Annex Two: ISCF Additional Guidance

What is the Industrial Strategy Challenge Fund (ISCF)?

The ISCF, part of the UK government’s Industrial Strategy, is a major new support initiative for UK businesses and researchers. It is part of the government’s commitment to invest a further £4.7 billion in UK research and development over the next four years.

The fund will invest in science and innovation challenges, to meet the demands and opportunities of UK industry, where the UK has the potential to turn strengths in research into a global industrial and commercial lead. Ten challenge areas were initially identified and six of these have been confirmed for significant investment. In order to ensure all opportunities are explored, GW4 are highlighting all of the ten original challenge areas. A further 250 smaller projects have received funding to a combined value of £100m over the next few years. These were chosen by Innovate UK from a diverse pool of previously submitted proposals that were not initially funded.

Whilst the area is developing, the GW4 Alliance is keen to encourage communities to consider the ISCF as a robust channel for development with partners, in order to position themselves to fully benefit this area of investment in the future.

ISCF has been discussed at the Heart of the South West LEP’s Future Economy Group with a view to encouraging universities within the region to work together on geographically important challenges, building on our collective research and industrial strengths and opportunities, and the Science and Innovation Audit.

How is the ISCF being administered?

The fund is being administered by Innovate UK and Research Councils UK (RCUK) until the new body UK Research and Investment (UKRI) becomes operational in 2018.

ISCF Challenge Areas

The ISCF aims to bring business and academia together to undertake research tackling core industrial challenges, to unlock markets and future industries in which the UK can become world-leading. The funding allocations are designed to help deliver a step-change in the UK’s ability to turn research strength into commercialised products. The ten key areas for investment that were originally recognized are:

  1. Bioscience and biotechnology
  2. Leading edge healthcare and medicine
  3. Manufacturing processes and materials of the future
  4. Smart, flexible and clean energy technologies
  5. Quantum technologies
  6. Robotics and artificial intelligence
  7. Satellites and space technologies
  8. Transformative digital technologies
  9. Integrated & Sustainable Cities
  10. Technologies for the Creative Industries


Through further work with academics and industry the government has now identified six key areas for investment over the next four years. The first three areas to receive funding are:

  1. Clean & flexible energy or the ‘Faraday Challenge’

£246m will be invested to help UK businesses seize opportunities in the transition to a low carbon economy, to ensure the UK leads in the design, development and manufacture of batteries for the electrification of vehicles.


  1. Cutting edge healthcare and medicine

£197m will be invested in the development of first-of-a-kind technologies for the manufacture of medicines that will speed up patient access to new drugs and treatments.


  1. Robotics and artificial intelligence (AI)

£93m will be invested in the development of AI and robotics systems for deployment into extreme environments (offshore and nuclear energy, space, and deep-mining) to make industry and public services more productive.

Subject to business case approval, three further areas are expected to receive funding over the next four years:

  1. Driverless cars

£38m will be invested in new collaborative research and development projects to develop the next generation of AI and control systems required to ensure the UK is well-placed to lead development of driverless care technologies.


  1. Manufacturing and future materials

£26m will be invested in the UK’s civil aerospace industry to develop the next generation of affordable, light-weight composite materials for aerospace, automotive and other advance manufacturing sectors.


  1. Satellites and space technology

£99m will be invested in the provision of a facility to support new technologies for satellite launch, manufacture and testing.