Is there a catch to the UK’s £22 billion science spending pledge?

When Universities UK president Julia Buckingham wrote to prime minister Boris Johnson in March urging him to intervene personally to avoid an effective cut of more than £1 billion to the UK science budget, researchers’ cognitive dissonance over the government’s commitment to research spending reached a vertiginous peak.

In the Budget of 2020 – delivered in March, before the extent of the threat posed by Covid-19 had become clear – the government had committed to increase public spending on R&D to £22 billion by 2024-25 as part of its strategy to boost innovation-led growth post-Brexit. This figure is more than double the £9.5 billion spent in 2018, and is £4 billion more than was promised in the Conservative Party’s 2019 general election manifesto.

This “landmark investment is the largest and fastest ever expansion of support for basic research and innovation, taking direct support for R&D to 0.8 per cent of GDP and placing the UK among the top quarter of OECD nations – ahead of the USA, Japan, France and China”, the Budget Red Book enthused.

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Yet chancellor Rishi Sunak’s 2021 Budget made no provision for the funding of the UK’s association to the European Union’s Horizon Europe research funding framework, which, prior to Brexit, had been covered by the UK’s overall contribution to the EU budget. Voices across the sector were united in horror at the prospect of the sum (rising to closer to £2 billion later in the seven-year programme) having to be paid out of the mainstream science budget. According to Buckingham, the move would “be equivalent to cutting more than 18,000 full-time academic research posts…and lead to a further reduction of up to £1.6bn in private R&D investment which would have been stimulated by public investment”.

The outrage at the black hole in the Horizon Europe budget was particularly sharp given that the revelation quickly followed the announcement of 70 per cent cuts to the UK’s Global Challenges Research Fund (GCRF) as a result of the UK’s Covid-induced reduction to the overseas aid budget. The research cuts, amounting to £400 million, have resulted in many projects being cancelled before they had even properly begun.

In the event, the government responded to the sector’s howl of anguish by giving the Department for Business, Energy and Industrial Strategy (BEIS) – which administers the mainstream science budget – an extra £250 million for Horizon Europe participation, to be topped up by previously “unallocated funds” in the department. But while business secretary Kwasi Kwarteng subsequently called the government’s overall promise for total R&D spending to reach the OECD average of 2.4 per cent of GDP by 2027 “cast iron”, he said funding for Horizon Europe was only “fairly secure” and that he couldn’t “anticipate the spending review of 2021 or write the Budget for 2021-22 or 2022-23 [or] give a guarantee to every researcher in this country that their particular projects will be funded indefinitely”.

Alert to the risk of post-pandemic priorities shifting, the Wellcome Trust recently gave £1 million to the Campaign for Science and Engineering to – as CaSE’s chair, Bob Sorrell, put it – “build an environment where R&D investment has a level of public support consistent with the critical role it plays in delivering innovative solutions to the global challenges the UK faces across multiple sectors”.

Questions also remain about what the government will and won’t include in the £22 billion figure. The GCRF was itself the result of an austerity-era wheeze in the 2015 spending review to increase research funding while significantly cutting BEIS’ own budget and keeping to prime minister David Cameron’s legally binding pledge to spend 0.7 per cent of GDP on overseas aid. (This has now been reduced to 0.5 per cent). Some observers have questioned whether the sudden inclusion of the cost of Horizon Europe participation in the science budget might just be the start of a series of sleights of hand over the pledged spending increase. Might the government also move into the science budget other big-ticket items previously considered to be outside it, such as the Meteorological Office’s weather-forecasting supercomputers or satellites used by the Ministry of Defence?

According to John Womersley, a former chief executive of the Science and Technology Facilities Council, it is “unavoidable” that the cost of Horizon Europe participation will now be included within the £22 billion spending ceiling. Nevertheless, he says, that still leaves plenty of room for new activities. “Normally we’re talking about the least painful way to make cuts, or how to deal with [the last decade of] flat-cash settlements, so it’s good that we’re talking about some dramatic increases in R&D,” reflects Womersley, who was until recently director general of the European Spallation Source in Sweden. “For my whole career, there has never been enough money to do research, so this gives us an opportunity to think about what we’re not doing in the UK but need to.”

Womersley spoke to Times Higher Education before last week’s announcement of the latest R&D spending allocations. While the government trumpeted that its £14.9 billion spend in 2021-22 will be the "highest level in four decades", the year-on-year rise is largely attributable to the cost of Horizon participation being incorporated into that figure. Indeed, the budget for UK Research and Innovation, the mainstream funder of UK science, will actually decline slightly, from £8.2 billion to £7.9 billion, even when overseas development spending is excluded.

