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Research Funding (Universities)

2 pm

Jonathan Shaw (Chatham and Aylesford): I was delighted to win the ballot to secure this debate because it addresses the important issue of the future of our universities. Those institutions are crucial for the health of our economy, for social cohesion and for much more, and we will do our best to debate them, although events have overtaken us.

The importance of the White Paper, "The Future of Higher Education" cannot be overstated. Our nation's ability to educate and train its population at the level of higher education has never been more essential, and our ability to compete in the world and to increase our wealth will be greatly affected by the decisions made in the White Paper and the Bill that follows it.

The public debate about the White Paper has been dominated by the issues of student finance and the access regulator, which have an important effect on who goes to university and which institution they attend. The Minister for Lifelong Learning and Higher Education, my hon. Friend the Member for Barking (Margaret Hodge), and my right hon. Friend the Secretary of State have demonstrated a willingness to engage in the debate on those matters, particularly student finance.

There is a third strand in the White Paper that is equally important—the future of research funding in our universities. The Government must be scrutinised about that, and they must make their case. I wish to focus on what happens when students are studying, on how universities deliver by nurturing talent and inspiring people, and on how they contribute to our economy by doing those things and much more.

I am probably the least qualified participant in the debate, because I do not have a university degree, although, because of the Government's widening access agenda, I do have a qualification. I do not, therefore, enter the debate with any baggage that I might be accused of having if I had worked in certain institutions. I would not accuse my hon. Friend the Member for Norwich, North (Dr. Gibson) of having any baggage—or not much, anyway.

Research is the lifeblood of many of our universities. Good universities should be the generators of ideas. Research provides stimulation, attracts attention and makes a vital contribution to the quality of teaching which the Government have too readily dismissed. By 2005–06 public expenditure on science and research will have increased by £1.25 billion per year compared with 2002–03. That increase is widely applauded, but there are serious concerns about the further concentration and allocation of those resources. If we are truly trying to widen access, do we really want to create such a super-elite, which would lead to so few working-class young people being exposed to research?

Already, we have the most concentrated research funding anywhere in the world, with 75 per cent. of funding going to 25 institutions. The Government argue that only by concentrating research further will we be able to compete. They say that that is the way forward, and often refer to the United States. However, the top deciare of institutions in that country received 43 per cent. of federal research and development funding in

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1997; in 1980–81, the figure was 47 per cent. Rather than increasing concentration, the United States is spreading funding across a greater number of institutions, albeit that there is a smaller amount in percentage terms.

That is not happening in the UK. We are moving towards a position in which 80 per cent. of research funding will go to a few universities. The Select Committee on Education and Skills yesterday took evidence from Sir Richard Sykes, the rector of Imperial college. His assessment was that in future only five or six institutions would conduct leading research. If that is not the Minister's vision, I hope that she will explain why this afternoon. What will be the impact of continuing in the direction in which we are moving? I am not sure that the Government have had the opportunity to describe in detail the consequences, good or bad, of policies for which they are arguing and which they are already implementing.

I am worried that on research funding, unlike student finance and access, the Government are already ploughing ahead with changes. The previous research assessment exercise began in 2001 and is intended to run until 2006, yet those with a level 4 rating have recently had £30 million sliced from their budgets; that money has been passed to those with a 5* rating, which, we presume, will become the 6* rating of the future. That change was forced on HEFCE—the Higher Education Funding Council for England—by Ministers. Sir Howard Newbury told the Select Committee that his advice had been contrary to what Ministers wanted. We have not heard from the Minister why she took a decision that went against HEFCE's advice. What was that advice, and what would its impact have been? The purpose of the debate is to scrutinise the Government, so I hope that the Minister will tell us why she took that decision.

I should like the Minister to understand the message that she is sending out to people working in research. In 2001, one could have gone through the research assessment exercise in good faith and been awarded a level 4 rating in accordance with the rules, but £30 million has been taken off the budget in 2003, even though a review of the RAE is currently being conducted. Is that any way to carry on?

Mr. Tim Boswell (Daventry): Would the hon. Gentleman also consider the overtly political point that it seems bizarre that a Government who make so much of their commitment to involving the access student are, in the same breath and the same White Paper, bent on making the research funding system more elitist?

Jonathan Shaw : I shall come on to that; it is an important point. We want working-class youngsters to have access to research. Equally, I want the Eton graduate to feel able to attend a university such as Greenwich.

At the heart of my concern is the damage that the proposals may do in preventing new research from taking place and preventing departments from developing to international standards. Not all departments begin their lives with a 5* rating, but many achieve that; it is about developing infrastructure. There are examples of departments that have been assessed as level 3a, 3b or 4 achieving research breakthroughs. Those institutions have been outside what we call the golden triangle.

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What do the following have in common: the first-rate adaptive heart pacemaker; total hip replacement; the portable defibrillator; the contraceptive pill; the relationship between babies' sleeping position and sudden infant death; liquid crystal display; the motorway signage system; strained quantum lasers; and genetic fingerprinting? They were all invented or discovered at universities outside the golden triangle, many at departments that were rated at level 4 or below when the RAE was introduced. Many universities with lower ratings have gone on to gain a 5* rating. My great concern is that we will stifle that much-needed development in our universities.

The Minister has been a great supporter of the collaboration between Kent university, Greenwich university and Mid-Kent college in the Thames gateway area, and I thank her for all the practical assistance and financial support that she has given. I should like to mention a research programme in the university of Greenwich, which has a campus in the Medway towns. It has taken 17 years for that research team to develop its infrastructure and its capability to carry out international research and provide life-saving solutions that have considerable relevance to the matters being discussed in the main Chamber.

Since 1989, Greenwich university's school of computing and mathematical science, led by Professor Edwin Galea, has been developing a suite of human behaviour and evacuation models, aimed at helping designers of buildings, aircraft and ships to save lives. It has developed software to model people's behaviour in various conditions in which evacuation is necessary, and what happens when fire and smoke are introduced to that situation.

