The elite research-intensive universities could lose significant amounts of their research funding to teaching-focused universities after the results of the research assessment exercise last month.
This is the fear of vice-chancellors in the large research-led Russell Group of universities after the 2008 RAE highlighted "world-leading" (4*) research right across the sector - including in post-1992 institutions and some that were awarded university status only in the past two or three years.
The RAE, which for the first time showed the "research profile" of every department instead of providing a summative grade, found at least some world-leading research, often in small pockets, in 150 of the 159 universities that entered. Overall, 17 per cent of all the submitted work was found to be 4*.
It was predicted this week that however the UK's funding councils translate the results into funding allocations, the money available for research will be spread much more thinly than after the 2001 RAE.
One vice-chancellor, who wished to remain anonymous, described the possible funding changes as "potentially the biggest shift in research funding policy for 20 years".
"What is happening is that it looks like the end of the road for research concentration," he said.
The funding allocations will not be known until early March, but already vice-chancellors are predicting that the current situation, in which a small elite of universities receive the bulk of available funding, will change. The problem is compounded by the fact that 12 per cent more staff were entered into the 2008 RAE than the 2001 exercise.
In February 2008, John Denham, the Universities Secretary, implied that he was content with the current concentration of research activity in universities, which he saw as part of the reason for the internationally recognised success of Britain's research.
"I am in no doubt that our world-leading position - and our ability to sustain institutions that are world class across a wide range of disciplines - depends on an appropriate concentration of research effort," he said.
He reiterated his support for the current distribution of cash, which sees 23 English universities receive three quarters of the quality-related research (QR) funds distributed by the Higher Education Funding Council for England.
Eric Thomas, vice-chancellor of the University of Bristol, told Times Higher Education that while the RAE league tables looked much the same as at the previous RAE, it would be a mistake to assume that funding allocations would stay the same "because in 2008 it is clear that 4* work is found in many places".
"If you are going to fund it all (4* research), there will probably be less money for the top end. Once you aggregate lots and lots and lots of small amounts of funding everywhere, the quantum could be large enough to impact on that available for research-intensives," he said.
Malcolm Grant, provost of University College London and chairman of the Russell Group, agreed. "There will be a tension between being able to fund the world's top institutions at a level that will allow them to remain the world's top institutions and (at) the same time reflecting improvements elsewhere," he said.
Pockets of excellence
Sarah Worthington, pro-director for research at the London School of Economics, agreed that pockets of excellence found in teaching-focused universities could reduce the pot available to big institutions.
"If the funding follows quality - as it should - then the research-intensives could see a drop in their share of QR resources," she said.
Hefce will begin to develop its funding formula to translate the RAE results into cash this month after its total funding levels are confirmed in the annual government grant letter.
On the one hand, Hefce will be keen to ensure the long-term stability of the research base, which means preserving the status quo. But on the other, the whole point of the exercise is to fund excellent research wherever it is found.
Brian Cantor, vice-chancellor of the University of York, said finding a formula that worked would be a "fiendish problem".
"To put it crudely, there has to be an algorithm that has some degree of logic in its structure, but at the same time does not destroy Oxbridge and doesn't give absolutely nothing to the 'University of Giggleswick'," he said, adding that it was those institutions in the middle that he feared would suffer the most.
"The only way that Hefce can work it is by sharpening up the selectivity ... So I expect departments that have significant numbers of 4* will do well while those at the bottom that had managed to score some 4* research (will) not do badly."
Pam Tatlow, chief executive of the Million+ think-tank, which represents post-1992 universities, said that if the funding councils were looking to build on performance across the sector with funding allocations, it was "almost inevitable" that there would be some moderation of the current concentration of resources.
She said it was "entirely unsurprising" that those institutions that received so much QR funding after 2001 should do so well in 2008, but added that while their research was to be celebrated, there should not be a "closed shop" on funding.
"In areas where other universities, including post-92 institutions, excel, it is crucial that they get realistic amounts from the QR pot to build their research infrastructure and the UK's research capacity ... (4*, 3* and 2*) research must be funded wherever it is found in the sector."
David Maguire, pro vice-chancellor at Birmingham City University, said he looked forward to seeing the university's funding increase as a result of the RAE.
"There is one school of thought that says that all the money should be concentrated in a relatively small number of institutions, irrespective of their capabilities and portfolio, and there is an alternative school of thought that says that wherever excellent research has been identified then it should be funded ... The world is not fixed, and we need to move with the times."