BEIS has published its allocations to UKRI councils for the next three years. What have we discovered?

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This blog was written by Stephanie Smith, Head of Policy (Research and International) at the Russell Group.

What have we learned?

Overall this is a good result for research and development in the UK, and for UKRI more generally. Department for Business, Energy and Industrial Strategy (BEIS) statement says UKRI’s budget will rise from £7.8bn in 2021/22 to £8.9bn in 2024 /25; the core budgets of all councils, including Innovate UK, will also increase over this period. Research England and Innovate UK are particular winners – signaling the government’s continued commitments to innovation and (hopefully) basic research.

More interesting data can be found in UKRI’s helpful ‘Data Explainer’. This shows that 95% of UKRI’s 2022/23 budget is already committed – at least for the start of this financial year. This means that money will be limited at the start, which could put pressure on Council budgets. The good news is that this margin amounts to £2.5bn of uncommitted expenditure over the course of 2022/23, which should allow UKRI to start implementing its new strategy – the first in its history. , given that this is the first time she has been given a three-year settlement to plan with.

This uncommitted spending margin almost doubles over the course of 2024/25, which should put UKRI on a good start for the next spending review period, when the organization will have to make its next funding offer. The hope is that UKRI will be able to use this funding to build the resilience of the UK’s research and development base, particularly given the low recovery rates on the full economic costs of grants. research, leading to a £4.6 billion a year deficit in the sector. level.

As well as setting out the overall budget allocations for the next three years for each of the councils (and Innovate UK), UKRI has tried to make more transparent what will happen to those budgets over the next three years – a relief for fans of politicians who have struggled to uncover where spending from the National Productivity Investment Fund (NPIF), talent and official development assistance (ODA) could mask declines in real terms in core government budgets. Advice.

In doing so, the scale of the government’s science and innovation ambition is laid bare – while Innovate UK will see increases of 54% to its base budget, from £631million to £970 million in 2024/25, the Arts and Humanities Research Council and Economic and Social Research Council budgets will see only modest increases (£61-70 million and £114-122 million, respectively) . With much more funding for infrastructure, talent and inter-council funding allocated outside of the Council’s core budgets, the hope is that UKRI will be able to find other ways to support these disciplines strategically. vital.

Other councils will also get off to a rocky start, with the Biotechnology and Biological Sciences Research Council, Natural Environment Research Council and Research England facing funding cuts at the start of 2022/23, before to see overall increases in subsequent years.

What haven’t we learned?

The publication of the data presents the overall budgets for each of the councils, but does not indicate how the funds will be distributed between the different budget lines. Those wondering how Institutional Quality Linked (QR) allocations will play out will have to wait until later this year, when Research England and the other councils publish their new strategic delivery plans.

Given that the higher education sector as a whole has improved its performance in the REF this year, many have speculated that QR funding – and its equivalents in decentralized countries – will need to increase significantly in order to recognize the rise of world-leading research across Britain.

With Research England’s budget set to fall by 2.4% (£42m) in 2022/23, that seems hard to achieve. But there are several reasons to stay positive. The situation for 2023/24 is much better, with his budget set to increase by £433m.

Even better, while funding allocations to UKRI have been made on the basis of a financial year, Research England distributes QR funding on the basis of an academic year. This gives him some flexibility in how he deals with the year ahead and should help him smooth out some of those transitions.

In addition, UKRI’s budget explanation sets out several commitments aimed at ensuring stability in the sector by keeping the double support balance “at around” 64 pence per pound. This should mean, in theory, that for every pound spent on research councils (and inter-UKRI activities) between 2022/23 and 2024/25, QR funding should receive around 64%.

While this commitment is welcome, there will be an opportunity in the run-up to the next spending review to argue for a further increase in the RQ given that the funding stream was worth 80 pence in the pound in 2007 and has declined in real terms since then. This will be crucial in supporting the financial resilience of the UK’s research base and achieving the government’s science superpower ambitions.

The elephant in the room

The allocations made on Monday were set in the absence of a decision on the UK’s association with Horizon Europe. In this vacuum, there is a lot of uncertainty, particularly around UKRI’s plans for talent and spending on global collaborations.

SHAPE subjects (Social Sciences, Humanities and Arts for People and Economics) in particular depend on EU funding for their support, given the relatively small size of their councils, and UKRI will need to consider how to support these strategically important disciplines if plan B is implemented.

Overall, however, the outlook is positive. All UKRI councils will have their budgets increased over the next three years. Although funding is tighter for the start of 2022/23, Monday’s allocations signal that improvements across all councils are underway.

The new allocations also signal another positive change – a reduction in funding for the Industrial Strategy Challenge and other National Productivity Investment Fund allocations, which were heavily controlled by the Treasury. The way funding has been allocated for this spending review period is quite different – ​​and is designed to give UKRI much more freedom and autonomy in the future. Combined with UKRI’s new five-year strategy, this hopefully signals further evidence of confidence in the government’s main funder of research and development – and should put UKRI in a stronger position to approaching the next spending review.

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James V. Hayes