House of Commons - Science and Technology

Select Committee on Science and Technology Eleventh Report

5 Funding decisions and their impact

78. Perhaps the most contentious issue surrounding the Funding Bodies' proposals is their refusal to include with the plans for RAE 2008 any guidance on the funding mechanisms to be used. Universities UK is "very concerned about the review's lack of openness regarding funding implications" and that "the funding of the RAE will continue to be open to retrospective manipulation".[123] According to Save British Science, "there remain very serious problems with the new proposals. The most serious is that institutions will not have any idea in advance how their assessment scores will translate into financial rewards".[124] The Biosciences Federation agrees: "The Funding Councils should indicate the approximate ratios of funding for work at different star levels". It goes on, "[the] RAE is such an important issue for institutions that it is essential that the goalposts are clearly defined at the outset to aid sensible planning".[125] Research Councils UK argue that "more clarity is required about how the research quality profiles will be translated into financial allocations".[126] The AUT "believes strongly that the funding levels for the different 'star' ratings must be published prior to the exercise".[127] Professor Adrian Smith told us that "we really do need to know as soon as possible from the Funding Council the broad-brush sense in which they are going to make the funding allocations".[128] Despite this, HEFCE told us that further details about the technical aspects of converting profiles into QR funding will be announced during 2005. It says "It is simply impossible for the Funding Councils to make commitments regarding funding when virtually every dimension of the formula remains unknown".[129]

79. We agree with our witnesses that it is impossible to decouple the RAE from the funding decisions based on it. During our earlier inquiry, HEFCE made much of the RAE's positive effect on universities' research strategies. We do not dispute this, but a department's research strategy will be closely intertwined with its financial projections. By not giving an indication about how funding decisions will be made, universities are being asked to develop investment strategies with no basis for calculating the potential return. Under the current system, a 3b department makes a decision on whether to invest to become a 4 or even 5-rated department in the knowledge that improvement to 3a will result in no extra funding. At present we have no indication about which parts of a department's quality profile will attract funding. HEFCE told us that it will provide further details about the technical aspects of converting profiles into QR funding during 2005, only three years from the census date for RAE 2008. Departments need to know how to play the RAE game, yet HEFCE is asking them to do it blindfolded. HEFCE should draw up guidance to universities on how the quality profile will be used to calculate the funding. We appreciate that there are a number of variables that cannot be known in advance of the RAE but HEFCE should have the capability to produce estimates which would enable it to provide indications about the level of funding provided to each band of the profile. It should do this without delay.

Trends in funding decisions

80. HEFCE's decision for the funding weights for the 2002-03 academic year was made during the course of our earlier inquiry. HEFCE was in a difficult position. RAE 2001 had resulted in a significant increase in the number of 5 and 5* departments. In RAE 1996 31% of research active staff worked in 573 departments rated 5 and 5*. In 2001 the figure was 55% in 1,081 departments. Faced with a fixed budget, HEFCE had little alternative but to change the funding formula it had employed for 2001-02. We argued at the time that it should have done more to anticipate the problem and make clear to universities that they should make no assumptions about the funding formula to be used. The level of selectivity that had been employed at the time of RAE 2001 had broad support and there was an expectation that funding would be allocated on a similar basis. Indeed, many of the strategic investments made by universities will have been made on this expectation. HEFCE chose to maintain the level of funding to 5 and 5* departments and eliminated funding for 3a departments and below, thus increasing the degree of selectivity. Many of the hardest hit were in the new universities which were building up their research capability from a relatively low base. Departments rated 4 now get much less than they used to and, in 2004-05, no 3a and 3b departments will get QR funding (see Table 4). We concluded that if cuts needed to be faced they should have been applied equally across all grades.

