Iles’ report, a figure that Game would not confirm, pending a formal announcement of the project by his agency expected next month.
As for the Norfolk county council money, Game said: “Although their money is essential to the business plan, it’s something we can work around.
“The other organizations involved in this are large enough to be able to cope with the Norfolk County Council being late with a payment,” Game added. “We’re reasonably content about the way that this is going.”
According to the report, for its first three years the GAC has lined up anticipated funding of about £11.8 million. In addition to about £1.6 million coming during that time from BBSRC, and the £1 million from the county council,
- About £3.5 million would come from the East of England Development Authority, a regional planning agency;
- A combined £1 million would come from the Norwich City, South Norfolk and Greater Norwich Development Partnership, an umbrella that includes the Norwich City Council, South Norfolk Council, Norfolk County Council, and the Broads Authority, which oversees the Norfolk and Suffolk Broads, Britain’s largest protected wetland;
- Another £500,000 would come from the Innes center; and
- Nearly £4 million is expected from “other grants and sponsorship” sources.
That would leave the center with a funding gap of more than £1.5 million, which “is not considered to affect the viability of the overall project,” the Iles report stated.
GAC supporters have promoted the project as much on its economic-development potential as on its science. Iles’ report also cited an earlier study concluding that the center could create between 500 and 750 jobs at Norwich Research Park over a three- to seven-year period as scientists spin out new companies [BRN, Sept. 8]. The center is also projected to generate £5 million in annual revenue.
“Although the GAC will not initially employ large numbers, it is the potential for commercial spin-offs that provides the interest and rationale for us to consider the request we have received to support this project,” the report concluded.
That potential, according to the BBSRC and other project supporters, could add considerably to the 6,500 jobs and 900 postgraduate research sciences students now based at the research park, which is a collaboration between the University of East Anglia, the Norfolk and Norwich University Hospital, and three independent research centers: Innes, the Institute of Food Research, and the Sainsbury Laboratory.
The Norwich City Council said last week, however, it is still considering whether to join Norfolk County in awarding funding for the project.
"The city council recognizes the important contribution that the health and life science sector make to the continued prosperity of the Norwich,” council spokeswoman Amy Lyall told BRN in an e-mail. “Norwich City Council is considering whether to offer funding to the Genome Analysis Centre. Any proposal for funding needs to make its way through the official council process before a decision is made, and this proposal is still doing so.
“The amount we would award and any benefits accruing to the council are yet to be settled," the statement added.
EEDA spokesman Adrian Ient told BRN that the authority has agreed in principle, subject to due diligence, to award the center £1.85 million for the first year, the same amount as the project would receive combined from the BBSRC, the local councils, and the Innes Centre.
Ient added that EEDA has agreed to consider future funding, in tandem with other key stakeholders subject to their own due diligence and political approvals. “However it should be noted that the Regional Development Agencies have all suffered severe capital budget cuts” due to the suspension of the “Stamp Duty” documents tax by the UK national government.
“This impacts on EEDA's ability to fund a range of capital-intensive projects, especially in 2010/11,” Ient said.
Iles’ report said that the EEDA would award the GAC £1.6 million in 2010-11.
EEDA has supported the GAC as an example of the type of project needed to draw more life-sciences companies and their jobs into and around Norwich. Indeed, the EEDA last month released a 158-page regional economic strategy study whose recommendations urged regional officials to “enable the development of clusters at Norwich Research Park and Hethel [Engineering Centre] around globally renowned anchor companies and research institutes in areas of automotive engineering, environment and life sciences.”
The study also urged regional officials to “strengthen Norwich as a leading medium-sized science city in the UK,” and improve the position of University of East Anglia in global university rankings and significantly increase spin-out technology transfer.”
The EEDA regional economic strategy for 2008 through 2031, Inventing Our Future: Collective Action for a Sustainable Economy
, is available here.
“This is a very important project that fits with the objectives laid out in the Regional Economic Strategy,” Ient said of the GAC. However, the EEDA “needs to see a clear contribution to the development of the wider Norfolk economy and the Norwich Research Park in particular beyond the initial 40 jobs … which are being recruited for now.
“The applicants have been asked to address that issue, and their plans for effective commercialisation, comprehensively in their future business case submission(s) for Phase 2 and/or 3 funding,” he added.
Iles’ report said the GAC would be part of a broader effort to promote more tech commercialization in Norwich and East of England in general.
To be sure, the GAC has not been without opposition. Norfolk County councilors allied with the Green Party last week issued a statement questioning the project. The Greens questioned whether the GAC could deliver on its job and economic activity projections, whether citizens support any research that involved genetic modification of food and living organisms, and whether the center could be built closer to where new housing is being built, in order to reduce environmental effects.
“If Norfolk County Council [is] funding this, why [is it] not also funding research into sustainable agriculture, local food supply, organic production, and green jobs in marine/solar/wind sectors which East Anglia is particularly suited to exploit?” Councilor Andrew Boswell asked the council, according to an Oct. 15 press release
by Norfolk Green Party.
The group Norwich & Norfolk Friends of the Earth said the Norfolk County Council should solicit and encourage more public participation in its reviews for the GAC, in part by posting information on its web site sooner and spelling out which committees will carry out reviews.
“It was a sheer fluke that I found out about this proposal going forward to Cabinet for rubber-stamping when trawling the agenda for Monday's meeting last Wednesday. Questions for Cabinet have to be submitted by 5 p.m. on Wednesday for the following Monday, and I had less than 10 minutes to cobble a question together,” Jennifer Parkhouse, an FOE coordinator, told BRN last week. “We cannot but fear that the Council feels it would not be in their interest to make the public aware of this project until as late as possible, and it was already a done deal.”
Iles has defended the council by saying the GAC is in step with public sentiment for more tech-based economic development expressed during the crafting of the regional economic strategy. Other government agencies have expressed similar visions: The East of England Plan, released in May by the UK government office for East of England, endorsed the creation of local development documents that promote “the life-science regional super-cluster with concentrations in the Cambridge sub-region, Hertfordshire, Cranfield, and Norwich” — where the Norwich Research Park is deemed a strategic employment site, its purpose being “to support regeneration and its role in bio-technology”
Parkhouse said the FOE had additional questions: “Since when did local government finance biotech research facilities? This is usually the remit of Research Councils and funded by [the] central government.”
In her interview with BRN, Parkhouse asked, “Why is the Council prioritizing biotech research? Why not research into sustainable agriculture, local food supply, organic production, jobs in renewable energy, for which this region is well placed? With regard to employment, if adequately, enthusiastically and properly funded, renewables must surely provide thousands of jobs in the region, especially if regard was given to reducing importation of labor and materials used.”
The GAC would also cement Norwich’s position as an anchor for the life sciences industry of the East of England region — whose largest and best-known concentration of companies is in Cambridge.
According to the Eastern Region Biotech Initiative, a life-sci industry group for the East of England, Cambridge is home to more than 185 biotech companies, 20 percent of the of the world's Nobel Prize winners in medicine and chemistry, 17 of the UK's publicly traded quoted biotech companies, and a quarter of Europe’s public biotechs.
“There is no doubt that the [GAC] will be a substantial facility and could establish the East of England, with Sanger in Hinxton and European Bioinformatics [Institute] as the dominant leader in Europe for this technology. It would also bring us closer to Cambridge than is currently perceived to be the case,” Iles concluded in his report.