The list of clients is impressive and includes Airbus, Boeing, and the Sydney Olympic stadium. Most recently, Greenwich has been asked to assist the Beijing Government with evacuation designs for the Olympic games that will be staged in China. On that occasion there will be millions of spectators and tens of thousands of competitors. Getting evacuation right, especially in today's climate, is essential. That research has been developed over the past 17 years in Greenwich, one of the new universities. Greenwich has already won its gold medal; indeed, last year it was awarded the Queen's anniversary prize because of its research.

Returning to my point about developing research, the unit is now rated level 4, but when it went through the previous RAE, it was level 3a. That trend can be found throughout the sector. In 2001, the RAE found that 55 per cent. of research-active staff worked in highly rated departments compared with 31 per cent. in 1996. There is immense improvement throughout the institutions, but, if today's rules had been applied in 1996, it is unlikely that the team at Greenwich would have been able to develop the expertise that they have. The £30 million cut means that the unit has lost £150,000 in funding; that means fewer PhD students, and members of staff will have to be cut.

Mr. David Rendel (Newbury): Does the hon. Gentleman consider that such matters are especially unfair? So many university research departments were

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led to believe that, if they improved the quality of their research, they would receive more money. As a result, many universities put more money into research, only to find that, in a sense, some of it was wasted, not because the research was not good, but because their efforts to ensure that they would receive more money under the new RAE were fruitless due to the goalposts having been moved.

Jonathan Shaw : I agree with the hon. Gentleman; that is an important point. What were the rules in 2000 and 2001 when universities applied for research funding? Now, two years later, level 4 institutions, which are meant to be the bedrock of research, have had £30 million lopped off their budgets, and that is not to mention the effect on 3a and 3b-rated institutions. I have been advised that academics are withdrawing applications from institutions that are not level 5. That is not surprising, given that they are witnessing changes in the funding rules. The notion is that to stay alive the institutions must be level 5. Who will put their career behind an institution whose future and funding is in doubt?

Professor Galea will obtain another job easily, but a team of 25 people that has taken 17 years to develop cannot simply be picked up and put in another institution; its infrastructure has been damaged. It takes a long time to develop such expertise. The detrimental effects of the Government's decisions are being felt now. Students at institutions such as Greenwich need to have an opportunity to be exposed to research.

One of the many examples about which I was advised was a final-year undergraduate who took on a project about hospital evacuation for non-ambulant patients. The student's research led to a journal paper and several conference papers. If the research establishment were not at Greenwich, that young working-class student would not have been able to take part in the research. If we are to have a widening agenda, it is also important for us to be aware of what happens when youngsters go to university. There should be equality of opportunity at all our institutions, including exposure to research.

The Government want to encourage collaboration on research between different institutions, but for that to work, people need to feel that they are equal partners. That need is not unique to universities; it is common to us all. A great deal of collaboration has been taking place for many years, and the removal of funding from level 4 institutions puts that collaboration in jeopardy.

The Education and Skills Committee heard from Professor David Eastwood, Vice-Chancellor of the university of East Anglia, whom my hon. Friend the Member for Norwich, North will know well. Professor Eastwood told us that there was collaboration not only between institutions, but between units at the university. One might have one unit, as he does, rated 5* and another rated 4* which is losing its funding, and that jeopardises both projects. Yes, there should be collaboration, but one must be aware of the relationships involved. It is not always possible to collaborate, and the future of so many of our institutions should not depend on the need to work with others.

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Much in the White Paper is brave and right, and I applaud it, but since the Select Committee embarked on its inquiry, I have become alarmed at the proposals. That alarm has been heightened because changes have been implemented against HEFCE's advice, without consultation, and there is already a review of the RAE. That is having a profound effect on many research departments in universities throughout the country. I hope that the Government will pull back and ensure that they do their own research so that they fully appreciate that effect and the likely consequences of any further concentration.

2.22 pm

Dr. Ian Gibson (Norwich, North): I congratulate my hon. Friend the Member for Chatham and Aylesford (Jonathan Shaw) on securing this important debate. Discussion of this issue will no doubt continue until Christmas. The window is now open on higher education, which is excellent. At last, we have a Government who are examining the problems and advantages that higher education brings to this small island.

The first question that I asked myself was "Why does research take place in universities?" After all, we could set up research institutes, free from the clamour of undergraduates and without all the administration and support necessary for undergraduates and postgraduates. People could get on with research 24 hours a day, seven days a week. However, the young people who carry out most of the research in this country enjoy working in a university environment. They can work with younger undergraduates and produce a generation of future scientists. That system has served this nation well.

The debate is not only about Nobel prize winners, although they were also once young people with their bottoms hanging out of their jeans and long army coats who spent their time in pubs talking about the issues, getting excited and using their brains. They moved on to leading research teams because they were inspired and enthused by our university system. The reasons for conducting research in universities have been well proven over the years. As someone who has spent a lot of my active life acquiring grants from research councils, charities, the United States and many other sources, I can tell hon. Members that it is a hard business in which one is turned down many times, and has to come back again with new ideas. There is nothing like being in the ghetto to make people fight to get out of it, even in science. People in universities have done that to acquire research funding.

We should consider the record of work done in universities in this country, especially our citation index—the papers that are quoted across the world. Many scientists have had accolades, and many have headed school science labs. Last Friday I visited Totnes in Devon to help an ex-student of mine who runs a science lab and had acquired special science status. The enthusiasm engendered in that person, who, I might add, is somewhat older now, was generated in university teaching and research. She remembered the research project she undertook during her third year at university. That added value to her teaching, because she questioned and argued about things, which is what research is all about. That is also what universities are all

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about: students challenging what they are taught, knowing that there is more to discover. The literature is littered with people whose ideas and publications were not understood, or were rejected, but who won Nobel prizes after other facts were discovered. They have excited others to take up the cudgels and develop the research.

As far as I can tell from my experience, this is the first Government who have reacted to that situation. Since 1997 they have put billions of pounds into infrastructure, supporting research councils and generating more excitement and activity in research in universities and the UK research complex. However, there is still more to be done. How do I know that? The Department for Education and Skills has produced a paper called "The Future of Higher Education", which acknowledges the need for research in all areas, from writing books and creative writing, right through to science and the wealth of knowledge that is formed in the UK. That makes us a great nation in research fields compared with others.

