5 Achieving a functional market
72. Neither the Finch Report nor the Government
assessed the current functioning of the scholarly publishing market
in the formation of their policies. Despite the massive profit
margins of the large commercial publishers, driven up by public
sector expenditure, the Government made it clear to the Finch
Group that it was important not to destabilise "what is most
valuable in the research communications system".[105]
This was subsequently confirmed as a priority:
It was accepted that publishers, including learned
societies, provide a valuable service by both administering a
highly respected peer review process and providing the necessary
investment for a globally successful UK based research publishing
industry. To sustain the advantages of the present publishing
arrangements, whilst simultaneously exposing the industry to radical
change, requires payment of an APC under Gold OA.[106]
73. A recurring theme in this inquiry has been
that elements of the scholarly publishing market are dysfunctional.
The systematic increase in subscription prices over inflation,
the opacity of pricing due to non disclosure agreements, and the
APC pricing differences between comparable hybrid and pure Gold
open access journals have been set out earlier in this Report.
Together, they demonstrate a lack of transparency and competition
in the market which is deeply concerning.
74. The evidence we received strongly suggests
that implementation of the Government and RCUK policies will make
the situation worse. Publishers have been incentivised to add
a Gold open access option to their subscription journals. It is
highly likely that this will lead to longer embargoes and less
access. It could also lead to double payments by UK institutions,
which have to maintain their subscription charges while paying
APCs as well. The costs of publishing services are increasingly
disassociated from the value of the actual services provided.
We heard evidence that costs of peer review, formatting, editing
and other publisher services are exaggerated by publishers, keeping
prices artificially high.
75. We received evidence showing that the development
of a functional market is also hampered by the fact that authors
are desensitised to the prices of journals in which they publish,
because the purchasers (predominantly libraries) are not the consumers
of the product. The Government also is desensitised to the costs
of its policy, claiming that since APC costs would be carved out
of the ring-fenced science budget, "it is not a public expenditure
issue".[107] We
disagree. The Government is accountable to the public for where
and how public money is spent. Without price sensitivity, and
given that the economic modelling for this policy was less than
robust, the Government's expectation that "publishers will
need to set their APCs at a level that allows them to effectively
compete"[108]
seems overly optimistic.
76. Both the House of Commons
Science and Technology Committee's 2004 Report, and the Finch
Report, highlighted the fact that VAT currently applies to e-journals,
but not to print journals. This creates a clear disincentive for
online access, and therefore to open access. Despite this anomaly,
the Government has asserted that it does not consider it worthwhile
to pursue a reduction in VAT rates with the European Union.[109]
We disagree, and believe that the Government should be willing
to increase its efforts to remove or reduce this barrier.
77. If RCUK and the Government
continue to maintain their preference for Gold, they should amend
their policies so that APCs are only paid to publishers of pure
Gold rather than hybrid journals. This would eliminate the risk
of double dipping by journals, and encourage innovation in the
scholarly publishing market.
78. The evidence we saw suggested
that authors have little price sensitivity when they choose a
journal in which to publish.[110]
We recommend that RCUK
amends its policy to allow grant funds to be used for publishing
charges, which is by far the most common model internationally.
This would re-introduce price pressure by prompting authors to
make an informed decision on where to publish.
We recommend that the Government
endorse genuine price transparency from publishers so that it
is clear to subscribers which services and costs are and are not
included in the overall subscription price, enabling subscribers
to assess the costs and benefits of purchasing.
79. We
strongly agree with the recommendations of the House of Commons
Science and Technology Committee and the Finch Report that the
Government should work to introduce a reduced VAT rate for e-journals.
Given the emphasis the Government has placed on the benefits of
increasing open access, the Government should seek a derogation
on this point from the European Commission.
80. We further recommend
that the Government indicates clearly that non-disclosure clauses
should not be included in publishing contracts which involve public
funds. In the first instance, this should be achieved through
dialogue between Government, publishers and universities. If the
use of non-disclosure clauses persists, then the Government should
consider referring the matter to the Competition Commission.
105 https://www.gov.uk/government/speeches/public-access-to-publicly-funded-research Back
106
Ev 41 Back
107
Q121 Back
108
Ev 39 Back
109
Ev 58 Back
110
Ev 83 Back
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