Medical transfusion won’t save BIS from further bleeding

Source: Corbis

Clinical decision: the Department for Business, Innovation and Skills is expected to make budget cuts, but how deep is not yet clear

The transfer of £875 million in the medical education and research budgets to the Department of Health to meet spending review targets would be a “box-ticking exercise”, according to Labour’s shadow universities and science minister.

And it would leave further savings of up to £500 million still required from the Department for Business, Innovation and Skills’ budget, exposing widening participation funding to cuts, sector figures fear.

As the 2015-16 spending review looms, there have been positive signals from the chancellor, George Osborne, that the science and research ring-fence will be maintained.

As Times Higher Education went to press, 13 government departments had reached an accommodation with Mr Osborne and accepted cuts of between 8 and 10 per cent as part of the government’s continuing austerity programme.

But BIS was not among the departments to have settled as it followed a tactic of holding out until the 11th hour of the negotiating process.

The exact 2014-15 budget baseline from which BIS is expected to cut is itself under discussion and is thought to range from £13 billion to £14 billion. Cuts of between 7 and 10 per cent are thought to be on the table.

Depending on the baseline and the level of retrenchment, the 2015-16 saving required from BIS would range from a best-case scenario of £910 million to a worst-case scenario of £1.4 billion.

As THE reported last month, a plan is in place to secure some of those savings by transferring medical education and research budgets totalling an estimated £875 million from BIS to the Department of Health – a protected department not required to make cuts under the spending review, which is scheduled to be unveiled on 26 June.

In the House of Commons on 13 June, David Willetts, the universities and science minister, was asked by his Labour shadow, Shabana Mahmood, if he would pledge to keep the Medical Research Council budget under BIS control “to ensure that it remains free of political interference”.

But Mr Willetts said he could “do no better” than repeat assurances from Mr Osborne “that we will make sure that the money is not used for other things, and that if there is any change the vital, basic research that the MRC carries out is not jeopardised”.

Ms Mahmood told THE there were “concerns that this move is being motivated simply as a box-ticking exercise to hit departmental spending targets as a result of the government’s failed economic plan”.

Even after the medical transfer, BIS may still need to save up to £525 million. The department may leave it to the Higher Education Funding Council for England to identify areas for the chop, having told it how much will need to be saved.

However, “student opportunity” funding attached to poorer students – designed to widen participation and improve retention – is likely to be cut, although not scrapped entirely.

The money, which benefits mainly post-1992 universities with higher numbers of disadvantaged students, amounts to £332 million for 2013-14 and will form the largest chunk of the remaining teaching grant when the new fee regime is fully operational.

Borrowed time?

Stories have also appeared in the national press about the possible sale of the student loan book and proposals to change repayment terms for borrowers. However, Vince Cable, the business secretary, said he had “ruled out categorically” any change in terms for loans taken out before 2012, although this may leave some to speculate that the coalition is still considering changes for post-2012 borrowers.

Such possibilities reportedly have featured at some stage in talks between the Treasury and BIS, although how they relate to the spending review has been unclear.

Mr Osborne seemed to hint at keeping the science ring-fence when he appeared at the topping-out ceremony for the £700 million Francis Crick Institute in central London earlier this month. Asked by THE whether he was prepared to cut some of the few remaining substantial parts of the higher education budget, such as widening participation, in order to preserve science, Mr Osborne said the deficit meant “difficult decisions…to ensure this country lives within its means”, including choices such as the previous decision to protect science.

“I think my intentions [on prioritising science] have been…self-evident,” he added.

Libby Hackett, chief executive of the University Alliance, said she would “strongly advise” the government not to cut widening participation and retention funding, particularly given that the coalition has “tied itself so closely to social mobility”.

Hefce’s student opportunity funding “is the only part of the WP pot that is targeted towards genuine additional costs”, she said, citing the evidence for extra expenses incurred by institutions that teach large numbers of non-traditional students.

john.morgan@tsleducation.com