The UK is not alone in trying to find the best way to fund and carry out research. The Times Higher looks at how other countries are tackling the problem.
An international survey ranked New Zealand scientists first in the world in terms of papers published per dollar spent. That is something to crow about, says Steve Thompson, chief executive officer of the Royal Society of New Zealand, but it is also a "rueful comment" on the amount of money available.
Most science money comes from the Government. Private research and development spending lags at about a third of the Organisation for Economic Cooperation and Development average, at 0.42 per cent of gross domestic product. It has increased in the past few years, from 0.33 per cent in 2000, but Pete Hodgson, Science Minister, said increasing it was his "most important policy challenge".
Don Smith, the Royal Society of New Zealand's research funding manager, said the problem was that industry wanted a competitive advantage. "New Zealand companies are small and what they can afford doesn't buy much research," he said.
This is where the nine Crown Research Institutes fit in. They are state-owned businesses that focus on applied and strategic research, in particular in economic and natural resource sectors.
But, unlike universities, which can rely on per-student funding for a substantial amount of income, the CRIs stand or fall on their success in winning Government funding.
This lack of long-term financial stability has led to the loss of experienced scientists. It may also make it harder to attract top researchers from overseas.
These risks were recognised to some extent this year, when the Government decided to reprioritise a small proportion of its funding to help maintain strategically important capabilities.
Discussions are under way on whether to move to a system that might allocate as much as 80 per cent of CRI funding through such broad-brush programmes.
But universities would not like such a change as it would, in effect, shut them out of a large pool of external income. An emphasis on "strategic" funding is another source of friction within the science community.