81. Since then, the decisions taken by HEFCE have further concentrated funding (see Table 4) to the point where HEFCE describes it as "highly selective".[130] Sir Howard Newby told us that for 2002-03 "resources were not made available to fully fund it [RAE 2001]".[131] This betrays an acceptance that there was an ideal funding formula, which had been used previously and would have been applied to the results of RAE 2001 if the resources had been available. It is strange, therefore, that HEFCE should choose to depart further from this ideal when there was no financial pressure to do so. It is not clear to us why HEFCE has deemed it necessary to further increase the level of selectivity of QR funding. We regret that it will intensify many of the problems caused by the RAE and the funding decisions based on it.

Capability funding

82. In our 2002 Report we advocated a funding stream for developing research capacity. We proposed that departments could apply for development money through a bidding process and would be assessed by subject panels based upon the RAE UoAs. Applications would be based on a business plan which should indicate how they intended to achieve a higher research quality rating.[132] The rationale for this fund was that departments should be able to develop their research capacity from a low base and that a high level of selectivity made this difficult. The problem had been compounded by the abolition of the CollR (Collaborative Research) funding stream for the post-1992 universities, which aimed "to support the further realisation of research potential [in the former polytechnics] by encouraging the selective use of funds, and also by supporting 'collaboration as a way of developing research potential' where appropriate".[133] This amounted to £16 million a year.Table 4. Funding weights employed by HEFCE in recent years.

RAE rating Funding weights for:

2001-02 2002-03 2003-04 2004-05

5* 4.05 2.71 3.357 3.362

5 3.375 1.89 2.793 2.739

4 2.25 1.00 1 1

3a 1.50 0.31 0 0

3b 1.00 0 0 0

2 0 0 0 0

1 0 0 0 0

83. For 2004-05 HEFCE announced that it was providing £17.5 million as a capability fund. This will be restricted to research in emerging subject areas where the research base is currently not as strong as in more established subjects. Seven units of assessment (UoAs) are eligible for this funding, on the basis that they have low proportions of staff in departments rated 4, 5 or 5*, and had relatively high proportions of staff in 2002-03 attributable to 3a or 3b-rated departments.[134] The seven subjects eligible for this funding are:

a) Nursing;

b) Other studies and professions allied to medicine;

c) Social work;

d) Art and design;

e) Communication, cultural and media studies;

f) Drama, dance and performing arts; and

g) Sports-related subjects.

84. The fund will be distributed pro rata to the number of research-active academic staff in RAE submissions rated 3a or 3b, weighted according to the cost weight for the UoA. Institutions must submit three-year research strategies. This fund bears many similarities to the funding stream we advocated. A key difference is the restriction of HEFCE's scheme to seven subject areas. There is no provision for the development of mainstream science and engineering within the capability fund which would allow new university departments to develop their research capacity in these important subjects. We take issue with the restriction of eligible subjects. While we do not doubt that these subjects need developmental funding, it is too prescriptive and ignores the potential in other new areas of research. Also, it is not clear how HEFCE will judge between different applications. While we welcome the fund, it should be deployed more flexibly. Departments should be encouraged to submit ambitious plans for development and expansion. There is an urgent need in some areas to develop centres of excellence. There is a danger that this modest fund could be distributed too thinly. We note the comments of the UK Computing Research Committee, which says "there must be sufficient money for research outside the elite group to support the development of new ideas and talented researchers wherever they may emerge".[135] We do not see any value in excluding departments that are unranked or graded 1 or 2. Funding should be based on potential not on past record. We welcome HEFCE's capability funding as a means of building research capability and promoting dynamism in the research base. We are concerned, however, that it is too restrictive. We believe that all departments should be eligible and grants should be awarded on the strengths of their research and investment strategies.

Impact

85. In our 2002 Report we reported substantial "collateral damage" caused by the RAE. Some of this related to the way research was conducted in our universities but we also concluded that the RAE, and the funding decisions based on it, create incentives for universities that could lead to them neglecting other areas of their functions, such as:

a) teaching;

b) community involvement;

c) commercial activity; and

d) research of local or regional significance.

