The Politics and DV Engineering working group analyses current political developments in the defence sector. It provides independent facts and interpretation from the technological knowledge and experience of engineers.
The Politics and DV Engineering working group has questions and comments on the Defence Strategic Knowledge Agenda 2021-2025 (Parliamentary Paper 35570-X-32 dated 27 November 2020). The comments have been prepared based on publicly available information and defence technology knowledge and experience.
Like the Defence Vision 2035, the SKIA 2021-2025 is very much in line with the advice given by the KIVI working group in recent years. This strategy contributes significantly to preserving, protecting and developing strategic knowledge, technology and capabilities of and for Defence.
The working group's comments are therefore limited. They include the role of innovative SMEs outside the traditional defence sector; on risk mitigation for companies; on specialisation within Europe and on changing R&D to R&T.
Page 6 Collaboration and page 7 Ecosystem - focus on defence sector
It is indicated that collaboration has long taken place in the Golden Triangle. Defence promises to do a lot to position this sector well in Europe too.
However, outside the defence-related industry in the Golden Triangle, a lot of technology is also being developed that is applicable to Defence, especially in the short-cycle domain. Think of the automotive sector, solar energy, energy storage, etc.
However, other sectors often use a different business model than in the defence sector. For example, in terms of financing, guarantees, purchase obligations and cooperation with the client during product development. It is important that the Ministry of Defence also creates opportunities for knowledge institutions and companies outside the defence sector so that they can participate in a way that fits their business model.
Page 13 Knowledge and Innovation - R&D has been changed to R&T
Unlike previous SKIAs, this time R&D is not mentioned, but R&T. This is more in line with European habits, but has the important consequence that the important topic of "Development" is no longer part of this agenda. Moreover, this is the most expensive part of an innovation project. It is unclear where the "Development" component has gone, how it is funded and what the product or service development policy is.
Pag.13 Defence Research & Technology - limited use of knowledge
This paragraph emphasises the need for TNO, NLR and MARIN knowledge to "assess third-party products and services, integrate products and access knowledge accumulated in an international context". It seems here that Defence only wants to use R&T knowledge internally. This also fits with signals the working group is picking up in the sector and does not do justice to the capabilities of the three institutes and the costs of this knowledge accumulation.
The working group believes that the accumulation of technological knowledge should also be maximally targeted and deployed to enable product development for Defence purposes. Directly by companies, but also through valorisation and spin-off processes.
Page 16 Financing long-cycle innovation - risk too high for SMEs
in this paragraph reports that industry co-finances in principle when developing promising, critical technologies. A large survey of European SMEs by our umbrella association EDTA found that 70% of SMEs in the defence sector consider the product and market risk for (co)financing too high. However, in many policy documents, SMEs are considered very important for effective innovation.
Defence should increase SME participation in innovation by reducing the - often insurmountably - high risks for these companies. For example, by providing more certainty on future procurement of future products and financing guarantees.
Page 17 Innovation radar - also outside the sector?
Our comments on pages 6 and 7 indicated that outside the defence-related industry in the golden triangle, however, a lot of technology is also being developed that is applicable for Defence, especially in the short-cycle domain. For example, the automotive sector, solar energy, energy storage, etc. However, there is an impression that the innovation radar focuses mainly on developments within the defence sector.
Pages 17 and 18. Defence as launching partner - uncertainties too high for SMEs
The conceptual idea of Defence as launching partner is very good. So is the intention to provide demand articulation, a network and/or an experimental environment. This reduces the technical (product) risk for a company. Ultimately, however, what matters is that an innovation actually comes to production, delivery and deployment. That certainty is still not offered to companies, so market risk remains too high for short-cycle innovation to be as effective as in the rest of the economy.
The risk for SMEs can be reduced by entering into innovation partnerships under the Procurement Act 2016 and/or providing funding guarantees such as the EFSI.
It is unclear whether the Secretary of State's 2019 commitment has been realised and the innovation partnership is being implemented. If so, it could be added to the SKIA as an instrument.
Page 27 International R&T cooperation - opportunities and implications of EU specialisation
The described forms of cooperation assume knowledge sharing based on intergovernmental reciprocity. Usually within the same knowledge areas. This does not fit well with framing principle #9 of Defence Vision 2035(Specialisation within NATO and EU). It is unclear which R&T research Defence is stopping on the basis of this furnishing principle and which areas, on the contrary, the Netherlands wants to focus on.
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The Hague, 11 January 2021
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Disclaimer: The facts and opinions given are based on open sources and on the knowledge and experience of working group members.
As part of the professional association KIVI, the working group is independent of political parties, governments and companies.
This is not an official position of KIVI. The association accepts no liability for anything put forward by the working group or its members.
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