Examination of Witness (Questions 180
WEDNESDAY 30 JANUARY 2002
180. The fact is, then, that if the current
HEFCE decisions about funding go ahead there will be quite a significant
increase overall in funding for history research but there will
be a severe decrease in funding for research in science and technology,
where there has been nothing like the same degree of increase
in schools, and there has been a decrease overall in the number
of researchers who are actually included? To give just one example,
in civil engineering you will not get any research funding in
England at all outside the south of the country because there
is not a civil engineering research university in the north of
the country which has a 5. I do wonder whether it has been fully
taken on board how prejudicial to research and engineering and
science and technology the current suggestions about research
made by HEFCE are likely to be.
(Margaret Hodge) I think you are laying at the door
of the RAE blame for something which is not really related to
that exercise at all. I have got the figures here which showI
have not got the history figures with methat across all
sciences the increase in research income between 1995-96, 1999-2000
was 27.5 per cent. The increase in research income across all
arts in that same period was 28.1 per cent so it is about the
same. Within that you are right that the increase for engineering
was well below the science average, 17.6 per cent, and, if you
take the other level, the increase in pure arts funding was 128.9
per centa very low base, they only started with less than
181. They only need a pen and pencil really!
(Margaret Hodge) I do not think they would say thatnot
modern artbut that reflects this whole issue of careers
in engineering and people right the way through from school and
the lack of new people coming on in the engineering field, and
that is an issue of real concern. You are right as well
182. But you cannot look at a 28 per cent fall
in electronic and engineering as being something where you can
just say, "Well, that is how the formula works and there
is going to be a catastrophic fall in research funding"?
(Margaret Hodge) But the answer does not lie necessarily
either within the university sector and certainly it is not the
fault of the RAE exercise. The answer lies in the schools, in
encouraging more young people, women, to go into engineering.
That is where we have to start it. You will not solve it by giving
a different set of rules at the RAE level.
183. Your department in its written evidence
says that it sets the overall framework and policy objectives
for Higher Education Funding Council for England. You said earlier
you were content with the discipline HEFCE took in terms of allocation
of funding. Did it tell you or consult you about the decision?
(Margaret Hodge) They take the decision. The HEFCE
board take the decision; it is a matter for them. In a good working
relationship, there are a lot of conversations that take place
before those decisions are taken but, at the end of the day, the
decision rests with HEFCE and it is theirs to take.
184. In that context, and you are probably going
to give me a slightly elusive reply here, how much freedom does
HEFCE have in deciding how it spends its budget?
(Margaret Hodge) On that it exercised its own judgment.
We happen to agreewhich is not an unhealthy way to be doing
business with a non-departmental public body, which is what it
isthat the priority must go to sustaining as best we can
the world excellence of 5s and 5*s, but it could have decided
to give it all to 1s and 2s.
185. What would have happened then?
(Margaret Hodge) It would have decided. That is its
186. I want to take us on to the discussion
that you will have heard earlier with previous witnesses which
is the interface between research and teaching in the universities.
First of all, I would like your view: do you see a connection
between good quality research and good quality teaching or are
they different attributes which are not necessarily linked?
(Margaret Hodge) I think looking at the QAA outcome
of the subject reviews, you tend to get a link between good quality
teaching and good quality research. Having said that, we are thinking
very much about in reviewing where we think higher education should
be in ten years' time is that we have so far funded the higher
education sector very much as if it is one-size-fits-all, so you
get money through bodies and money through the RAE, two avenues,
and you do not really get money for excellence in teaching. As
we widen and extend participation it is going to become increasingly
important that excellence in teaching is a feature in the HE sector
and it needs to have a set of incentives around it so that some
institutions can focus on that. So whilst traditionally if you
look at the past there may be a connection, there is no reason
why in the future you cannot think of not having a one-size-fits-all
solution: having universities focusing on things they do best
and then having a set of incentives to ensure that you reward
them for doing that well.
