Memorandum 38
Supplementary evidence from the Department
for Innovation, Universities and Skills following oral evidence
session on 20 February 2008
SCIENCE BUDGET
ALLOCATIONS INQUIRY
Answers to follow-up questions provided by the
Department of Innovation, Universities and Skills
1. Please provide the Committee with details
of the success rates (including n-values and percentages) for
research grants at their prospective quality grades for each Research
Council.
RESEARCH COUNCILS
SUCCESS RATES
The application success rates for all Research
Councils for 2005-06 and 2006-07 are in the public domain and
will continue to be monitored and reviewed by RCUK.
The Research Councils publish annual figures
on the funding rates of individual universities and research organisations.
All Research Councils receive substantially
more high quality proposals for research funding than they are
able to support. The funding rates published reflect the level
of demand balanced against the available resources during the
year. The Research Councils seek to maintain an active dialogue
with their research communities concerning levels of demand and
funding rates and in disseminating best practice. Some Councils
have received significantly more proposals in recent years, and/or
applications for increased resources per grant, and both of these
are relevant to success rates.
The latest data can be found at:
http://www.rcuk.ac.uk/aboutrcuk/efficiency/demand/successrates/default.htm
2. Please provide the figures referred to
in Q 211-212 and Q 216-217 on exchange rate fluctuations.
For a number of years the Department had an
arrangement with STFC (and prior to STFC's creation, CCLRC and
PPARC) and NERC under which some of the increase in their subscriptions
to five international organisations (CERN, ESO, ESA, ILL and ESRF)
was met centrally from the Science Budget. The arrangement covered
increases due to exchange rate movements and, for CERN, ESO and
ESA, changes to national net income (NNI) rates (a common feature
of international subscriptions whereby contributions vary according
to a country's relative wealth).
The way the arrangement worked was that in each
spending review period a part of the Science Budget was not allocated
in advance but held by the Department to cover claims by STFC
and NERC under the arrangement. These were made towards the end
of the financial year, once the impact of exchange rate movements
(and any NNI changes) were known. The sum initially set aside
for this purpose from within the Science Budget was an estimate
of what the increases might be.
For CSR07 and subsequent spending review periods
this arrangement has been modified to recognise that the STFC
and NERC, with their fuller knowledge of the amounts and timings
of these subscriptions, are in a better position to manage this
financial risk. Under this change, the 2007-08 baselines for STFC
and NERC were adjusted to include anticipated international subscriptions
claims for that year and STFC and NERC took on the responsibility
for meeting the full cost of international subscriptions. Following
the guidance in the Treasury publication Managing Public Money
the Research Councils are permitted to take out forward contracts
for currency, which enables them to fix the costs of their annual
subscriptions at an early stage in the year.
It continues to be recognised that the volatility
of exchange rates could be such that the increase faced by STFC
and NERC in any one year might be excessively large compared to
the size of their overall budget. Accordingly beyond a trigger
limit (£6 million for STFC and £2 million for NERC),
the two Councils can seek additional funding from the Science
Budget. This is similar to the process that already exists for
all Research Councils in respect of any unexpected major losses.
If such a request were to be made in future, there would need
to be discussions across all the Research Councils, amongst whom
the Science Budget has been allocated, to establish how such a
shortfall could be funded.
3. When was the Minister first told of the
nature of the cuts that AHRC has announced? What discussions has
he or DIUS officials had with the AHRC on this issue?
AHRC's Delivery Plan shows that in the period
2008 to 2011 the Council will fund a range of responsive mode
and strategic programmes, including the research leave scheme,
and a postgraduate programme. In order to respond to the national
strategic cross-Council programmes which are being given priority
in this period, the Council developed a 2008-09 budget which breaks
down as follows:
|
| Mechanism | £ million
|
|
| Responsive mode research | 43.52
|
| Strategic/CSR07 | 16.26
|
| Postgraduate | 38.57
|
| Knowledge transfer | 5.93
|
| Non-programme | 7.39
|
| Total expenditure | 111.67
|
|
It is important to recognise that for some years the Council's
expenditure on postgraduate training has been increasing. The
total number of postgraduates being supported has increased as
follows:
|
| 2005
| 2006 | 2007
|
|
| New commitments | 1,490
| 1,490 | 1,456
|
| Continuing students | 2,631
| 2,803 | 2,928
|
| TOTAL | 4,121
| 4,293 | 4,384
|
|
A key feature of AHRC's policy has been to increase their
proportion of doctoral awards being given in recognition of the
Council's role in supporting high quality research. Accordingly
the number of new PhD grants it has awarded has increased by 16%
in the last two years and 27% in the last four years. The result
of this move to more awards lasting three to four years, instead
of Masters awards mainly lasting one year, has been that at the
end of each year there has been an increasing amount of financial
commitment carried forward:
|
| 2005-6 | £22.4m
|
| 2006-7 | £26.0m
|
| 2007-8 | £29.6m
|
| 2008-9 | £33.4m
|
|
In common with the other Councils, in June 2006 AHRC was
required to make commitments across its budget as a whole based
on a flat cash trajectory (FEC apart, and that is not relevant
in relation to postgraduate training) for 2008-2011. The consequence
of AHRC's decisions early in 2006 and 2007 in relation to their
postgraduate training competitions is that a high level of committed
money is projected to be carried forward at the end of 2007-08;
a level which was always going to be challenging to manage against
that commitment planning requirement.
