Science Research Funding in Universities (Science and Technology Committee Report)
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The Parliamentary Under-Secretary of State, Department for Business, Energy and Industrial Strategy (Lord Callanan) (Con)
My Lords, I am supremely grateful to the noble Lord, Lord Patel, for securing this important debate and for the excellent contributions made by other Members, demonstrating once again the wide range of expertise that exists in this House. I also thank the committee for its inquiry and report, and for raising the important issues affecting science research funding in universities.
I also pay tribute to the universities themselves, which have played and continue to play a vital role in the national response to Covid-19. If I may offer a few examples, we have seen our world-class science and research base in universities across the UK support our Vaccine Taskforce by working tirelessly to research a vaccine for coronavirus. It is thanks to their valuable medical and research expertise that vaccine candidate clinical trials are now taking place at the University of Oxford and Imperial College London. I take a moment here to echo the strong praise of the noble Baronesses, Lady Deech and Lady Walmsley, for the outstanding work of these two world-leading institutions.
In addition, universities have offered vital services such as lab space and accommodation, applying research capabilities to develop the medicine and equipment needed to combat this terrible virus. Many have also repurposed their facilities to carry out testing on those with coronavirus symptoms, and collaborated with industry partners in producing ventilators, PPE and testing equipment for our National Health Service. As of 13 August, UKRI has committed more than £95 million to new research aimed at tackling Covid-19. It has also repurposed research grants of around £80 million to address the effects of the pandemic.
The UK’s world-class universities will continue to play a critical role in delivering local and national economic prosperity, but of course they have been hard hit by Covid-19. That is why we have announced a range of measures to support universities at this difficult time. We have established a joint BEIS-DfE ministerial taskforce on the sustainability of university research, to identify and assess the risks and impacts of Covid-19 on universities and to consider approaches to help manage these risks. A reprofiling of quality-related research funding in England also brought £100 million forward as a short-term measure to help to safeguard university research and as a reassuring signal to the research sector. Some £280 million of funding will sustain UKRI and national academy grant-funded research and fellowships affected by the Covid-19 pandemic.
In sharing responsibility for the future of science and research with our world-leading university system, from the autumn the Government will provide a package of grants and low-interest loans through the sustaining university research expertise fund, or SURE, to cover up to 80% of a university’s income losses from international students for the academic year 2020-21, up to the value of their non-publicly funded research activity. The noble Baroness, Lady Walmsley, the noble Lord, Lord Turnberg, and other noble Lords highlighted the importance of research funding from charities and the impact of Covid-19. Ministers in BEIS and the Department of Health and Social Care have met the Association of Medical Research Charities. Officials continue to engage regularly with the AMRC to discuss these issues and the challenges that the sector faces. The SURE fund aims to help sustain the research capacity of the university research base as a whole. Universities will be asked to demonstrate how they will use that funding to sustain research in areas typically funded by charities and business. Ultimately, we want critical university research capability, including charity-funded medical research, to be sustained and able to contribute to our future R&D ambitions.
We have also announced the pulling forward of an estimated £2.6 billion-worth of forecast tuition fee payments to ease cashflow pressure this autumn. This is on top of the unprecedented package of support for which higher education providers are eligible, previously announced by the Chancellor, such as the Coronavirus Job Retention Scheme and a range of business loan schemes.
In addition, in July, the DfE also announced the establishment of a higher education restructuring regime for those institutions at risk of financial failure. This regime can be deployed as a last resort if a decision has been made to support a provider in England, when other steps to preserve a provider’s viability and mitigate the risks of financial failure have proved insufficient.
Last month we published our R&D road map, which my noble friend Lord Willetts rightly highlighted as a key document, to ensure that the UK is the best place in the world for scientists, researchers and entrepreneurs to live and work, while helping to power up the UK’s economic and social recovery and level up the UK, which the noble Lord, Lord Shipley, rightly highlighted as a key part of the Government’s agenda. The road map builds on the ambitious commitment set out in the Budget to increase public spending in R&D to £22 billion by 2024-25. I therefore assure the noble Baroness, Lady Young, that this puts the UK on track to reach 2.4% of GDP being spent on R&D across the UK economy by 2027.
