UK universities ‘block funding bids’ because of overhead costs

UCL vice-provost warns that universities' ability to cross-subsidise grants is declining

June 18, 2019
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Leading UK universities are telling researchers not to apply for some streams of research funding because they can’t afford to pay the associated overheads, a senior academic has claimed.

David Lomas, vice-provost (health) at UCL, told the House of Lords Science and Technology Committee that the real-terms fall in quality-related funding meant that universities were less able to complement grant money with central funds, and less able to cover overheads such as infrastructure, facilities and training.

The shortfall was likely to be exacerbated by the proposed reduction in tuition fees in England, said Professor Lomas, head of the UCL Medical School.

“Some universities around the country – and I won’t name any names – are actually stopping academics applying for certain grants because the overheads and the recoveries are not high enough to cover the central costs,” Professor Lomas told peers.

“I have never done that and I won’t do that because it is so opposite to my values…but other major universities that you will have heard of have actually asked their academics to stop applying for certain funding streams. And I think that’s really dangerous for this country.”

Transparent Approach to Costing (Trac) data show that, for every £1 received in funding from the UK’s public research councils, universities contribute 28 pence to cover overheads. Even greater contributions are needed for funding received from the European Union and charities.

Speaking to Times Higher Education, Graeme Reid, chair of science and research policy at UCL, agreed that it was “no secret that university research is loss-making”. That universities were stopping researchers from making funding applications was something he knew of, he said, but “there is no qualitative data to show for it”.

“The big challenges come in the overheads for funding from the EU,” he added. ERC grants typically only cover two-thirds of the total cost of research, for example.

“Universities have different approaches to finding that missing third, but cross-subsidisation of funding from other areas is not rocket science,” Professor Reid continued. “One of the ways in which universities compete is by finding better ways to do that.”

However, as university resources tighten and institutions prepare for a potential loss of income from the post-18 education review’s recommendation for a cut in fees, it was plausible that leaders may look to new and more extreme methods of saving money, he warned, particularly if the lost income was not made up by the Treasury in full.

“It’s fair to say that with UK Research and Innovation budgets increasing and university finances falling, we could see a pattern whereby more researchers are encouraged to go for UK grants over more expensive EU or charity grants,” Professor Reid suggested.

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Reader's comments (1)

The same old cliches from people whose use accountancy techniques as gospel, rathr than simply adding up and taking away. The huge fuss that universities - including UCL - are making over losing EU funding is completely contrary to statements made in the article. Any sane business would stop making a product that lost money, rather than keep on selling it to improve world status rankings. And - generally the same - universities claim they are making a loss on teaching. Which begs the question - if teaching and research are both loss making - how do universities stay afloat? We all know the 'answer', which lies in flawed logic. By amortising fixed costs of administration across a variable rate of teaching and research income, you can 'prove' either is loss making. The logical answer, then, is to stop both. Now, despite a fixed administration cost, the universities should break even, despite having zero income. A good job the accountants are not in charge of everything.