187. That is a very interesting answer. It pre-empts
my next question because that is what I was going to ask: is there
an imbalance in the incentive which means that all of the funding,
apart from undergraduate levels, follows research rather than
teaching? Is the corollary of that that there is the potential
at least for universities to diverge into those which are research
universities and those which are teaching as their prime focus?
Does that worry you at all? Do you see it as a positive development?
(Margaret Hodge) It does not and I do see it as a
positive development. I think if we can encourage greater diversity
in the higher education sector, that is great. I think there are
some really strong, difficult issues we have to think about and
that is something you have touched onfor instance, a new
medical school. How do you provide the incentives there so that,
if an excellent research capacity emerges, you nurture it and
grow it. So I think there are some really tough issues you have
to think through but I am very keen, particularly looking at our
widening participation priorities, that one of them should be
that we should focus on teaching. I really feel strongly that
the cohort of young people who we want to encourage into higher
education in the next decade, both to meet our target and to meet
the skills needs that are required in the economy, will probably
need a very different sort of teaching from the teaching I experienced
when I was one of the 6/7 per cent to go to university, so we
have to reflect that in the quality of the staff. I see nothing
wrong, therefore, with having a diverse set of institutions but
we need to have some permeability in the system a bit like a old
football league, so they can go up and down and switch around
as and when. Also, the reason I talked so much about the distinction
between different sorts of research is that you do not want to
end up with all your basic research being done, for example, in
one area of the country; you want to have a knowledge transfer
capacity really well spread across the region and economies.
188. Do you think universities have changed
over the years since we were young
(Margaret Hodge) I hope so!
189.in terms of the persona they put
out to the public, for example? They are still called places for
brainy people, but do you think that has changed at all?
(Margaret Hodge) I think it is beginning to change;
I think it needs to change more. All universities are trying to
link themselves into their regional economies better than they
used to and that is to be welcomed, and the incentives we put
in the system to achieve that are beginning to work and we need
to do much more of that. It is interesting that only 4 per cent
of UK companies use the HE sector in their businesses and we have
to grow that.
You have probably heard me going on about this terrible business
of young people from the lower socio economic groups and their
aspirations in relation to university, and there is this awful
research that shows that over 40 per cent of people from C2/DE
socio economic groups never think about university as an option
for them during their school years. That is partly about the school
sector getting itself sorted out; it is partly about what we dothe
aim-higher campaign; promoting, raising aspirations; but it is
also about universities going out and down into their communities.
190. I think I accept what you are saying there
but there is a concern that, if we allow this dichotomy which
I suggested between those universities who have their focus on
research and those who focus on teaching, there is a danger that
the staff who we might want to be at those universities which
they are best suited to, for concentrating on teaching, will nevertheless
be attracted, particularly in the sciences, by the quality research
foundation along the road and that you end up with not just a
dichotomy of purpose to an extent but a dichotomy of standards
as well. That would worry me because it would introduce a new
divide which was not there previously and might work against the
quality of access which you are quite rightly advocating as a
fundamental bit of policy?
(Margaret Hodge) That could emerge so, again, we need
to see what incentives and structures we put in place to prevent
that happening. Whilst it might be sensible, particularly in the
sciences to concentrate on the funding because of the massive
cost of much of the investment, you might think about opening
up those facilities to be used by staff working in other institutions
in a much more open way than currently happens. Making that a
condition of grant might be one way of trying to ensure that we
maintain some sort of permeability between institutions and allow
new research capacity to flourish. There are issues and particularly
in the sciences it would be crazy to think you can spread what
will always be a limited pot too thinly, so you cannot get the
real investment you need to succeed internationally.
191. What you are suggesting there is that there
is a much more directive approach from government to the academic
community than perhaps we have seen before. That may be good or
bad but it is I think steering universities down very clear avenues.
(Margaret Hodge) If the Committee has any ideas of
mechanisms that we could employ which would allow the concentration
of resources which we require and yet the permeability that we
also desire, let us know, please.