Ministers are also set on changes to how that funding is distributed. Following the Conservative Party’s big gains at the last general election in formerly Labour-supporting (and Brexit-voting) post-industrial regions, the government has trumpeted its “levelling up” agenda, designed to spread wealth more evenly around the UK.

The regional disparities are arguably reflected in the distribution of research funding, with the so-called golden triangle of London, Oxford and Cambridge popularly supposed to be hoovering up more than its fair share. This is because UKRI funding is currently allocated entirely according to the quality of grant applications and of research excellence framework submissions – and top scientists tend to be drawn to the golden triangle’s prestigious institutions.

“There is a real reluctance to dictate where research money goes and just to leave it to the system, but this has led to these huge imbalances,” says Womersley. He suggests incentivising some top scientists to spread themselves around the nation more evenly by allocating bulk sums to each region. “Why not just say, ‘£250 million a year must be spent on research in Newcastle and, as long as it’s high-quality stuff, we don’t care what it’s on,’” he proposes.

Meanwhile, an influential 2019 paper talked up by Dominic Cummings when he was Boris Johnson’s chief aide focuses on the UK R&D base’s particular weakness in “translational research and industrial R&D”. The paper, written by Richard Jones, a professor of physics at the University of Sheffield, proposes building levelling-up efforts around “translational research institutions” that play to existing local strengths while also “exploiting opportunities offered by new technology”. His example is the University of Sheffield’s Advanced Manufacturing Research Centre, which has attracted Boeing and McLaren to open adjacent new factories.

The precise funding mechanism the government intends to use is due to be set out in its R&D Place Strategy, promised for later this year. But however the money is distributed, universities must be the prime recipients, according to Brian Walker, pro vice-chancellor for research strategy and resources at Newcastle University.

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“We don’t have huge R&D bases for global corporations headquartered here in the north east, but we have thriving higher education institutes and space to expand,” he says, noting that his institution alone is responsible for 24 per cent of R&D spend in the north east. “As estate costs are relatively low, it means we can build with future occupancy in mind, so companies or research groups can gradually move in next to university researchers,” he continues.

Newcastle University has partnered with Newcastle City Council and financial services company Legal & General to create the £350 million Newcastle Helix innovation quarter to house R&D-led companies alongside institutes such as the National Innovation Centre for Data and the National Innovation Centre for Ageing. “A decade ago, environmental sustainability wasn’t seen as a viable market, but now people are making money from it – we’re working out how to do this with ageing at our innovation centre and how to build a regional economy around it,” Walker says.

Other projects that have successfully brought together industry and academic researchers include the Tyne Subsea research centre, focused on offshore engineering, and Newcastle University-led work on electric batteries and driverless cars at Sunderland’s Nissan factory.

Not everyone accepts the analysis that UK research funding is straightforwardly unbalanced. In a 2018 article for THE, researchers from UCL calculated that while half of the UK’s total R&D investment goes to London, the east of England (which includes Cambridge) and the south east (which includes Oxford), the figures per university and per head of population are a lot less clear-cut. And in a recent report for the Higher Education Policy Institute, the same group of researchers note that some comparator nations, such as the US and Germany, have greater geographical concentrations of research funding than the UK does. They also say that variations in R&D spending within regions are often greater than between them and they suggest increasing support for collaboration between universities in different regions, as well as allowing civic authorities to lead regional R&D initiatives within a national framework.

Moreover, “there is an obvious worry that the levelling-up agenda is really about levelling down for London”, says Diana Beech, chief executive officer of London Higher, which represents universities in the capital. With many London universities playing vital social roles within some of Europe’s most deprived boroughs, it would be a mistake to undercut their research initiatives on the pretext of social justice, she adds.

“If you look at an institution like Brunel University in west London, it is an anchor institution around the Heathrow area, which has been devastated over the past year or so,” she argues.

Another condition of an increased science budget may be changes to what the money is spent on – and who should have responsibility for deciding. Universities themselves favour the “quality-related” (QR) block grant, distributed on the basis of the REF. The Russell Group of research intensive universities, for instance, recently called for a substantial hike in QR spending. The above-mentioned Hepi report also calls for increased QR funding, as well as for research grants to cover the full cost of research (currently they cover only about 70 per cent).

“There must be some effort to strengthen QR funding,” Womersley agrees, noting that the real-terms value of the QR budget dropped by 13 per cent while it was frozen between 2010-11 and 2017-18. Since then QR has enjoyed a modest top-up, but universities would like much more. Still, ministers’ time-honoured preference for a new funding announcement over a top-up of existing budgets makes this a hard sell.

