Select Committee on Science and Technology Fourth Report


9 Higher education policy

58. The OST is not responsible for higher education, yet it clearly has an interest since a very significant amount of publicly funded research is undertaken in higher education institutions. This is reflected in Lord Sainsbury's responsibilities, as described on the DTI website, which include "DTI interest in education and skills". Alongside the Higher Education Bill, the Government has also initiated several reviews with implications for both the Department for Education and Skills and the OST (see Table 3).Table 3: Government reviews of science and research in 2003.
Review Sponsoring department Status
The Sustainability of University Research (dual support) OSTConsultation closed 30 September 2003
University research assessment HEFCEA joint statement by the Funding Councils was published in February 2004
University research funding method HEFCEHEFCE announced new funding method on 23 December 2003
University teaching funding method HEFCEHEFCE announced new funding method on 23 December 2003
The Lambert Review of Business-University Collaboration TreasuryPublished 4 December, response due summer 2004
The Innovation Report DTIPublished 17 December

Research funding

59. In May 2003 the OST published The Sustainability of University Research: A consultation on reforming parts of the Dual Support System. It looked at ways in which HEIs cost and price their research and Research Councils fund and account for it. The OST has proposed a system in which the Research Councils shift from paying all the direct costs of a project (staff costs, except principal investigator) and 46% of indirect costs to paying 60-70% of the full costs. The OST's consultation suggests that it is a matter for the universities as to how they should allocate their block grant but provides guidance on how much to charge for indirect costs for different types of project. The Science Budget has £120 million for 2005-06 to implement this change. It is disappointing that the OST will not publish submissions to its consultation on dual support before it publishes its response. It is normal practice for the Government to publish at least a summary of submissions before reporting. It is reasonable that, where the authors have given permission, submissions are published as soon after the deadline as possible. If the Government's decisions are seen to be made in an open and transparent manner, the evidence being used to inform that decision should be freely available as soon as possible.

60. The Higher Education Funding Council for England's (HEFCE's) consultation on research funding method set out suggested funding levels for departments according to their Research Assessment Exercise (RAE) ranking. It also proposed changes to the volume measure, used as an indicator of research capacity. One of the most controversial elements is the removal of charitable income, on the basis that it is irrational to use this as a factor when it does not do so for other forms of project income such as that from Research Councils or business. Research charities have tended to argue that the indirect costs of the research they fund should be met by Government. The Wellcome Trust, in its submission to the dual support review, criticised the lack of coordination between the OST and HEFCE. In its announcement of 23 December 2003, HEFCE said that it would "continue work on revising the research funding formula and subject cost weights, for implementation after the next RAE, in close consultation with other research funders including charities and the Research Councils". In the short term, charitable income will continue to be used to calculate research volume.

61. The Government's science strategy Investing in Innovation explicitly recognised the importance of charitable funding to the Research Base.[67] Lord Sainsbury recognised that charities could go overseas to spend their money as a result of HEFCE's proposals. It is surprising, therefore, that he did not insist that charities were represented on the new Higher Education Research Forum, set up by the OST and the DfES under the chairmanship of Sir Graeme Davies.[68] Charities such as the Wellcome Trust have made a huge contribution to UK research and it is important that their interests are represented at a high level in Government. We are concerned that the new Higher Education Research Forum does not include a representative from the research charity sector. We recommend that this oversight is remedied without delay.

62. The reviews on The Sustainability of University Research and University Research Funding Methods seek to tackle effectively the same important issue - the functioning of the dual support system. It is astonishing that they were initiated and conducted separately. Lord Sainsbury was keen to point out that the results will be brought together but it emphasises the degree to which the two pillars of the dual support system are being considered in isolation. The Minister admitted that these and the other reviews "do interact to a very great extent" and that there was "a ministerial committee looking at this which will pull together all these reports".[69]

63. Lord Sainsbury told us that it was "probably right to do the different reviews".[70] Separate reviews may have been appropriate but we believe that their terms of reference should have been drawn up with reference to each other. The Government has undertaken a haphazard approach to these reviews which has not served science, research and innovation well. A more coordinated approach to policy-making is needed. Science and research are in danger of being over-reviewed, wasting the time of researchers and lecturers who feel obliged to make responses, and the uncertainty they engender is demoralising for these staff. We can only hope that as a result of these reviews on science, research and innovation a clear timetable for implementation is drawn up.