AHRC's Council has made its decisions on funding for 2008
shown above against that background. It is understood that the
Council is continuing to examine the scope for flexible use of
its budget in the CSR period to maximise its effectiveness.
At the AHRC Council meeting last November there was some
discussion of the level of new commitments to postgraduate training
awards which could be afforded within their settlement, but as
the reasons for the scale of decline in postgraduate training
were unclear we sought further clarification of the position.
Accordingly Ministers were advised of the revisions to AHRC's
Delivery Plan which involved more emphasis on contributing to
strategic issues, and they agreed in early December to a Delivery
Plan being published which did not contain any specific numbers
of postgraduate training awards. AHRC told officials on 4 December
that they planned to reduce the number of new postgraduate awards
to 1000 in 2008-9, but as we had already confirmed this was not
part of AHRC's Delivery Plan announcement, officials intended
to consider this issue further with AHRC in the New Year, to understand
more fully why this reduction was necessary. This communication
was not drawn to the attention of Ministers. Before this happened,
on 15 January the AHRC published a statement on their web site
without giving the Department any prior notice of its publication.
More recently there have been helpful discussions between DIUS
and AHRC officials about a number of aspects of the Council's
programme.
4. Please provide a timescale with precise dates, where
possible, of the discussion that DIUS has had with the Treasury
on the rules regarding profits made through intellectual property.
There were various discussions with Treasury during May and
June on this subject, leading up to the DTI's CSR settlement in
June. A subsequent letter from the Treasury dated 12 July 2007
confirmed the arrangements for regularising the budgetary position
of the MRC Commercial Fund. Since then there have been continuing
exchanges with the Treasury over the precise implementation arrangements.
5. Please provide figures on how much each Research Council
received for FEC and on the relationship between flat cash and
FEC (see Q 193).
The allocations to Research Councils did not include any
separately identifiable sum in respect of the estimated costs
of 80% FEC in CSR07. The allocations took account of the collective
advice from Research Councils that the additional FEC costs in
CSR07 were estimated to be as follows:
FEC Additions
|
| 2008-09
| 2009-10 | 2010-11
| CSR07 Total |
|
| AHRC | 6,350
| 10,053 | 11,796
| 28,199 |
| BBSRC | 30,135
| 43,523 | 49,824
| 123,482 |
| ESRC | 15,236
| 22,005 | 25,190
| 62,431 |
| EPSRC | 73,479
| 106,124 | 121,486
| 301,089 |
| MRC | 29,079
| 41,998 | 48,077
| 119,154 |
| NERC | 14,154
| 21,810 | 25,413
| 61,377 |
| STFC | 12,139
| 18,487 | 21,474
| 52,100 |
| Total | 180,572
| 264,000 | 303,260
| 747,832 |
|
It is expected that the move by Research Councils to funding
at 80% FEC will be completed by the end of CSR07.
The 2007-08 baselines for the Research Councils would be
the flat cash sums for CSR07, which are shown in Table 2.1 of
"The Allocations of the Science Budget 2008-09 to 2010-11"
published in December 2007 and are as follows:
Table 2.1: Science Budget Allocations
|
| £ million
|
| Research Councils | 2007-08
|
|
| Arts & Humanities Research Council |
96,792 |
| Biotechnology & Biosciences Research Council
| 386,854 |
| Economics & Social Research Council |
149,881 |
| Engineering & Physical Sciences Research Council
| 711,112 |
| Medical Research Council | 543,399
|
| Natural Environment Research Council | 372,398
|
| Science & Technology Facilities Council
| 573,464 |
| Total | 2,833,900
|
|
Department for Innovation, Universities and Skills.
March 2008
|