The last 10 minutes of my lectures were always about current research. I would refer to the textbooks and prepare a good lecture, but I would suddenly talk about someone who disbelieved what I had just taught and had not yet been quoted, and about continuing research. Both the young and the mature students picked up on that. They would say, "Cor! If we had just read the textbook, that would have been it. We could have passed the exams, but now we are excited about this idea—tell us more about it." Research is all about students wanting to get their hands dirty and get involved. That is true for school science and university research.

There have been many other reports in addition to "The Future of Higher Education". The research assessment exercise has taken place and the Select Committee on Science and Technology, of which I am Chairman, has made a few friends through its publication. We have challenged the research assessment exercise, primarily on the basis that Jim Watson and Francis Crick would not have got a level 3 rating if they had followed the procedure. They grew up in an environment in which they exchanged ideas. We are celebrating the 50th anniversary of the publication of the DNA paper.

Harry Kroto, another Nobel prize winner, would also have found it difficult. Work done by such people as Sir Paul Nurse does not go on in universities. They spend part of their lives in a university and continue in research institutes. The network that we have built up in this country is superb, and is envied by people in the United States. The research assessment exercise was an attempt to engage excellence and to relate money to that base, to ensure that people got the support. I can be critical of it—our report is critical of it—but out of that has come a real review of the whole exercise, which I think will now have a lighter touch. Sir Gareth Roberts is already touring the Corridors of the House talking about the options. I welcome that and so does the scientific and research community.

This is not just about science: it is also about the arts getting the money. We concentrate on science because much more of the money goes into that field. I welcome what is being done, and I welcome the acknowledgement that academics are playing a few

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tricks. After all, they are probably the smartest people in the country, and if they cannot beat the system who else can? That is what we train them for. One of the purposes of the report is to ensure that they do not manoeuvre within the system, but it is also to ensure that multidisciplinary research takes place.

Our universities are still departments in silos. I was at a Downing street meeting the other week at which my right hon. Friend the Secretary of State for Education and Skills spoke. The vice-chancellor of Warwick university said that departments merely undertake administrative manoeuvres in a university, and that it is the whole university that teaches and carries out research. What he meant was that there ought to be more interaction between departments on research. He is absolutely right.

I can tell a story about that. At the university of East Anglia, people working on atmospheric chemistry in the school of environmental sciences and people in the chemical sciences department were doing similar work, but because of personality differences they never got together. It is in such situations that a tough vice-chancellor should say, "Look, let's find a way to do this together, so that we'll access more research money". Breaking down boundaries in universities is about good university management and exciting people to work together. That will help.

Levels 1 to 5 are merely a way of apportioning the cake, and there is now more money going around. That system is also about trying to recognise excellence, but it is fudgy at the edges, and not only because of the situation of such people as Watson and Crick. A headline in a local paper on Friday read: "Arts School has Designs on Extra Research Cash". An article below that reports on the Minister opening a fame academy for budding ballerinas and others, which seems rather appropriate. The arts school concerned is the Norwich school of art and design, which has a level 3 rating. A 3,000 per cent. increase in its research money was announced last week. Members may argue that, like people on low pay, the school did not start with very much anyway, which is true. It started with only £4,000, but suddenly, because it became a level 3b, it has some £144,870 and has to submit details of the art and design research that it intends to carry out.

If I were at the Norwich school of art and design I would be rather excited about that, despite the gloomy news that we often hear from universities. The Minister is trying to induce me to table an early-day motion on that subject, just to show how good departments can emerge from a rotten system, which is fine. There will be other good news stories. The principal is very pleased, as one might imagine. Things are certainly getting better for that school, which is producing some very bright young people in the artistic and design world.

Such people are interacting with people in universities. I dined with Antony Gormley, who designed the Angel of the North, and his wife the other night. They are very keen to do artwork in university science departments. The connection between arts and science—which correlates with what I said about university departments—is really beginning to happen. There are imaginative, innovative individuals out there

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who want to undertake that work, and we must find and encourage them, from whatever class or background they come, and ensure that it takes place.

There was a cross-cutting review of science and research in March 2002, which was very interesting. I think that the Treasury requested it, to see how money is used for research in universities. It makes some interesting points. It discusses the dual support system—the money given directly to universities by the Government for research and the money from research councils for applications and peer review research—and the third leg funding scheme, which involves money from charities and sources such as endowments and conferences that can be used for research. The review points out that there is deep tension among academia, Government, business and other research funders on the funding of science and technology and, in particular, on the failure of funding processes, which has led to a serious gap in university research funding.

The review mentions the need for state-of-the-art infrastructure and buildings. Most of the 1960s universities are crumbling. They may have been well designed by the architects who built festival halls that looked wonderful in the 1960s, but rain and time have turned them into shoddy buildings, and they are not that safe because the cement is crumbling. Much more money must be put into universities to allow the research to be done. I used to work in a lab in which the rain came through the roof. When I was a young student at medical school in Edinburgh I had first-hand knowledge of pigeons' nitrogenous excretion falling on lab benches—that would have made a good research project. It is not on for science students, scientists or academics to work in such conditions, and much more money needs to be put into that area.

The dual support system has worked well, but we must ensure that it is clear whether the money is for blue-skies research or whether it is for research that will be of use to society. A friend of mine in academia got a grant for squashing the testicles of grasshoppers. I used to say to him, "What is the use of squashing the testicles of grasshoppers?" Academics are especially good at being articulate, and he gave me a one-hour lecture. A friend of mine, who was not helped by me, sent a letter to the newspapers asking that question. The academic replied that, "It is not much use, but it is damned interesting. It might be useful to humans." No doubt the individuals who committed the atrocities that we have been hearing about learned what to do by squashing grasshoppers. There are serious problems trying to justify research in universities. They must talk more about their research in order to win public support.

