Research councils want more government funds to attract postgraduate students from other European Union countries amid growing evidence of a domestic recruitment slump.
The research councils and ministers are discussing what the United Kingdom provides to support foreign researchers who want to do doctoral studies here.
There are worries that the anticipated economic downturn could affect the amount available. Hopes are being pinned on the 2002 comprehensive spending review even though the government has stated that its priorities remain undergraduate expansion and financial support.
Universities have been called on to change their attitudes to research careers amid concerns that too few home students are choosing to do the sort of postgraduate research that leads to an academic career.
An interim report from the Research Careers Initiative group, ordered by science minister Lord Sainsbury, says that personal development is being ignored. It says there must be honesty in distinguishing between high-fliers en route to academic careers and those who would have a limited research career after their PhD.
The RCI strategy group, chaired by Sir Gareth Roberts, is due to report next year at a major conference involving funding councils and the Wellcome Trust.
Higher education minister Margaret Hodge said last week that postgraduates should be encouraged to teach in schools. "In some socioeconomic groups, 44 per cent of young children have not heard of university. Having postgraduates in schools would help overcome that," she said.
Some research councils and academics believe that it is not schools but universities that need more postgraduates, fearing serious lecturer shortages in some subjects.
Iain Cameron, head of postgraduate training for the Engineering and Physical Sciences Research Council, said: "There are disciplines where the age distribution of academics is such that there are retirements, and there will be replacement issues. We want the government to put in enough money to allow all EU students full minimum stipends."
The EPSRC gives postgraduate students a minimum of £7,500. But students can receive this only if they have lived in the UK for three years or more, excluding time spent studying.
At this week's Liberal Democrat conference in Bournemouth, Lord Wallace, professor of international relations at the London School of Economics, said the problem of poor postgraduate recruitment was a result of low pay for researchers and academics.
He said: "We are solving it at the moment by recruiting more people from abroad. My department has just appointed a British person, and I think it's the first British appointment in six posts."
The RCI's third interim report says progress is being made on postgraduate recruitment but that more needs to be done quickly. It says the management of contract research staff must be improved so that they are treated as an integral part of the institution's wider human resources. It suggests that titles such as "contract research staff", "post doc" or "research assistant" are demeaning and should be replaced with the title "research fellows".
The current funding system for postgraduate studies also denies poor students access to masters studies, according to the National Postgraduate Committee.
The NPC says that the student loans scheme should be open to postgraduate students.
Chinese solution to lack of funds for postgrad
David Stone had hoped to study for an MSc in project management. He took an access course and completed a degree in archaeology at Newcastle University as a mature student.
"After successfully completing my degree, I was filled with a sense of achievement and self-belief that I had never experienced," said Mr Stone, who spent most of his childhood in care.
With a family to support, Mr Stone decided to take an MSc to improve his employability. "I was stunned to discover there is no funding available for postgraduate studies," he said. His credit rating barred him from a career development loan.
Mr Stone has now given up on the idea of an MSc and is going to teach English in China instead.