192. One area which I know this Committee is
concerned about is the shrinkage of the number of science departments,
which we have already heard this evening is largely a function
of undergraduate recruitment. Does the Government, at the same
time as wanting to concentrate resources on the elite departments
quite rightly and to maintain the science base, etc, see a need
also to maintain, against the pattern of undergraduate recruitment
and, indeed, the difficulties which we know apply in selection
of sciences in schools, a variety of departments across the country
in larger numbers than might be the case than allowing natural
selection to take place? There is a national incentive to maintain
a variety of science departments around the country which is greater
than that which sheer market economics in terms of undergraduate
recruitment will require.
(Margaret Hodge) There will always be a regional dimension
to a sensible higher education policy so we will want always to
ensure a proper regional offer across the country. Beyond that,
I have to say that I am not convinced that sustaining uneconomic
departments where there simply is no demand for places is a sensible
way of using our resources. If you think of how much money we
do need and the under-investment over such a long period, I can
think of other really important priorities to which I would put
that money, so I am not sure it is a sensible way of doing it.
193. In your memorandum to the Committee, it
is suggested that 5* departments could be selectively funded on
the basis of their value to the British economy. Could you give
examples of departments that might be funded and how you would
(Margaret Hodge) Actual departments and their value
to the British economy? Can you re-read the passage, please?
194. It says that 5* departments could be selectively
funded on the basis of their value to the British economy. Following
on from that, could you give examples and how would you choose
(Margaret Hodge) Well, I think they are funded on
the basis of their value to the British economy so it was a sentence
that passed me by, I have to admit, in the drafting of that particular
bit. I probably need to see the context.
195. You would never let a civil servant slide
that past you
(Margaret Hodge) I read it and I had a big hand in
drafting it, Chairman, but I just cannot remember that particular
196. It is paragraph 17(a): "The future
development of selectivity, and whether it would make sense in
future to discriminate even between departments currently rated
5*, for example to identify those departments whose international..."
(Margaret Hodge) I know what we are talking about
now, yes. What we are anxious about is this issue of concentration.
There are only a limited number of departments, particularly in
some of the science areas, where we need really heavy concentration
of investment to compete internationally, and the 5* has almost
become too bunched up now to enable you to select within it those
three or four. We know that, for example, under the 1996 allocation,
a third of the RAE money went to four institutionsit was
that concentrated, similar to in the States but it was pretty
concentratedand that seems not an unsensible way of proceeding.
Given the growth in number in the 5*, is it still sensitive enough
for us to be able to extract from that those that really need
substantial investment to be able to pay the sort of salaries
and attract the sort of people that will keep our capacity going?
And we worry about that. There are various ways in which you can
address that. One of the options would be, again, perhaps to create
a new grade, those that are internationally competitive, where
we would give extra resources which would enable them to attract
the brightest of people.
197. So it would be a process of grading so
we can identify those that need more resources?
(Margaret Hodge) That would be one way. It is not
desperately sophisticated. I think probably round this table you
could all do it better than I can because you are all scientists.
198. Thankfully not all of us! Are there any
particular departments you are concerned about, or is it a general
(Margaret Hodge) I am very concerned about our ability
to maintain our international competitive edge. As you know, we
talk about all the Nobel prize winners but they came out of investment
ten, fifteen, twenty years ago and we want to have the Nobel prize
winners of the next generation. I am really worried particularly
about the salaries we are paying in competition to the States,
which is the key competitor, and that we have not enough money
in the system to pay competitive salaries.
199. Is there not a slight problem with the
bunching you talked about in that what we are seeing is departments
with international reputations graded to 5 having reduced funding
in relation to research, and the same is happening with those
graded 4? Those graded 5 are losing 15 per cent of their funding;
those at 4 are losing 30 per cent of their funding. Are you not
seeing a diminution or weakening of this activity in the system
as a consequence of the bunching?
(Margaret Hodge) Could you just repeat the last bit?
4 Note by witness: Source: Community Innovation
Survey. The figure (which relates to 1994-1996) refers to the
proportion of businesses with 20 or more employees that obtained
technological knowledge for innovation directly from higher education