There is also a funding gap in universities, and a creative accountancy model is currently used. For example, research councils do not fund the whole of a research project, so people have to find money from other sources. Universities will not turn down grants from charities. I had lunch with Sir Paul Nurse, who said that he was not going to use money from cancer charities to pay for toilets in universities. The management of money in universities must be more subtly tailored to grants. There are big gaps, and there is evidence that money is sometimes taken from teaching pots in order to pay for research that is not funded.

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The Select Committee on Science and Technology is examining how framework 6 and, eventually, framework 7 European money is accessed by people in this country. One reason why many people who could get that money do not apply for it is that they would have to find 20 per cent. of the funding from other sources.

Mr. Boswell : Does the hon. Gentleman agree that one historical problem has been the poor level of internal accounting in universities? When departments achieve 5* ratings and receive significant research funds, sometimes not all the money is allocated to them, but is put into the general pot rather than rewarding excellence.

Dr. Gibson : That is true, but the Government and the various councils have instituted a transparency review. We have identified where such cases have happened, which is the first time that proper accounting has been introduced to justify the use of money in universities. I remember having to learn what a spreadsheet was—these days, one does not become the manager of a department without learning how a spreadsheet works in order to be able to see the flow of money in a continually updated format. Universities have smartened up their acts, but they have some way to go in justifying themselves, at least to the public.

The funding gap has been identified. The research councils are examining the model used by the Wellcome Trust, which provides all funding in grants. It provides sufficient money to ensure that its grant is fully operated, so that universities do not have to take money from other sources.

The cross-cutting review identified the issue of academic pay, and we will never get good research in universities until we address that problem. I shall not go into how far academic pay has fallen behind that in industry. People work in universities because they love the work, the teaching and the articulate environment. Sadly, some of them like the senior common room a little too much, but in general there is excellence in our universities for which people are paid a pittance, which is why that issue is being addressed.

A great deal of research is conducted by research staff who are on contracts of one, two or three years. The Select Committee considered that. For example, some young women, who become old women after 20 contracts, live on six-month or one-year contracts. That is not on if we want the best people to stay in universities and carry out research. I make no apologies for that.

The White Paper "The Future of Higher Education" makes the point that we will have to concentrate our research much more in certain universities. I believe that Richard Sykes, who is at Imperial college, said in a Select Committee yesterday that we need only five top-class universities in the country. I do not agree. We have to resist that temptation, because there is excellence in all our universities. The university of Dundee, which is an institution of some excellence now, was founded on one man's discovery of protein for sporulation, from whence have come spin-off companies, cancer units and so on. Dundee is becoming one of the top universities for research.

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We should encourage such thinking in every university, and we should find mechanisms to recruit people from the United States or from this country, where many of them have been trained, who want to work in Britain. We have done that for stem cell research; Britain leads the world in that area, and we have people queueing up to come back and carry out research in this country. Members of this House and the other place were very much instrumental in bringing about the regulations that allowed that to happen. We should pat ourselves on the back for what we did in this Parliament and the previous Parliament to make research and its funding top notch in the stem cell field.

Other good work is being undertaken, including Beagle 2 landing on Mars, the Open university and the construction of new joints for people with damaged bones. We had a meeting last Thursday that was full of good news stories relating to science, because science is being backed in this country and industrial relations with universities have been made to work so that they benefit our people.

I want to talk about excellence. I was brought up in a very Scottish way and hated Oxford and Cambridge. I did not need to go there to get a blue in football. I preferred to play for the team that I played for in Scotland rather than to get a blue from Oxford or Cambridge. Some people were tempted to go to Oxford and Cambridge, because there was a feeling that they were the jewels in the crown and the glittering places to go. Given the Scottish culture, going to England would have been a huge step at that time and was something to be resisted. At university, I heard about the magic of Oxford and Cambridge and a few places around London—the so-called golden triangle. I never believed what I heard, because my teachers were superb. My teacher is 90 this year and there will be a big do for him up in Edinburgh. It will be full of glittering past students, such as Professor Stephen Jones, all of whom passed through a small department, talked and argued together, and were cultured as a result of the teaching and research. Edinburgh university was not bad either, even though it was not part of the golden triangle.

Money is predominantly going to the universities that make up the golden triangle, and we should ask whether that is the best way it could be spent. Given my culture, hon. Members will understand what I am about to say. I am not an envious person, but when I see the election of the chancellor of Oxford university getting the coverage that it has had in the papers over the past few weeks, I ask myself, "Who gives a fig? Why is it so important?" There were three aged blokes and a token woman—there has not been a woman chancellor in the 800 years that the position has existed and I bet that there will not be one in our lifetimes.

The network that controls grants spins out into the scientific and academic establishment in this country—I am not envious, because I have benefited. It decides the subject areas that will be funded. I am writing a piece on that, and there is plenty of good evidence about the people in question. They are no better than people elsewhere in the country. We must break that elitism, otherwise we will not break the elitism surrounding access to universities. We also need an access regulator to examine where the scientific research money goes, who is on the committees that decide who gets it and so on. There is a correlation. I was part of the inner

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network and knew how to access that money. I might have gone out of the room when my subject was being discussed, but my mates were still there, and I was in there when theirs was being discussed.

We must provide transparency and openness in the funding of research in this country. The story of the election of chancellor of Oxford university shows how important a chancellor of a university in one part of the country can become. Who is chancellor anywhere else? Jeremy Paxman would never ask that question on "University Challenge". He might ask about the chancellor of Oxford university, but he would not ask who the chancellor of Dundee university or the rector of Edinburgh university are, or where the Chancellor of the Exchequer went to university or which university he was rector of. Hon. Members know what I am getting at.

There is concentration on Oxford and Cambridge. When the Government say they are going to concentrate on certain universities, I fear that we will miss out on the excellence found in universities in Greenwich, Dundee, Norwich or Manchester. Some of us were involved in the debate about the siting of the synchrotron in Oxford. That may have been the right place, but it left people in the north-west of the country feeling angry and undervalued. I welcome the fact that the Government responded to the protest by investing money there.

