UK research to be ‘transformed’ by ‘enormous’ spending rise

The UK government’s plan for an “enormous” increase in research investment to £22 billion a year will “transform the shape and scale of the research base” but will require “substantial expansion” in capacity in many regions to deliver promised geographical rebalancing, experts said.

The Budget, delivered by new chancellor Rishi Sunak on 11 March, combined a commitment to support “world-leading research in all regions and nations of the UK” with a hint at also expanding capacity in the nation’s biggest research and development powerhouse, the Cambridge region, via a new town.

The Conservative manifesto had said that the government would double research spending from £9 billion to £18 billion a year by 2024-25. But Mr Sunak, who said that the nation must “invest in ideas” to “compete and succeed”, pledged that spending would hit £22 billion by 2024-25.

“This will transform the shape and scale of the research base in the UK,” said Graeme Reid, chair of science and research policy at UCL, formerly responsible for the government research budget as a senior civil servant.

“For years this country has underinvested in R&D,” he continued. “Our exceptionally strong performance has been achieved by persistent focus on proven performers. Now the UK can multitask: supporting our largest research institutions while developing exciting new research clusters in more parts of the country.”

The research community has long argued that “research and innovation have the potential to raise productivity” and it is “now being asked to deliver”, Professor Reid added.

The government had previously committed to raising combined public and private spending on R&D to 2.4 per cent by 2027.

The Budget – which also extended research and development tax credits for private investment – in effect brings that target forward to 2025, said Richard Jones, a University of Sheffield physics professor and expert on research policy. This is “an enormous increase over a short timescale”, he said.

But it was unclear where the extra spending will go, as the specific sums detailed in the Budget were relatively small, Professor Jones noted.

The Budget committed to an immediate £400 million in research spending for 2020-21, with “much of that funding going to brilliant universities around the country” in the regions, said Mr Sunak.

That sounded like extra funding for UKRI’s Strength in Places Fund, which supports local economic growth, said Andy Westwood, professor of government practice at the University of Manchester.

Mr Sunak also confirmed a budget of “at least” £800 million for a new blue-sky research agency, a UK version of the US Defense Advanced Research Projects Agency championed by Dominic Cummings, the prime minister’s most senior adviser.

Professor Jones, whose paper calling for a rebalancing of research investment to the UK region has been praised by Mr Cummings, said that the key issue on the far larger overall spending increase is “one of capacity – where in the system can such large sums be absorbed?”

The Budget, in its reference to “plans to explore the case for a new town at Cambridge”, looked at “relaxing some of the infrastructure and planning constraints that limit further growth in the Golden Triangle”, Professor Jones said.

But to meet the pledge to support research in all regions, there will “have to be a substantial expansion of R&D capacity in those regions whose R&D intensity – and productivity – is low,” he added.

Professor Jones’ paper argues the case for using “new translational research institutions as nuclei” to build local and regional innovation systems, highlighting Sheffield’s Advanced Manufacturing Research Centre as a role model.

“I’d look for where existing capacity – both public and private sector – already exists, and I think translational research/AMRC-type institutions will need to be a big – though not the only – part of the answer,” he said.

The Budget documents say that at the autumn spending review, “the government will examine how R&D funding as a whole can best be distributed across the country to help level up every region and nation of the country”.

Meanwhile, the Treasury is considering whether to reclassify expenditure on human capital, including education, as investment rather than current spending, which would allow greater freedom for spending in those fields.

Mr Sunak said that the government would consider in the coming months “the best ways to measure productivity-enhancing investment in the economy, such as human capital, or measuring value on the public balance sheet”.

Professor Westwood said that any change here should not be seen as a “magic bullet” and would result in a “different set of trade-offs” between education and other fields deemed as investment. As with the continuing issue of the accounting treatment of student loans, “it shouldn’t be the relatively arbitrary fiscal rules that drive the policy”, he argued.

john.morgan@timeshighereducation.com