Through the road map we will test in detail how we can increase our investment in research, unlocking new discoveries and applying research to solving the most pressing problems in government and industry, and across society. In the longer term, we will review how we fund and assess discovery and applied research to cut unnecessary bureaucracy, pursue ambitious “moon shots”, and ensure that institutional funding and international collaboration can support our ambitions. I also assure the noble Lord, Lord Patel, that we are working with a wide range of stakeholders, including universities, to develop the proposals in the road map into a comprehensive R&D plan.
We also recognise that research and innovation are global endeavours, as the noble Lords, Lord Triesman, Lord Mair and Lord Bilimoria, all rightly emphasised. Our aim is to sustain, improve and grow opportunities for international collaboration. Our R&D road map sets out our wider ambition and the steps we will take to deliver this goal, including our relationship with Europe and the next EU research and innovation framework programme, Horizon Europe.
The noble Lords, Lord Patel, Lord Mair, Lord Bilimoria and Lord Shipley, and my noble friend Lady Bottomley all raised points on Horizon Europe and international partnerships. Let me reassure them that fostering international partnerships and global collaboration will play an important part in helping to achieve our ambitions to make the UK the international partner of choice for cutting-edge scientific and research discovery. We have made it clear in the road map that we aim to maintain a close and friendly relationship with our European partners, seeking to agree a fair and balanced deal for participation in Horizon Europe and Euratom research and training programmes.
The noble Lord, Lord Triesman, asked what conditions would prevent association with Horizon Europe. The Government have set out that any agreements relating to Union programmes should contain fair terms for UK participation. This should include fair treatment of participants, a fair and appropriate financial contribution, provisions allowing for sound financial management by both parties, and, of course, appropriate governance and consultation. We will make a final decision once it is clear whether such terms can be reached.
The noble Baroness, Lady Finlay, asked about alternatives to the Horizon programme. As a responsible Government, we are developing alternative schemes to support international research and innovation collaboration, in tandem with the Horizon Europe negotiations. If we do not formally associate with Horizon Europe, we will quickly implement ambitious alternatives as soon as possible from January 2021 and therefore address the funding gap.
We know that universities value research collaboration with the EU and beyond. We are grateful to universities for their ongoing policy insight and engagement with government, including convening round tables for the Smith-Reid review, which considered the future funding landscape, including our relationship with EU research and innovation funding.
Alongside international co-operation, we also want to send a global signal that the UK welcomes scientists and researchers. Our new global talent visa will help this skilled cohort of individuals to access the UK, empowering them to significantly enhance our knowledge base and make critical contributions to scientific and medical research.
The noble Baroness, Lady Randerson, my noble friends Lord Willetts and Lord Kirkhope, and the noble Lord, Lord Rees, all raised the important issue of attracting talented graduates to the UK. We have announced changes to the graduate route to make it easier for some of the best young international graduates to secure skilled jobs in the UK and contribute to our economy and society. The noble Lord, Lord Bilimoria, rightly raised the contribution of international students to the UK. That is why the Government are offering those who complete a PhD from summer 2021 a three-year visa after study to live and work here. Students who have successfully completed undergraduate and master’s degrees will be able to stay for a further two years following their studies.
These reforms are just the start. We will now radically improve our approach to attracting global talent to the UK by setting up a new Office for Talent. This will make it significantly easier for top global science, research and innovation talent to come to the UK and make it their home.
Over the coming months, we will work with the devolved Administrations and key stakeholders, including the major funders of research such as UKRI and the national academies, to develop a comprehensive new R&D people and culture strategy.
Looking ahead to the spending review, we will set out details of this historic investment for our universities. As the noble Baroness, Lady Morgan of Huyton, suggested, this will be critical in giving our researchers and innovators the confidence that they need going forward. I can reassure the noble Lord, Lord Watson, that the Chancellor launched the 2020 comprehensive spending review in July, and it will be published in the autumn.
The noble Lord, Lord Patel, raised an important point about improving the financial resilience of universities and adjustments to QR funding. As part of the spending review and taking advice from UKRI, we will consider the scale and balance of funding for university research and innovation, including funding for QR, and will take financial sustainability issues into account. We will continue to look at the balance of dual support for universities and the role of QR, and we will work with other funders to consider what proportion of the full economic cost of research projects in universities they should be funding.
