Budget 2020: huge promises for UK research, but the devil will be in the detail

How future governments view R&D investment will be impacted by this fresh injection of funding, writes Athene Donald 

March 12, 2020
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The UK’s new Chancellor of the Exchequer, Rishi Sunak, has given the higher education sector much to consider in his rapidly produced budget. There are certainly some headline figures involving mouth-wateringly large sums of money which look promising for a sector that has been stuck on a flat cash science settlement for years. However, as ever, the devil will be in the detail, and much of that detail will not become apparent until the autumn’s comprehensive spending review (CSR).

Equally, there are issues on which the budget is totally silent, which will remain of concern, notably the Augar Review and whether university fees will be reduced; we are merely told that the sector won’t be allowed to increase them.

The attention-grabbing figure that researchers will be most aware of is the very substantial increase in R&D funding, up to £22 billion a year by 2024-25. That sum represents even more of an uplift than promised in the Tory manifesto and includes an immediate £400 million rise to build “excellence” in research institutes and universities across the country, including for infrastructure and equipment.

The chancellor, needless to say, does not define excellence. It also includes an additional £300 million for experimental mathematical research, with a view to attracting global talent. 

The prior commitment was to raise R&D spending to 2.4 per cent of GDP by 2027. These promised figures suggest an even faster increase, reaching the magic 2.4 per cent figure a couple of years ahead of the manifesto promise.

However, to achieve this figure overall as a percentage of GDP does also rely on huge increases in private sector funding. To facilitate this, tax credits for companies are being modified, but whether that in itself will be sufficient to release the required great injections of cash into their own research and innovation spend we cannot of course tell. Given that the combined effects of coronavirus and Brexit are expected to cause a massive economic downturn, what GDP itself will look like in the short and medium term may be extremely unpredictable.

It appears that Dominic Cummings’ much touted wish for a Darpa-like organisation will be fulfilled, with such a body getting a cash injection of at least £800 million. This, it seems apparent, will sit outside the UK Research and Innovation structures, but how it operates and with what sort of mission is obviously not going to be covered in a budget statement. The community will have to wait to see what this really means for researchers.

For those wanting to know what our departure from the European Union will mean for research funds, little insight is provided. Indeed, the chancellor’s statement that “The government may also choose to participate in certain EU programmes, where it is in UK interests and the contributions are fair and appropriate” smacks to me of the sort of cherry-picking that is likely to get a dusty answer from Brussels.

The Erasmus scheme gets no mention whatsoever in the budget. The loss of EU structural funds is, however, covered more explicitly by the creation of a new UK Shared Prosperity Fund to replace the “overly bureaucratic”, as the chancellor called it, EU money.

One final, uncomfortable fact relating to our imminent departure from the EU is that there will be an increase in the Immigrant Health Surcharge to £624 for every adult, one reminder that continuing to attract overseas researchers to our institutions may be a challenge.

That new UK Shared Prosperity Fund is part of the government’s commitment to levelling up, a phrase that appears about 20 times in the text without much concrete detail. Many parts of the country will welcome this, although the cynic might spot that the three institutions mentioned explicitly to get part of the additional £80 million (over five years) to be allocated to foremost specialist institutions are all London-based. Personally, I’m not going to complain that the Oxford-Cambridge Arc gets a specific mention, but others might not feel the same.

Levelling up is definitely seen to be linked to increased productivity via upskilling the population. There is mention of additional money to promote lifelong upskilling, plus £1.5 billion to invest in further education colleges’ buildings and facilities.

More money for the new industry-linked T levels is also identified. All this money will be important to support those for whom university is not their aspiration. These people are highly significant when it comes to achieving future productivity growth, not to mention the private sector’s ability to deliver this.

Indirectly, this means that how the governments of tomorrow view R&D investment in general will be impacted by outcomes from this fresh funding. Consequently, university leaders should definitely care about these investments into education-related activities outside their own sphere.

So, overall, it’s a budget with huge promise for the sector, but inevitably leaves many unanswered questions. The autumn CSR will tell us much more about how the headline figures translate on the ground.

Dame Athene Donald is master of Churchill College at the University of Cambridge.

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