Research

86. In 2002 HEFCE recognised that "Any assessment process, particularly one as important to its subjects as the RAE, will distort the very thing it intends to measure".[136] We considered in our earlier Report whether the RAE distorts the nature of research being undertaken; that it discourages longer term "blue skies" research and forces researchers to look for short-term goals; that publication practice is being affected; and that research careers are being undermined, in particular for women.

87. The UK Computing Research Committee draws attention to the "increasing focus on safe, incremental research and an unwillingness to cross discipline boundaries or to explore adventurous ideas that may not lead to publishable results. The original RAE contributed to this change, by focusing on recently published research and thereby compelling researchers to maintain a stream of publishable work. The Funding Councils' proposals will not relieve this pressure".[137] They say that "The RAE is often presumed to inhibit interdisciplinary research. A 1999 Report found no evidence that panels treat interdisciplinary research differently but reported a widespread perception that they did so. It noted that this perception could itself influence the willingness of institutions to support interdisciplinary research". Nevertheless, the Funding Bodies report that they "are giving active consideration to Sir Gareth Roberts' suggestion that virtual 'colleges of assessors' be recruited in established interdisciplinary areas which do not fit neatly into the RAE panel structure".[138] Universities UK is "encouraged by the intention that the 2008 RAE will, in principle, take better account of vital applied, inter- and multi-disciplinary research".[139] In their proposals published in July 2004, the Funding Bodies give more information about how the RAE will handle interdisciplinary research—mainly by "improved arrangements for the sub-panels to take additional specialist advice". This they believe "will ensure, wherever a sub-panel has to consider significant bodies of interdisciplinary research, that such research is assessed taking account of advice from people who fully understand it". Also "the two-tier panel structure will be helpful where research is submitted that draws on the approaches and methods of related disciplines within the same main panel field".[140]

Concentration of research and departmental closures

88. We described above HEFCE's increasingly selective funding policies which have been pursued without any clear rationale. It has been a concern of many within the research community that research funding has become increasingly concentrated in a handful of universities. The Geographical Society with The Institute of British Geographers has "serious concerns about the potential for further concentrations of research funding" since "The many 4-rated geography departments in UK (35% are rated 4 in the 2001 RAE) are an important bedrock and, along with 3a and 3b departments, a significant training ground for UK geographical research".[141] The Biosciences Federation also "opposes any further narrowing of the research base".[142] Universities UK shares this concern and "has been deeply concerned by the cuts in funding to departments rated 4 and below, and the Government's policy of further concentration of research funding".[143] Concern is not limited to academia. The White Paper The Future of Higher Education, published in January 2003, assumed that the concentration of research would enhance national research performance. This assumption is based on virtually no supporting evidence. By contrast, a study commissioned by Universities UK from Evidence Ltd, Funding Research Diversity: The impact of further concentration on university research performance and regional research capacity demonstrated that investment in departments scoring a 4 or 3 in RAE 2001 was important for developing the performance of the research base at regional, national and international levels".[144] The Office of Science and Technology commissioned its own study from the Science Policy Research Unit at the University of Sussex, which 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".[145]

89. The Wellcome Trust has "serious concerns over how the results of RAE 2008 will be utilised in the allocation of research funds. It is our belief that the level of research funding is already highly selective and should not become even more so". The Trust says that it is "vital that the funding method provides support for teams and infrastructure and ultimately provides funds to departments that are fit for purpose".[146]

