Margareta Pagano: There's an art to funding science after the cuts

And the Rolls-Royce prize points the way

Sir John Rose will present his seventh and last Science Prize as chief executive of Rolls-Royce tomorrow night when he hosts one of the year's most interesting events at London's Science Museum.

Nine schools have been chosen by Rolls-Royce to share the £120,000 prize which they will spend on experiments ranging from the chemistry of the solar system to building a hydroponic greenhouse. Sir John's scheme may be tiny, grass-roots stuff, but it's a perfect example of how private-sector philanthropy works together with the state. More pertinently, it provides a foretaste of how academia will have to pay its way when the government's £6bn science funding is cut by the forecast 15 per cent. It takes a lot to get academics worked up but this weekend they plan marches and petitions, while eight Nobel laureates were angry enough to write to newspapers arguing that the cuts (along with the immigration cap) will devastate the UK's research and jeopardise growth.

But is this true? Should science be more exempt than the arts or, indeed, couples being denied child benefit? And will British growth really be hurt by these cuts? To answer the first question, if the Comprehensive Spending Review is to be fair, surely it has to be comprehensive. But, while supporting scientific research is important to future economic growth, it isn't necessarily true that it can only be done efficiently with the taxpayers' money.

Take microfinancing, or "crowd-funding" as it's known in the US. Cuts to US government funding three years ago were the catalyst to this kind of donating, whereby Joe Public gives small contributions to research projects chosen by scientists. These are peer-reviewed, and put online for donors to choose from, with a research log kept to inform them of progress. Researchers retain ownership and intellectual rights, so it's commercial too. Whether this catches on more in the UK, though, will be a moot point as Americans give about four times more than Brits to charity.

Philanthropy is leading the pack in another way. According to Chemistry World, science funding by philanthropists is more flexible and productive than state-funded research because it's tied neither to the public purse nor to public opinion. It's a view backed by a fascinating report from the Royal Society, The Scientific Century, which demonstrated that putting money behind scientists rather than pre-destined projects is far more blue-sky, as brilliant discoveries or inventions are so often serendipitous. Indeed, the UK's biggest science-to-medical charity, the Wellcome Trust, now awards grants, or investigator awards, to brainy individuals rather than to projects because it accepts that following the genius of the scientists – giving them the freedom to switch in and out of their research – is the real issue. Think Teflon, penicillin, X-rays, gelignite, cornflakes, Viagra and microwaves – a few brilliant mistakes from our greatest minds.

While there will be gaps that philanthropy can't fill, they may not be too devastating if we balance carefully the alternatives; as Louis Pasteur said: "In the fields of observation, chance favours only the prepared mind." Who knows, those schoolchildren chosen by Rolls-Royce now may well be the ones making the most wonderful mistakes in the future.

Money bags: A swinging profit for Mulberry

What women have in their handbags is a mystery to most men but why (and how) women buy such exorbitantly expensive bags is to me the even bigger mystery. The Somerset-based Mulberry handbag company defied gravity yet again last week to reveal that even more women are buying even more of their bags, which start at around £500 and soar upwards. Sales were up 70 per cent in the past 10 weeks, and, no surprise, most of the buying is in the Far East. Analysts sharpened their pencils – looking for £13m profits next year. Shares, at 465p, are tipped to fly even higher. Time to tuck some away in those cavernous handbags, girls? Any old brand will do.

Cameron's conference speech had a banker-sized hole in it. Now, why was that?

There was one glaring omission in David Cameron's conference speech which I've been puzzling about all week. If he wants the broadest shoulders in society to share the burden of cutting the deficit, then why didn't he mention the broadest of all; the deltoids of our masters of the universe – the bankers?

His speech referred to the banks once, and that was in relation to getting them lending. There was nothing about pay or, more importantly, structural reform of the banking industry.

We've already had early estimates that some £7bn will be paid to the City's finest in bonuses for 2010. Bonus packages are not decided until the end of the year, but it can't be long till stories start appearing about the millions of pounds going to Royal Bank of Scotland and Barclays bankers et al. In terms of timing, it couldn't be worse. In two weeks, the full fall-out from the Comprehensive Spending Review will be giving the unions and opposition leaders free reign to run amok; one law for the public sector and one for the bankers?

Cameron and George Osborne made a terrible error in announcing the child benefit cuts at conference (a good enough reason why policy statements should always be made in Parliament for full scrutiny). But I don't believe either of them is so foolish as to fail to anticipate an outcry over bankers's pay. After all, it was the Chancellor who beat the populist drum this time last year. Can you imagine what the reaction will be if state-owned RBS reveals it has paid 100 staff a million or more each? No. That's why I think that either Cameron is planning something big to hit the bankers with; or he knew the Europeans were doing his dirty work for him, as we saw on Friday when the EU unveiled a bonus cap, setting a 30 per cent limit on the amount of cash received upfront. Much fiercer than our own 50 per cent. Very handy, those Europeans.