Research funding is important for the creation of wealth in this country and for the future. It is also important that we ensure that it is spread around, and that mechanisms are used to allow access for all people in this country who want to carry out research. Research is exciting; it blows the mind. It can be boring, too. One can carry out research for a long period, and not understand what has happened. Sometimes the best discoveries are made on a Friday afternoon after going to the pub. People try to repeat the discovery on a Monday, and wonder what they did right or wrong. Sometimes it is an accident that brings about discoveries. We have to create that environment and not expect those people suddenly to turn something up in five minutes, or even five years.

I welcome the debate. Much more will be said about all aspects of higher education. We have a great opportunity to build on the paper presented by the Government. There will be ups and downs in the arguments, and I welcome that. The research funding issue is a good place to start. We must ensure that we provide more funding, and encourage all those who want to carry out research to give us more of what we have had in the last 200 years.

2.47 pm

Mr. David Rendel (Newbury): I am slightly hesitant about following the hon. Member for Norwich, North (Dr. Gibson), as I have to admit that I did my first degree and my second—not that I ever achieved it—at Oxford. That makes me one of those who has absolutely no right to speak in the debate—according to the hon. Gentleman, that is. I tend to agree with a great deal of what he said about the recent election of the chancellor of Oxford, about which he was pretty well spot on, and I had to agree with much of what he said about Oxford being an elitist institution. There is no question but that it needs to come into the modern world in some ways. Having said that, I should also declare an interest.

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One of my sons is about to start a research degree at university, so university research funding is at the centre of my thinking. Two of my other sons are at university as well, and they are being taught by people who are involved in university research and teaching. I have a personal interest in the matter, quite apart from my spokesmanship, and I am delighted that the debate has been secured and to have a chance to participate.

The first thing I would like to say—it should appeal to the Government if nothing else does—is that research has clear economic benefits for our country, and the rate of return on even basic research is thought to be as high as 40 per cent. Even if there were no other reasons, that is why we should fund university research properly.

Secondly, research involves pushing back society's intellectual boundaries—knowledge for its own sake, although the Government are less keen on talking about that in relation to our universities. It seems that the push is to ensure that universities meet the economic needs of the country, but they are also very much about meeting our country's social and cultural needs as well as enabling our young people to get the best out of themselves and to give the most of themselves to society, thus benefiting us all. If Britain is to have researchers not just in universities but throughout its economy, they must be trained to do research. That is an important function of university research departments, and everyone who goes into research almost certainly starts by doing a research degree at university.

Research enables Britain to benefit from research done in other parts of the world. Only some 5 per cent. of research is done in this country, but researchers who work at the leading edge of their particular subject are best placed to use research done elsewhere. People who are not working at the leading edge of their subject may not even understand it. One has only to think of the number of people who do not use high-tech equipment simply because they do not understand how it works. The more that people in this country are at the leading edge of research, the more likely that Britain can make good use of research done overseas. Therefore, research is worth while. It is beneficial in purely financial terms to this country.

We must encourage more of our most talented people into academia, and, obviously, allowing them to do research at universities is one way to do that. Academically talented students are deterred from staying on in academia to study for PhDs, however, and there is a recruitment and retention crisis in our universities. In the past two decades, staff-to-student ratios in UK universities changed from 1:9 in the early 1980s to 1:18 at the turn of the century. Forty per cent. of those in the profession are over 50. The Association of University Teachers says that an extra 17,000 university teachers are needed to replace those who are due to retire by 2010. An important aspect is that there are particular problems in core subjects such as science, maths and engineering, which are precisely the areas in which we have problems getting enough teachers in our schools.

According to an AUT survey released this month, 27 per cent. of academics—the equivalent of more than 40,000 staff—are seriously considering leaving the profession, mainly because of the growing work load and, of course, poor pay. According to the same survey, only 36 per cent. of academics said that they would

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recommend work in higher education to an undergraduate. If an undergraduate does not get a recommendation from someone who already works in the profession, they are unlikely to become involved themselves.

Let me say more about pay, which is, clearly, a key factor. During the past 20 years, academic pay has increased in real terms by only 5 per cent. while average pay in the community has increased by some 45 per cent. Despite the 2002 pay agreement, salaries are still well below those of counterparts in other sectors. The Liberal Democrats believe that it is essential to pay academic salaries that will attract new, high-quality recruits and we are committed to freeing up the resources needed to meet the Bett salary recommendations, updated from 1999 levels to equivalent 2003 levels. We would do that now, and we have pointed out in our alternative Budget precisely how it could be done.

Top-up fees, which are yet another tax on students, will not bring in the funds needed to pay university research staff properly until 2006 at the earliest. Universities need money now to fund the pay increases that researchers and academics must have if they are to be encouraged to enter and stay in universities.

It is also important to mention student debt, which has been much discussed recently inside and outside the House. It is noteworthy that 81 per cent. of academics oppose the introduction of top-up fees, according to the AUT survey. If someone wants to become an academic, they must have a PhD. That means relying on the relatively low graduate stipend for several years, probably until the age of 26 or 27, and putting off even further the repayment of graduate debts. Academic salaries are pitifully low and the effective 9 per cent. marginal tax rate is very difficult for people to cope with.

The 2001 British Academy report on graduate studies in the humanities and social sciences found that the UK is failing to attract sufficient of the best British students to take up PhDs in the arts, humanities and social sciences. An increasing proportion of postgraduates are recruited from other EU countries and overseas. I was told recently that not a single British student is studying for an economics PhD in this country—they all come from overseas. The same report concluded that debt—that accumulated from undergraduate study and prospective debt from postgraduate study—is a major deterrent to potential PhD students.

A good point that has already been made is that universities have also been criticised for excessive use of short-term contracts and denial of employment rights to research staff. Almost 50 per cent. of university employees are on short-term contracts and numbers have increased rapidly since the early 1980s. Most are employed on post-doctoral research in science departments where, as with junior doctors, they are expected to do all the hack work, while their seniors claim the credit and write up the results.

Researchers are generally paid less than tenured lecturers, although they are linked to university scales, and employed for only limited periods of perhaps six months to two years. That makes it difficult to obtain a mortgage, for example, as their employment prospects are variable and uncertain. Many universities refuse to employ people on a second contract to avoid liability for redundancy payments.