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“At the STFC, we were always able to secure funding for new things but never for improving research capacity in universities – even though this is where most students are taught. That needs to change,” Womersley reflects. However, he concedes that rewarding universities for their past record of excellence, as QR does, is not a good fit with the levelling-up agenda: “It’s more appealing to create excellence where it does not [currently] exist,” he says.

Another issue with the QR stream, according to Douglas Kell, professor of systems biology at the University of Liverpool, is that “it’s up to universities how they spend it – and it isn’t always spent on research”. Instead, any extra money should be handed to the research councils, he believes, in recognition of the fact that only about one in six grant bids is currently successful.

“Even if you were to double the current strike rate [of grant bids] to one in three, you would still be funding some really good projects,” argues Kell, who led the Biotechnology and Biological Sciences Research Council from 2008 to 2013.

He cautions, however, against expecting a big short-term uptick in commercial return for such investment increases, noting that, on average, it takes about 17 years for sector-changing science to become commercially applicable.

“When people started sequencing genomes in the late 1990s and early 2000s in the UK, many couldn’t see any reason for it as it wasn’t linked to industrial technology. Now, synthetic biology is completely game-changing for medicine and biology,” he explains. Globally, this sector now boasts an array of “unicorns” – start-ups worth at least a billion dollars – such as Boston-based Gingko Bioworks and California-based Zymergen. “The pandemic is a prime example of the importance of putting money into your science base even if it’s not clear-cut about where the benefits will ultimately arise,” Kell concludes.

It has frequently been claimed that the UK fails to capitalise commercially on the strength of its basic research. Indeed, that worry was one of the reasons for the creation of UK Research and Innovation in 2018, when nine research funders, including all the research councils, were subsumed under one overarching strategic body. However, criticism has endured that UKRI’s approach – which relies on peer review of applications – remains too risk-averse and bureaucratic.

The critic-in-chief is Cummings, who, during his brief but influential time as the prime minister’s chief aide, took a close interest in science policy. An enemy of bureaucracy, he not only oversaw the abolition of the much-resented “pathways to impact” section on UKRI application forms – in which grant applicants were invited to set out what the real-world impact of their research might be – but also took the view that the UK needs an entirely new agency focused on funding high-risk, high-reward projects – and located entirely outside the UKRI umbrella.

Despite Cummings' being sacked in November and subsequently falling out with the prime minister spectacularly, the Advanced Research and Invention Agency (Aria), as it is now known, has survived – and been allocated a four-year £800 million budget. Cummings told MPs in March that the agency’s mission should be defined as loosely as “to accelerate scientific discovery far beyond what is currently normal, and to seek strategic advantage in some fields of science and technology for the United Kingdom”.

A slimline modus operandi would see its leadership – consisting of an entirely independent director and no more than four trustees – setting out to “find people like [computer science pioneer J. C. R.] Licklider, Darwin and Turing in their early 20s with ideas that could change civilisation completely”. Alternatively, the agency might be charged by politicians with specific missions, such as preventing a repeat of the pandemic or perfecting carbon capture – in which case, its budget would have to rise to between £3 billion and £5 billion a year, in line with that of the US Defense Advanced Research Projects Agency (Darpa), on which Aria is modelled.

Darpa (originally known as Arpa, before its specific focus on defence was instituted) was created in 1958 in response to the Soviet Union’s launch of the world’s first satellite. That event, according to Steve Fuller, Auguste Comte professor of social epistemology at the University of Warwick, underlined to the US government that “scientists left to their own devices don’t inevitably produce science that leads to the greatest public benefit. When [President] Eisenhower asked his chief of staff why the Soviets had been able to launch the Sputnik satellite before the US, [the chief of staff] replied that [US] scientists felt that they could have done it but just didn’t think it was all that important. If you think about what the Space Race produced in terms of technology – but also how astronauts changed society and culture in a profound way – that seems extraordinary.”

In Fuller’s view, Aria should “start with a big, often speculative idea that doesn’t fit into any conventional academic framework and then crowdsource proposals from all over the place – not only from academia”. This approach, he says, would precipitate new partnerships that “span the public and private, universities and industry, domestic and international. Academics are forced to compete in a more alien funding environment, which is why many of them don’t like the idea of Aria: they might not be adventurous enough to get funded by it.”