Research assessment

64. Following the 2001 RAE, the Funding Councils commissioned Sir Gareth Roberts to report on the future for research assessment in the UK. Among his key recommendations were the suggestions that the burden of assessment for institutions and assessment panels linked to the amount of funds the institution is competing for, grade bands to be abolished in favour of a profile of the research strength of each submission, providing for a continuous rating scale. Following a UK-wide consultation on the recommendations of of Sir Gareth's review and related issues, the funding bodies made an initial analysis of responses to identify the main areas of consensus and also where opinion is more divided. The Funding Councils made an initial statement on 11 February 2004, outlining their proposals for the RAE in 2008.[71]

65. In our Report on the Research Assessment Exercise (RAE) in 2002, we expressed concern over the increasing divergence in the dual support system's funding streams; nevertheless we gave our backing to the system on the proviso that the two streams should be better integrated.[72] An alternative model of calculating the university block grant for research on the basis of Research Council income was rejected by us on the basis that it would increase the concentration of research in even fewer universities. We announced, also on 11 February 2004, plans to conduct a short inquiry into the Funding Councils' proposals, following up our 2002 Report.[73]

66. We agree with the Royal Society that it is "unfortunate that the opportunity was not taken to undertake a more fundamental review of the overall public funding of university research".[74] The Royal Society argues that the two distinct strands of the dual support system could be replaced by a simpler system in which, for each university, the sum of a department's funding from the Research Councils, charities and business could used as a basis for calculating the research component of the university block grant. We are concerned that the Government's piecemeal approach to research funding does not serve UK science well. We shall be monitoring developments in higher education science with interest over the next year.

Research concentration

67. A recent Report by the Science Policy Research Unit (SPRU) at Sussex University, prepared for the OST, concluded that "there seems to be little if any convincing evidence to justify a government policy explicitly aimed at further concentration of research resources on large departments or large universities in the UK on the grounds of superior economic efficiency".[75] Lord Sainsbury was unable to provide any conflicting evidence and relied on an assumption that because research concentration had increased in recent years was because bigger research teams are more productive.[76] We are concerned that such important decisions about the shape of the UK research landscape are being made without adequate evidence to support them; indeed, they are being made with a complete disregard for the conclusions of an academic study which the OST commissioned. The Russell Group universities will argue that they need to be able to compete on a global scale. What is good for these universities as businesses is not necessarily good for British science. We welcome the fact that the OST is commissioning academic studies to provide an evidence-based approach to policy-making. It is regrettable, therefore, that having done so, the Minister is content to disregard a study's findings.

68. An increasing role for the Regional Development Agencies (RDAs) in innovation is being proposed. The Cross-Cutting Review of Science and Research, published in 2002, stated that "the RDAs will be best placed to match the needs of regional industry with the existing and potential Science Base in the regions".[77] It has been argued that businesses benefit hugely from having a university research capability in close proximity. We are concerned that this will become less likely if further research concentration is allowed to happen. Lord Sainsbury pointed out that every Government Region has at least one of the top 25 universities in it.[78] He extolled the merits of the universities in the north west and north east, and we would not wish to disagree on this point.[79] However, it is not sufficient for there to be a research university in each Region if these universities do not have capability in all science and engineering disciplines. Sir John Enderby, President-Elect of the Institute of Physics, said recently that "there are large areas of the country where there is no higher education in physics … Not only is there less choice for students but parts of the country are without the expertise provided by physicists".[80] The UK has a high level of research concentration. Should this trend continue, the UK risks whole regions being devoid of research capability in subjects, particularly the physical sciences and engineering, that underpin innovation. This undermines the Government's attempts to make universities the drivers of the knowledge economy in these areas because many universities that provide research support for regional and local industry and commerce would be starved of funding and their research would become unsustainable. In addition, the increasing prospect of debt is likely to force students to study nearer to home and the option to study physics, chemistry or engineering should not be denied them. It should be the Government's policy to maintain capacity in a full range of disciplines in each region.

