Higher Education

My Lords, I thank my noble friend Lord Luce for initiating this debate. This is a very timely topic and has generated tremendous interest in the House and the community. I declare an interest as a past professor of chemistry in a number of universities in the country. As a result of that, I would like to concentrate on some aspects of the funding of science, both past, present and future, in universities. As the noble Lord, Lord Broers, pointed out, there has been a significant increase in the projected funding of science in universities. Over the next four or five years, this is to be in the order of 17 per cent. However, a recent report by the Select Committee on Innovation, Universities, Science and Skills in the other place pointed out that, although the budget has increased, it does not cover all the spending commitments imposed by the Government during this period. It does not cover some of the spending commitments already agreed, for instance the 80 per cent of the full economic cost of research. It also involves the potential closure of some of the facilities run by research councils. These are very perturbing features. I believe the full economic funding of research work in university departments to be a significant and desirable change in the funding programme. But as the Royal Society of Chemistry has pointed out, the way research costs are being assessed has led to a number of industrial firms, particularly pharmaceutical companies, slashing their support for research in university departments of chemistry. The figures they quote indicate a drop of 25 per cent in the number of postdoctoral grants. I do not find it surprising that an increase in the cost of research has led to this reduction in funding, but the Royal Society of Chemistry suggests that a major factor in this reduction has been the introduction of full economic costing. This change in the funding pattern has been introduced over the past two years by the Government to allow universities to recover indirect costs from projects, such as academic staff time, the use of various instrumental facilities, and library, building and rental support services. I believe it is fair that these factors should be included in any assessment of research sponsored in a university—it has been one of the ironies of the funding of science in universities in the past that they have not been included—but it leads to problems in other general areas. The figure suggested by the research council for projects sponsored by industry is 80 per cent, but some universities appear to be charging as little as 10 per cent or as much as 120 per cent. Certain charitable funding organisations have also been subjected to these extra costs, but as they are unable to pay them, often for very legitimate reasons, some universities are refusing to accept grants from those bodies. This reflects how dependent universities are on this funding to run their science departments. It is important that the Government address the problems at the interface between universities and industry if we are going to have a healthy relationship between the two, as well as the position with charities. A further problem occurs with EU framework funding, where the figure of 80 per cent will not apply. The Government should address this problem. We must avoid the chaos that ensued from the funding programme for one of the previous frameworks. Here the percentage was minimal compared with the one given by other organisations. One of the consequences of this funding is that it influences other aspects of universities. There is a suggestion, for instance, that recruitment is being associated with people’s potential to raise money. It is also possible that less funding is directed to blue-sky research. The noble Lord, Lord Broers, referred to the recent paper by the noble Lord, Lord Sainsbury, The Race to the Top, but there is little doubt in my mind that blue-sky research is a fundamental factor in the progress of universities in this country.