Aria’s potential is demonstrated, Fuller says, by Darpa’s record of creating all sorts of technologies – including the internet, drones and virtual reality – despite receiving a fraction of the funding received by more conventional research agencies such as the National Science Foundation and National Institutes for Health. And he goes so far as to argue that funding for Aria should gradually replace that given to UKRI – an idea even Cummings has resisted – even though he concedes that “this means a much riskier form of science policy as success is by no means guaranteed”.

The establishment of Aria was broadly supported by all political parties during a parliamentary debate in March, despite some quibbles over transparency and its undefined research goals. However, this consensus misses the true historical lesson from Darpa, maintains Terence Kealey, the former vice-chancellor at the University of Buckingham, who has written widely on British science policy.

While Darpa did build an army of formidable pure scientists throughout the 1960s, it was only when the agency was defunded in the early 1970s and many of its workforce took their expertise to the Xerox Palo Alto Research Center (XeroxPARC), one of Silicon Valley’s foundational institutions, that the personal computing revolution began, says Kealey. Had that not happened, “the whole big tech revolution might have been European, with companies like Nokia ruling the world instead of Apple”. Kealey’s conclusion is that Aria will not only be a “wasteful failure” but will hoover up researchers who would otherwise thrive in private R&D. “There are only a limited number of good researchers, and if they’re all in ivory towers, then industry suffers,” he says.

More generally, he views the UK’s ballooning science budget as little more than a political fix to unite the Conservative Party after Brexit. “Boris Johnson knows he won’t be prime minister in five years – he’ll probably be gone much sooner – but he is looking for a vision that people can unite around in the short term. [Former Labour prime minister] Harold Wilson tried exactly the same thing in the 1960s with his ‘white heat of technology’ speech that saw him pour money into universities and research councils. It achieved nothing for the country’s economic state and we had to go to the IMF for a bailout by 1976.”

The private sector will certainly be crucial if the government is to meet its overall target of raising overall UK R&D spending from its current 1.7 per cent to 2.4 per cent of GDP. Indeed, countries at the top end of the R&D spending scale typically rely more heavily on private than government spending.

South Korea’s R&D spend of 4.6 per cent of GDP is topped only by Israel’s 4.9 per cent, and the nation’s economy is often held up as an example of the transformative power of sustained research expenditure. But So Young Kim, director of the Korea Policy Center for the Fourth Industrial Revolution at the Korea Advanced Institute of Science and Technology (KAIST), observes that private sector spending accounted for about three-quarters of the country’s $84 billion (£60 million) R&D spend in 2020.

“The share of government spending…is actually smaller than what the US and other advanced countries spend, which is contrary to the common expectation for a developmental state like South Korea,” says Kim. She says the South Korean government’s ability to incentivise private R&D spending has been its major success story in the post-war decades.

However, British companies have often been criticised for their reluctance to invest heavily, and for the longer term, in R&D – hence the UK’s failings in translational research noted by Sheffield’s Jones. And, according to Futao Huang, professor at the Research Institute for Higher Education at Hiroshima University in Japan, it is hard to see how the UK could reach comparable levels of private investment in the absence of its own versions of Samsung (single-handedly responsible for 15 per cent of South Korea’s entire GDP) and the other manufacturing giants that typically drive investment.

“Countries like Japan, Germany, Korea and China concentrate on transportation manufacturing, but…in the UK only about 40 per cent of total R&D [is spent on manufacturing]: that is the lowest compared to any other OECD countries,” says Huang.

Then again, the role of the public sector in the success of the Far East’s mega-corporations should not be overlooked, according to Womersley. “Big Japanese corporations do make much more visible contributions to R&D spending than the UK, but if you look inside, say, a project by the Sumitomo Rubber corporation to develop a new tyre, you’ll also find lots of postdocs funded by the government and lots of government money flowing through these private laboratories,” he says.

Hence, while the UK needs to learn from overseas examples, the trick will be to “understand what they are really doing, which is making it easy for firms to invest”, Womersley believes.

UK ministers thinking of rowing back on their science spending commitments as they contemplate the giant hole in the public finances left by the pandemic should also bear in mind other countries’ prioritising of science as part of their own post-Covid recovery plans, observers add.

US president Joe Biden, for instance, has proposed a massive $250 billion investment in science, while the European Union’s €672.5 billion (£580 billion) stimulus package of loans and grants is set to be used by the likes of France, Spain and the Netherlands to bankroll big hikes in their own science spending.

“If we can find tens of billions for a test-and-trace Covid system, we can definitely find £22 billion for research spending,” says Liverpool’s Kell. “If you want an economy, you have to make things – we can’t rely on banking and moving numbers round on screens. And, for that, you need to invest in science and technology.”

jack.grove@timeshighereducation.com