Teaching funding

69. The Higher Education Funding Council for England has consulted on a change in the weighting for teaching. These weightings are used to determine the university block grant (see Table 4).

Table 4: The Higher Education Funding Council for England's proposed change to the subject weighting for teaching.
Price group Description Current weighting Observed cost relativity Proposed new weighting
AClinical subjects 4.54.34 4
B1High-cost laboratory-based science, engineering and technology 21.93 2
B2Other laboratory-based science, engineering and technology 21.56 1.6
CIntermediate cost subjects with a studio, laboratory or fieldwork element 1.51.21 1.3
DAll other subjects 11 1

Source: Higher Education Funding Council for England, Developing the funding method for teaching from 2004-05: consultation, August 2003/42, Table 2

70. Examples of B1 subjects include chemistry, physics, chemical engineering and material science. B2 subjects include the non-clinical life sciences and other engineering subjects. The current funding method for teaching was first applied to higher education institutions in the allocations for 1998-99. Save British Science calculated that the proposed funding method would lead to a £22 million cut in undergraduate science teaching. It criticised the weightings on the basis that they have been calculated on what universities currently spend rather than what the teaching ought to cost.[81]

71. When asked his views on HEFCE's proposed teaching funding formula, Lord Sainsbury responded that this was "firmly part of DfES's responsibility" and that he has no formal input into the process.[82] If the Minister is responsible for the DTI's interest in education and skills, then either the Department has no interest in these issues or he is failing in his duties. In giving evidence to the Committee, the Chief Executives of both the Medical Research Council and the Biotechnology and Biological Research Council made clear their hostility to HEFCE's proposals.[83] If the Research Councils feel that this an issue of concern, they will have been disappointed to learn that their Minister takes no responsibility for representing their views within Government.

72. On 23 December 2003, HEFCE announced its revised proposals. It abandoned the idea of splitting price group B but there will still be a shift away from laboratory-based subjects (see Table 5).

Table 5: Revised teaching funding formula announced by HEFCE.
Price group Description Current weighting Proposed new weighting Final decision
AClinical subjects 4.54 4
B1High-cost laboratory-based science, engineering and technology 22 1.7
B2Other laboratory-based science, engineering and technology 1.6
CIntermediate cost subjects with a studio, laboratory or fieldwork element 1.51.3 1.3
DAll other subjects 11 1

Source: www.hefce.ac.uk/News/hefce/2003/funding.asp

73. The scientific community will have been relieved that HEFCE decided to modify its proposals but it seems they have little to thank the Science Minister for. The Science Minister has accepted that many issues concerning science, research and higher education are interrelated. It is reasonable to expect that he provide formal input into the deliberations of Ministers in the Department for Education and Skills and be able to articulate the policy as a whole in giving evidence to us. His statements give us no confidence that these issues are being considered by Government in a coherent manner.

Tuition fees

74. There has been concern about the effect of top-up fees on undergraduate applications in high cost science subjects. There is a danger that universities, faced with financial pressures, will be tempted to cut courses or charge higher fees for students in these subject areas. An alternative scenario was put forward by the Minister of State for Higher Education, Alan Johnson, who told the Education and Skills Committee that it was "a near racing certainty, that chemistry and physics, where they have high infrastructure costs but they need the volume, will charge nothing, or next to nothing, to attract students, and cross-subsidise perhaps from law".[84] We raised this issue with Lord Sainsbury, who told us that this was a matter for universities to decide and that he was more concerned with making young people aware of how exciting and relevant the physical sciences and engineering were.[85] He felt that science would benefit from tuition fees since they would ensure that science courses were funded properly.[86] Properly funded courses are of little value, however, if insufficient students can be attracted to enrol on them.

