Rolls-Royce says taking R&D an option if grants are cut

Engineering giant Rolls-Royce has said it could be forced to move its research and development budget abroad if the UK government cuts grants that it depends on.

The group fears that money currently spent on converting university research into business could be slashed as part of business secretary Sajid Javid's pledge to slash his department's budget by up to 40%.

The company's director of research and technology, Ric Parker, told the Sunday Times: "We depend significantly on grants to support investment we make in research and development.

"If other countries have more favourable systems for supporting innovation, there's a temptation to put your research and more of your manufacturing there, rather than in the UK."

Parker also highlighted a new combustion facility that has received support from the German government.