90. That research has become increasingly selective is not open to doubt. Less easy to establish is the link between this trend and the closure of physical science departments. In our earlier Report we concluded that "The RAE may not be the primary cause of departmental closures but we suspect that it is a contributory factor".[147] HEFCE's withering response was, "We do not understand what point is being made here. The RAE provides a mechanism for allowing continued funding for excellent research, even if student numbers are falling".[148] Sir Howard had been in post for little over six months at HEFCE when we received its reply and in the two years since he has clearly mellowed: "The vast bulk of those [departmental] closures […] have been in Grade 1 and 2 RAE categorised departments, and they have also been in very small departments, so this is where vice chancellors have been […] taking their investment decisions to invest in areas of growth, and disinvest from areas of [decline]".[149] Professor Richard Joyner had little doubt that the RAE had played a part and was concerned that the worst was to come, "because what has happened as a result of the 2001 financial settlement is that you now have an insurmountable entry barrier to anybody who wants to get into research in science and technology, and you have a big exit penalty".[150] We are pleased that Sir Howard Newby now recognises that a policy of highly selective research funding, based on the RAE, has had an effect on the viability of university departments in core subjects. The RAE does not take place in a vacuum and further changes are also now taking place in higher education following the 2003 White Paper and the introduction of variable tuition fees. It is too early to say what the precise impact of those changes will be. Concerns expressed so far, however, suggest that variable fees may also lead to closures of further university departments, quite possibly in the physical sciences. The operation of the RAE and variable fees may, therefore be mutually self re-inforcing and HEFCE should remain vigilant in these respects.

Regional dimension

91. It could be argued that departmental closures are not a problem in themselves if research capacity in those subjects is not impaired. The geographical pattern of these closures could be significant, however. If it left regions of the UK without adequate provision then this could impact on the access to academic research for local businesses and public services. It would also provide a more limited choice of subjects for potential undergraduates who wish to study locally. Rising debt among undergraduates may increase the number of students wishing to study at their nearest HEI. It was reassuring that Sir Howard recognised this as a problem: "because these closures have been uncoordinated, unplanned and somewhat random, there are some difficulties".[151] We therefore welcome the thoughtful suggestions made by HEFCE in supplementary evidence and the measures outlined in the Investment Framework, which provide the option for HEFCE to intervene when a department is threatened by closure by demanding 12 months' notice for closure and by offering extra funds in some cases.[152] The provisions for HEFCE to delay closure or offer funding to struggling departments have been criticised for threatening the autonomy of universities but this encroachment on their independence is a price worth paying for the preservation of core disciplines on a national basis. We accept that these powers should be used with restraint but this is an important shift in policy we welcome. Given the additional concerns over the possible effects of variable fees, these new powers for HEFCE are also extremely timely.

The teaching-research link

92. The link between teaching and research is hotly contested. In our earlier Report on the RAE we expressed support for "high-quality teaching in a high-quality research environment" and concern that teaching-only departments would not provide the environment to inspire science students to embark on a research career. "The Institute [of Physics] welcomed the explicit recognition of the importance of the link between teaching and research in the Funding Bodies' consultation document" but it was disappointed that the Funding Bodies' proposals made no mention of teaching.[153] The Biosciences Federation believes that the "RAE will continue to serve poorly less research-active staff who may make a major contribution to teaching and administration" and that there is "a problem with young staff of great promise who may, as yet, have only one or two papers". The Federation remarked that the provision for such staff was considered quite extensively by the Roberts group, but is not mentioned in the Funding Bodies Initial Statement other than in a vague reference to panel and sub-panel consideration of departmental strategies and staff development.[154] The research-teaching link has been considered by the new Higher Education Research Forum under the chairmanship of Sir Graeme Davies and we await its findings with interest.

123 Ev 52 Back

124 Ev 26 Back

125 Ev 33 Back

126 Ev 40 Back

127 Ev 49 Back

128 Q 13 Back

129 Ev 57 Back

130 HEFCE, Funding higher education in England: How HEFCE allocates its funds, May 2004/23 Back

131 Q 79 Back

132 HC (2001-02) 507, para 86 Back

133 HEFCE, Review of CollR, September 2001, p 2 Back

134 HEFCE, Funding higher education in England: How HEFCE allocates its funds, May 2004/23, paras 87-89 Back