The R&D road map also sets out our ambition to develop a new compact between government and universities in England which could strengthen accountability for discretionary funding, potentially bringing together existing separate higher education research concordats and reducing bureaucracy for institutions and their staff. It also highlights our commitment to research culture, research integrity and open access to research.
Many excellent points were made during the debate and a number of questions were posed. I hope that noble Lords will understand that it is impossible for me to respond to all of them, but I will go through as many as possible in the available time and hope that noble Lords will accept my apologies if I do not get around to their particular point.
The noble Lord, Lord Patel, asked when the Government intend to publish the terms and conditions of the SURE fund. I can assure him that work continues on the university research support package, with officials working closely with the sector to ensure that the fund is in place by the winter. We hope to share more details with universities in due course, including guidance on how they should apply as well as the terms of the loan. I can also reassure the noble Lord that the SURE fund will provide funding which is in addition to the £280 million announced in June for costed grant extensions from UKRI and the national academies.
Along with the noble Lord, Lord Shipley, and the noble Baroness, Lady Morgan, the noble Lord also raised the issue of the Government’s place-based strategy for research. We are engaging widely with industry, universities, the research community and civic organisations from across the country to help develop an ambitious place strategy for R&D that supports the priorities of areas and communities across the United Kingdom.
My noble friends Lady Bottomley and Lord Kirkhope, the noble Baroness, Lady Warwick, the noble Lords, Lord Shipley, Lord Watson and Lord Bilimoria, and others asked about the Government’s ongoing discussions with the European Union surrounding Horizon 2020. I can tell noble Lords that we aim to maintain a close and friendly relationship with the European Union to participate in the next generation of European research and innovation programmes starting in 2021—that is, both Horizon Europe and Euratom R&T. Negotiations with the Commission are constructive and we are open to participation but, as I said earlier, only if we can agree a fair and balanced deal.
The noble Baronesses, Lady Randerson and Lady Walmsley, and my noble friend Lord Willetts asked me about high visa costs. The Government recognise the importance of a vibrant and successful science, research and innovation sector to the UK’s continued prosperity, and acknowledge that attracting, retaining and developing research talent is at the heart of the R&D road map. We will look to build on existing initiatives by setting up the new office for talent, driving forward further visa reform by reviewing the uptake of different routes by established talent and those on the cusp of success, and reviewing the restrictions and costs that it brings about.
The noble Baroness, Lady Warwick, asked how we will stop the loss of early career researchers. Again, our R&D road map sets out the key commitments already mentioned to ensure that we attract, retain and develop top talent to ensure that the UK is the best place to work, offering careers at all stages that attract a diverse range of people.
The noble Baroness, Lady Finlay, referred to the shared prosperity fund. The 2019 Conservative manifesto committed to creating this UK shared prosperity fund, which binds together the whole of the United Kingdom, tackling inequality and deprivation in each of our four nations. The UK shared prosperity fund will be driven by domestic priorities with a focus on investing in people. At a minimum, it will match current levels of funding for each nation from EU structural funds.
In response to questions from my noble friend Lady Warsi, the noble Baronesses, Lady Walmsley and Lady Young, and others on the Augar review, we have considered the report and its recommendations carefully. We know that post-16 education has an essential role to play in driving economic recovery and future prosperity, so we plan to respond to the Augar report alongside the spending review. We are determined to pursue high-quality educational opportunities that meet our skills needs, fuel our economy and create world-leading outcomes for students.
As many noble Lords have commented, we are right to be proud of the strength of our research and innovation base and the quality of our universities. Research, innovation and knowledge are the drivers of our global competitiveness and a key source of economic advantage. I assure noble Lords that we remain committed to maintaining the UK’s position as a global science superpower, and that we will continue to invest in our universities and in the science and research that will deliver the long-term economic growth and societal benefits, that my noble friend Lord Griffiths of Fforestfach alluded to, enriching the UK for many decades to come.
Once again, I thank everyone for the learned contributions from many Members across the House, and I thank the noble Lord, Lord Patel, for securing this important debate.