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Talented researchers have often gone on to become tenured lecturers, but there are often 10 applications for every post and it is difficult for them to move on in that way. Sadly, salaries are not high enough to attract some of the best and most highly qualified candidates, who might otherwise opt for academia.

Pay, work load, lack of adequate career structure and debt are fuelling a damaging brain drain of academic talent to overseas, and creating incentives for people to opt for a career in the private sector and to opt out of a career in our universities.

The third reason why research is important is the link with research teaching. Traditionally, university teaching has been distinguished from further education and other post-19 teaching by the fact that academics in those institutions have simultaneously undertaken research. That may not be so true now that more and more research takes place in further education institutions, but there is still a lot of truth in it.

Teaching benefits from people working on research for a number of reasons—it keeps them up to date, they must actively follow the literature to contribute in that area and they tend to be more able to talk about their research and how it links up with their studies—but the White Paper makes the extraordinary statement that

Very few people working in universities would agree with that. The vice-chancellors, as represented by Universities UK, and university staff are at one in disagreeing with the Government. According to the AUT survey, 86 per cent. of academics believe that the research-teaching link should be retained. Universities UK says that it cannot understand the White Paper's assertion. It says:

Liberal Democrats believe that, far from being indirect, the research-teaching link is integral to what universities do. Students benefit immensely from teaching grounded in a research environment because that facilitates a more active engagement with the subject at the very frontiers of the discipline and because of the thinking and research skills that are imparted. Academics also benefit because teaching allows them to test their ideas and arguments.

In contrast, the Government's proposals imply a two-tier higher education system with elite research institutions—Oxford among them, no doubt—at one end of the scale and others relegated to being teaching-only institutions. In the latter case, high-quality staff will be lost as they seek, understandably, to work in a research university.

I turn to the Government's proposal to concentrate research funding. The White Paper states:

arguing that "larger, more concentrated units" are justified on the ground of "economies of scale". It continues:

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In fact, research funding is already being concentrated in that way and the trend is to move even further in that direction, which will benefit the top 10 research universities. There is a real risk not only of a two-tier university system but of damaging the institutional diversity that is a strength of our higher education system.

In the briefing circulated to hon. Members for this debate, Universities UK notes:

That is a particular kick in the teeth for those departments that have worked so hard to raise their rating in the research assessment exercise. Science, engineering and maths research could be at particular risk—precisely those subjects in which we face important shortages.

Plans to concentrate research in only a few research universities are deeply flawed. When economies of scale in scientific research have been claimed, it has been proved that they do not exist. There is no evidence to support such a contention, except in rare cases involving very large pieces of equipment such as telescopes or synchrotrons. What is required to stimulate innovative and productive research is work in the specific sub-field in which the researcher specialises within a group of five or six people with whom to test ideas.

Evidence of economies of scale is not only unconvincing but there are obvious dangers in shutting out the unorthodox and restricting research in ways that damage British universities' international reputation for research excellence and innovation. That will also damage our economy.

The key issue is concentrating research funding in the hands of only a few research-intensive universities and the danger is that such an approach might stifle diversity and creativity. Britain's dual system of funding research has rightly been called the jewel in its research crown, precisely because it has always allowed for the serendipity from which so many of our most creative scientific breakthroughs have emerged. The Government would be foolish to throw that away, but their policy pronouncements have raised a real worry that that is what they intend.

3.3 pm

Mr. Tim Boswell (Daventry): I congratulate the hon. Member for Chatham and Aylesford (Jonathan Shaw) on having the good fortune to secure this debate and on the characteristically modest but thoughtful way in which he introduced it. He made some valuable points.

At the same time, I commiserate with the hon. Gentleman for his ill fortune in having been given this moment for his debate. I sense that the mood of the majority of the country, as well as hon. Members, will be focused on the main Chamber rather than here. However, I can offer some comfort: Winston Churchill's memoirs of the second world war record that the great

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man found time in the middle of conducting global warfare to attend, by minutes to his colleagues, to such matters as the state of the Admiralty flag and the future of British bloodstock.

The latter of Churchill's concerns is analogous to the serious matter that we are considering—a jewel in the British crown which we are all anxious to preserve. That has been the theme of all of the speeches so far and, to anticipate the Minister, of her speech as well. We are all on the side of British research, and broadly on the side of British universities, but although we are distributing compliments, it is fair to say that we recognise the tensions. The first one is that, almost inevitably, there will be elements of a zero-sum game between the various interests involved. The access universities will be at one end of the range, and the Russell group at the other, and they will all be finding ways to devise or modify existing formulae or practices to secure greater advantage. I heard elements relating to that in the speech of the hon. Member for Norwich, North (Dr. Gibson).

I assure the hon. Gentleman, by way of declaring an interest, that although I began life as an Oxford classicist, I spent time on a science research council. I am not sure what qualifications I had for the post, but it was educative—perhaps I was chosen because I had run a small science research charity. One of the most interesting developments that we produced, which eventually became intellectual property, was due to somebody, whom we were sponsoring, in the department of electronics and electrical engineering at Sheffield university working in conjunction with a colleague who was a zoologist. That led to some interesting ideas on marine biofouling. If two departments are not in the same place, or they are not talking to each other, such opportunities will be lost. [Interruption.] I am pleased to hear the Minister acknowledging that that is a great strength of the university system.

I should like to talk about the huge diversity of research funding. The hon. Member for Norwich, North was right to remind us of the European element, but, in domestic funding, different streams are coming from the HEFCE research selectivity exercise and from research councils, charities, non-governmental organisations and others; finally, there is contract, commercial research. All of those are to be welcomed and drawn on, and we must recognise that complexity. That range of streams must continue; no one stream should be dominant or calling all the shots.

An important point about the university portfolio which has been acknowledged—I hope that the Minister will acknowledge it too—is that universities are not there to conduct one-shot exercises of a highly specialist nature, and it would be contrary to the definition of a university for them to do so. I feel strongly that in almost all cases there should be some coincidence between teaching and research. Being invited as a first term undergraduate to a seminar given by the doyen of Oxford classicists—a Nazi refugee who had arrived in London unable to speak English and was therefore required to lecture in Latin in his first year—was a remarkable cultural experience. The man was also very good at his job. Whatever institution one is in, there must be opportunities for such exposure to people of excellence.

