University research and development received a significant boost in this week's budget with measures aiding higher education institutions and the private sector.
Top among Chancellor Gordon Brown's announcements was a Pounds 15 million increase in the Pounds 50 million University Challenge Fund. Mr Brown revealed that there would be a second round of the fund which is designed to help universities commercialise research. Two-thirds of the new cash will be used to kick-start the second round.
Mr Brown also confirmed a Pounds 100 million fillip for the Joint Infrastructure Fund, which is to replace outdated university research equipment and buildings. This funding council cash was announced last year in the comprehensive spending review. It is on top of the existing Pounds 600 million JIF scheme, half of which comes from public funding and half from the Wellcome Trust.
The budget brought good news for young high-tech companies, including many university spin-offs. They will be able to bid for a Pounds 20 million venture capital fund. The aim is to create regional funds providing companies with seedcorn money to develop and market ideas and products. In addition, small and medium companies were given a Pounds 150 million tax credit encouraging investment in research and development with potentially significant benefits for research-active universities.
The tax credit could cut the costs of investing in research by 12.5 per cent for profitable companies and 24 per cent for those making a loss.
Announcing details of the University Challenge Fund bonus, science minister Lord Sainsbury said that Pounds 5 million of the Pounds 15 million would go immediately to increasing the size of the fund for the competition's first round, bringing the total to Pounds 45 million from non-university sources.
Lord Sainsbury said that 15 university consortia, covering more than 30 universities, had been successful in the first round. Each won between Pounds 1 million and Pounds 4.5 million to establish seed funds to finance early commercial developments of business ideas.
The highest winners were the universities of Leeds, Sheffield and York (White Rose Consortium) which netted Pounds 4.5 million, as did a joint bid by the University of Manchester and UMIST. Bath and Bristol got Pounds 3.75 million.
Save British Science welcomed the boost to University Challenge. "The scheme is still modest," said Peter Cotgreave, director of SBS. "But every little helps."
The chancellor also announced that Individual Learning Accounts (ILAs), offering a million people Pounds 150 from next month in return for a Pounds 25 individual contribution would be enhanced thanks to regulations making employers contributions to the accounts tax deductible. ILA holders will be eligible for a 20 per cent discount on approved education courses costing up to Pounds 500. They will also be eligible for an 80 per cent fees reduction for basic skills and computer literacy courses.
A Pounds 1.7 billion fund is to fund 1,000 computer-learning centres in colleges and communities.