75. Despite the efforts of the Minister, changing the perception of young people will not happen quickly or easily. In the short term, we will need to buck the market or we will lose large numbers of university departments. Lord Sainsbury rejected any suggestion that the Government should be more proactive:

"I cannot see any value or merit in trying to say to universities, 'You have to run courses in which you are not getting people to do it.' In terms of the powers of the government to do that, they are extremely limited. How can we hold universities responsible for their finances if we start telling them they have to run courses where there are not individuals there? The thing that drives it has to be what the young people want to do".[87]

In recent years, the Government has recognised the shortage of science teachers and introduced financial incentives. The Roberts Review identified the serious problems in attracting young people to certain scientific disciplines and recommended that differential PhD stipends be introduced to attract students.[88] This argument was accepted by Government and implemented in Spending Review 2002.[89] It is not clear why Lord Sainsbury is unwilling to consider applying this principle to the undergraduate market. On 23 January 2004, the Institute of Physics (IOP) announced that it would be awarding £1,000 means-tested annual bursaries for physics undergraduates. The IOP has recognised that increased student debt could deter potential physics students. We congratulate the Institute on its decision but the Government should act also. A review of maths education, commissioned by Department for Education and Skills and published in February 2004, has recommended that financial incentives may be necessary to improve the uptake of maths courses post-16.[90] The Government should consider establishing bursaries for undergraduates to study shortage subjects, such as physical sciences and engineering. These should cover the full cost of the charged top-up fee.


67   Department of Trade and Industry, Investing in Innovation: A strategy for science, engineering and technology, July 2002,paras 3.18-3.19 Back

68   HC Deb, 18 December 2003, Col 153WS Back

69   Q 4 Back

70   Q 4 Back

71   Higher Education Funding Council for England, Initial decisions by the UK funding bodies, RAE 01/2004, February 2004,  Back

72   Second Report of the ScienceandTechnologyCommittee, Session 2001-02, The Research Assessment Exercise, HC 507. Back

73   Press notice no. 19, Session 2003-04 Back

74   The Royal Society response to the OST report on the sustainability of university research, September 2003 Back

75   von Tunzelmann N, Ranga, M, Martin B and Geuna A, The Effects of Size on Research Performance: A SPRU Review, June 2003 Back

76   Q16 Back

77   HM Treasury, Cross-Cutting Review of Science and Research: Final Report, March 2002, para 231 Back

78   Q 16 Back

79   Q 16 Back

80   Universities fear science courses will disappear, Daily Telegraph, 2 February 2003 Back

81   Save British Science, Press Release, 24 October 2003 Back

82   Qq 6-7 Back

83   Second Report of the Science and Technology Committee,Session 2003-04, Chief Executive of the Medical Research Council: Introductory Hearing, HC 55, Q 63; Third Report of the Science and Technology Committee, Session 2003-04, The Work of the Biotechnology and Biological Sciences Research Council, HC 6, Q 45 Back

84   Minutes of Evidence, Education and Skills Select Committee, Session 2003-04, Ministerial Annual Review, HC 75-i, Q81 Back

85   Q 13 Back

86   Q 9 Back

87   Q15 Back

88   SET for success, The supply of people with science, technology, engineering and mathematics skills, The report of Sir Gareth Roberts' Review, April 2002, Recommendation 4.1 Back

89   HM Treasury, 2002 Spending Review, Opportunity and Security for All: Investing in an enterprising, fairer Britain, New Public Spending Plans 2003-2006, para 25.8 Back

90   Department of Education and Skills, Making Mathematics Count, The Report of Professor Adrian Smith's Inquiry into Post-14 Mathematics Education, February 2004, para 0.31 Back


 
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