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I shall also mention my local university college in Northampton. I do not grade it below Oxford—they are equal in my affections. It is doing an excellent job as a regional university college, and because of the local boot and shoe trade, it has the National Leathersellers Centre—a world centre of reference for expertise in that industry. We should not have the kind of tidy-mindedness that compartmentalises universities into those that solely teach and those that solely conduct research. We must recognise strengths. I hope that Ministers will reflect on some of those points when they consider their detailed plans on collaboration. The matter is much more complicated than a superficial reading of the White Paper suggests.

I want to highlight three points of particular concern relating to the White Paper which the Minister may like to consider. The first relates to the degree of selectivity. The Universities UK briefing asserts that under the new system that the Government are devising, which will have a level 6*, we will have a more selective system than that applicable in any other country in the world. That was also explicit in the remarks made this afternoon. The Minister must deny that, and explain why it is not the case, or justify it because I do not believe that the Government have done either of those things. The matter needs to be thought about.

The hon. Member for Chatham and Aylesford referred to consultation and to people being caught without a chair when the music stops—if I can use such a phrase in relation to a research selectivity exercise. As the exercise has been set up on a quinquennial basis, it is unfortunate that it should be altered in the middle of that period. The fact that it is being altered, apparently without consultation, is greatly exercising the universities. The Minister must explain the degree of consultation and understanding involved. No one should necessarily mind having to adjust to a new regime for the next period, but to find that a legitimate expectation, as lawyers would call it, is being frustrated in the middle of the process is unfortunate. I leave that point with the Minister.

I come now to the practical consequences of such action. One matter to which the hon. Members for Chatham and Aylesford and for Newbury (Mr. Rendel) referred, and about which I am concerned, is the present situation of teaching staff and the impact of changes. The withdrawal of money from an institution, especially when that money is not lavish, will have an impact, with likely consequences for teaching staff and research groups. In the White Paper, the Minister forgot about the support staff and the technicians—important people who make research possible in our universities. The matter needs to be treated with great sensitivity because an intellectual resource is likely to be thrown away. I have strong sympathy with those who want to make changes, but I am not in favour of changes made hastily, especially in the overly tidy-minded, compartmentalised way of Ministers.

The White Paper is almost silent on the Bologna process. The Minister was kind enough to give me a response this week by way of written answer, but the inference among European rectors and in the European university process is that universities are about teaching and research. An institution that was, for example, simply teaching would not prima facie qualify as a Bologna-acceptable university. I think that the Government must pause on that point, too.

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Issues about how research should be configured have been implicit in the debate. However, a point that has not been made clearly concerns knowledge transfer. I have kicked it around a bit, but I am still not clear where knowledge transfer fits in between teaching and research. There is an important economic point to be made about knowledge transfer, and I do not argue against that, but it is not entirely clear how it is to be delivered and what is its relationship with teaching and research. To put it another way, if all the money from research will go to institutions with a 6* rating, will not there be a gap in funding for institutions achieving the lower ends of knowledge transfer? I happen to think that both research and knowledge transfer are extremely important.

Universities are, and should be, protean organisations, reaching out in all directions, and receiving, bringing together, disseminating and transmitting excellence of all sorts. Naturally, there will have to be concentration on funding. There have to be formulae—we have always understood that—but the balancing of funding must be done sensibly.

When I was the Minister responsible for higher education nearly a decade ago, we did our best to offer development funds for research in the new universities. We tried not to destabilise the existing system, and, in general, we tried to make haste slowly. There are big research teams, which need a lot of kit and high capital investment. I do not resile from that, and it may be sensible to concentrate on those cases. However, there are institutions and smaller-scale research teams that are doing excellent work, and in the humanities there will still be lonely scholars in garrets who are thinking important thoughts about philosophy, history or whatever, perhaps without a lot of support.

I conclude by paying the Minister a compliment. I am delighted that the long process of establishing an Arts and Humanities Research Council has reached fruition. Such processes always take a long time. This one started about 10 years ago, but we have got there. That is welcome, and it may act as a counterbalance. However, we should also celebrate the university sector in all its diversity, and I think that we have done that. We should recognise that things cannot be put into narrow boxes or compartments and, above all, that the sector needs a system that is broad-minded and sensitive enough to cater for excellence wherever we find it.

3.16 pm

The Minister for Lifelong Learning and Higher Education (Margaret Hodge) : I join other hon. Members in congratulating my hon. Friend the Member for Chatham and Aylesford (Jonathan Shaw) on securing the debate. It is regrettable that it should be taking place on a day when there is a momentous debate in the Chamber. I know from conversations that I had last night that several hon. Members would have contributed here today if they had not wanted to participate in the main debate. I hope that we will discuss this subject again because I agree with hon. Members that it is a vital part of our White Paper and our higher education policy, and that it has not so far received adequate attention.

All hon. Members present agree on the importance of research. I share the view of the hon. Member for Daventry (Mr. Boswell) that we are all on the side of

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British research. I also agree with my hon. Friend the Member for Chatham and Aylesford that it is the key driver of economic growth and productivity, as do the Secretary of State and everybody in the economics Departments—the Chancellor and people in the Department of Trade and Industry. We have given it such prominence in our White Paper because it is so important, and that is why it was also given prominence in the funding plans of the Chancellor and the Government.

When we talk about research, we often talk about science, but we should never forget the important research that takes place in the arts and humanities, which is why I am delighted that we will be able to establish a council in that field. Some of that work creates economic growth and productivity; the cultural industries are a good example of that. Other kinds of work—such as community development research—help to strengthen community cohesion, which is an important function of research. However, some research work simply enriches our lives, and we should never forget that one purpose of much of the activity that takes place in our universities is to foster great enrichment in the life of every individual in our society.

Global competitiveness means that there is a growing concentration of research resources throughout the world. In the United States of America, only 200 of the 1,600 higher education institutions have the power to award postgraduate degrees, so there is a history of concentration and differentiation in the USA that is not a part of our education system.

I recently returned from a visit to China. The Chinese Government are focusing massive research investment—much more than we are capable of investing, simply because of the size of China's population and economy—on the country's most research-intensive universities. We should look forward to the capacity that we will have in five or 10 years to compete with China, particularly in science research. If we do not focus our research, much less of it will take place in this country, and we will not be able to have the growth and productivity that comes from research.

Jonathan Shaw : Does China have the widespread research base that this country has? Where is it starting from?

Margaret Hodge : It is true that China is starting from a lower base, but it is an enormous country with a huge population, and it is increasing its higher education budget by 20 per cent. per annum over the five-year spending period. If one focuses such resources on a very few institutions—as China is doing—one can quickly build up enormous capacity. I saw new laboratories in China's leading institutions, and my hon. Friend the Member for Norwich, North (Dr. Gibson) would be deeply envious of the equipment available there. Because of China's size, it can skip a generation and can quickly overtake us on research.

Some hon. Members mentioned a tension between our agenda for widening participation and our research agenda. I do not agree that there is a tension. First, we want to achieve excellent teaching for all in all our universities. I hope that that ambition wins through in

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the White Paper. Excellent teaching will provide a lot of opportunity. Secondly, we want fair access to our most prestigious universities. Those two policies combined mean that there is no conflict or contradiction between our widening participation agenda and our research agenda.

I think that we all agree that the UK's research record is unrivalled. We have had many Nobel prize-winners because of our traditional and historic investment in research. We have only 1 per cent. of the world's population, but we produce 8 per cent. of scientific publications. Most interestingly, in 15 of the 20 main fields of scientific research, America comes top and we come second. We are proud of that record, and we are determined to maintain and build on it. That is why, in this comprehensive spending review, our investment in research capability is the most generous ever. By 2005–06 we will have increased investment and research by 30 per cent. That will help to ensure proper funding for research, an issue raised by my hon. Friend the Member for Norwich, North, which the transparency review identified as one that we need to address.

The hon. Member for Newbury (Mr. Rendel), representing the Liberal Democrats, failed to say how his party, were it ever to be in Government, would tackle his massive agenda. He has not said what would be his party's priorities or how it would fund them. All that I have ever heard from the Liberal Democrats is that they would fund everything by cutting student funding to two years and forcing people to go to local universities. That is not a route that I want to take.

We have always concentrated research funding. In the following examples, I have deliberately taken the 2002–03 figures rather than the 2003–04 figures that came out last week. In 2002–03, Cambridge got nearly £68 million in research funding, but Anglia polytechnic university got £369,996. Oxford got nearly £65 million, while Oxford Brookes got just over £2 million. Imperial college got over £60 million, but London Guildhall university got £200,000. Although I do not agree with Richard Sykes that we will end up with a concentration on just five or six institutions, I think that a limited number of institutions will compete in the global economy. Many more departments will play a role on the world stage.

There are accusations about a golden triangle. I draw to the attention of all hon. Members the important collaboration that took place last week: the merger of Manchester and UMIST. That will, I hope, enable us to start breaking down the concentration of research funding, which I accept exists in the golden triangle.

My hon. Friend the Member for Norwich, North raised the matter of academic pay, which is critical. If we are to keep our best researchers in the UK, we must pay them well. All the evidence that we had on the average salaries for the top professorial posts in the UK led to the finding that there was a brain drain, and too many of our best researchers were leaving and going elsewhere. If we do not tackle that problem, a threat may emerge from places like India and China, so academic pay requires a concentration of funding in future, or we will be in danger.

On the link between research and teaching, I regret the comments made by the hon. Member for Newbury, who said that universities were being relegated to teaching-only institutions. At the heart of the White Paper is our effort to raise the status and importance of

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teaching in our universities. It is as important to us to build the capability among individuals as it is to provide the research base to fuel the economy and enrich our society.

Let us consider the distribution of money last week by HEFCE. I use Greenwich as an example, because it was raised by the hon. Member for Chatham and Aylesford. He was correct in saying that Greenwich lost some £615,000 of its research funding. However, it gained money in its teaching grant. That was done deliberately, so that we can start getting our universities to focus more on what they do best and thereby concentrate our research resources. People often ask me about the evidence for that. In 2000, HEFCE commissioned a report on the interaction between research, teaching and other academic activities; it took evidence from 40 universities and colleges and concluded

I have often said, in the Chamber and here, that the last RAE determined the distribution of quality through a peer review exercise. It was never supposed, nor intended, that it should determine a distribution of resources. It was always a relative quality exercise, never a resource-distribution exercise. I am delighted that Sir Gareth Roberts is engaged in reviewing the RAE—various hon. Members have talked about the way in which he is doing that. Perhaps the academic community will feel more comfortable with the outcome of that peer review.

I accept that change is difficult. It is difficult for us to achieve the greater focus on mission that lies behind the White Paper. I accept that, a year after the last RAE, some institutions have found change especially difficult. However, to put it bluntly, we could not have afforded to wait until 2008—the time of the next RAE—to start instituting some of the changes that we wanted.

People talk about a greater concentration of research funding. Let me tell hon. Members what happened. Between 2002–03 and 2003–04 there was a 1 per cent. increase in the proportion of money that went to the top 25 universities. That is not a massive shift, but it is important and it moves in a direction that we believe will best conserve the best research in the UK. Much of the stress in the White Paper is on concentrating and building collaboration between universities and between departments in universities. That is why we talk about collaboration and consortia; such things reward talented researchers and offer better funding for postgraduate research places. All that is intended to build capacity and ensure fluidity in the system so that we can grow good research.

I say quickly to the hon. Member for Daventry that I accept that the money that comes under knowledge transfer will have to be focused primarily on the non-research intensive universities, to enable some redistribution in that direction.

The White Paper provides the basis for ensuring that we can fund the best research properly—that is critical to the nation's economic growth and prosperity—and fund emerging research and capability in certain institutions, to ensure that we grow new research in our universities.

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