A leaked consultation on the future of the Department for Business, Innovation and Skills suggests that November’s spending review will be accompanied by a radical overhaul of the research funding system.

Over the summer, George Osborne asked unprotected Whitehall departments to model cuts of between 25 and 40 per cent over the lifetime of this Parliament. Keen to burnish his austerity credentials, business secretary Sajid Javid has let it be known that he favours cuts to his department at the deeper end of this range. In July, as revealed in this blog, he controversially called on consultants McKinsey to help him identify where the axe might fall.

In recent weeks, the likely direction of travel has become clearer. Last month, in an important speech to Universities UK, science minister Jo Johnson said that while he remained committed to the “principle” of the dual-funding support system (currently administered through the Research Councils on one side, and HEFCE on the other), he wanted to see a “simpler system” for allocating resources.

Soon afterwards, on 23 September, HEFCE announced that “following a request from the Minister from Universities and Science”, it was delaying the publication of its planned consultation on the next Research Excellence Framework (REF) until after the spending review. This has heightened speculation that the future of the REF (and indeed of HEFCE itself) hangs in the balance, as BIS ministers look to cull the number of funding bodies and move the allocation of quality-related funding from HEFCE to the Research Councils.

In 2010, the introduction of the “impact agenda” was the price that the research community had to pay for its flat cash settlement. This time around, it seems that restructuring and “simplification” will be the deal that’s on offer in return for further investment.

As debate intensifies ahead of the spending review, science leaders circled the wagons this week with a briefing at the Science Media Centre. Sir Paul Nurse, president of the Royal Society, said that ministers would have to be “Neanderthals” to make deeper cuts, particularly after five years of flat budgets had produced a “logjam” of high quality but unfunded research.

The draft “BIS 2020” strategy, which was circulated to all staff in mid-September. Photograph: BIS

Until now, BIS has remained tight-lipped about its plans, and has refused to comment publicly on any advice it has received from McKinsey. But an internal consultation document, entitled “BIS 2020: What–Why–When–How”, circulated “for use in team discussions” and obtained by the Guardian, gives the best insights yet into Javid’s vision for his department.



The case for radical change is set out in stark terms. Despite “huge strides in the last five years”, BIS is “too complex”, with “45 partner organisations and 80+ locations”, such that “those who deal with us find us hard to understand and navigate”. BIS “currently costs too much to run”, and its users “need a better service” with “faster and more efficient access to advice and funding”. To address these challenges: “the Secretary of State asked BIS in June to develop options...Consultants [i.e. McKinsey] validated the options we developed. He has now asked us to take these options forward through a full change programme.”

The document explains “what will change by 2020”, with headlines including:

Reducing the number of partner organisations by more than half [i.e. from 45 to around 20];

Cutting operating costs by 30-40 per cent, delivering annual savings of c. £350m;

Consolidating the “BIS family”, which is currently spread across around 80 sites, into 7 or 8 “centres of excellence”.

BIS staff are now being consulted on which organisations can be merged and how, which sites will be retained or closed, and what these reductions will mean for budgets, and headcount. All of these factors will of course be shaped by the outcome of the spending review, with a detailed implementation plan expected to follow soon afterwards in January.

None of this is very surprising. It’s precisely the kind of strategy you would expect the sharp-suited cost-cutters at McKinsey to deliver. But there is scant reassurance in the “BIS 2020” plan for universities and researchers.



Indeed, it is impossible to see how the goal of reducing the number of bodies by “more than half” can be achieved without massive turbulence in the funding system. HEFCE’s survival is now acutely uncertain, as is the future of the REF as the allocation mechanism for £1.6 billion of quality-related funding each year. Innovate UK may also be scrapped, or have its budget “tucked in” to the Research Councils, requiring a real terms cut. And despite Sir Paul Nurse’s insistence this week that mergers are “not on the table” as part of his Research Council review, the seven tribes of RCUK must be vulnerable in any push to consolidate BIS bodies.

A more fundamental question is what – beyond cuts – such radical reforms to the research system are designed to deliver? On any reading of the international data, the UK system is highly efficient and delivers superb results. As @bisgovuk tweeted last night, on the release of the latest Times Higher Education rankings, “Excellent news that UK boasts nearly 1 in 10 of the top 800 universities worldwide, with 3 in top 10!”

Thanks to some uncomfortable belt-tightening, the UK research system has managed to survive five years of flat cash, despite public investment falling to just 0.49 per cent of GDP, one of the lowest levels among OECD countries. As growth returns to the economy, the government should be looking to increase its investment in research, in order to meet its wider objectives for innovation, productivity and knowledge-intensive skills and jobs.

Instead, we are faced with the prospect of five more years of flat cash (or perhaps worse), accompanied by massive upheaval in the structure of the funding system. There is no hard evidence to support these changes, nor has there been any serious attempt to justify the benefits in terms of efficiency, outcomes or performance. Indeed, insofar as there are any “iron laws” in science policy, it is diversity, rather than simplification of funding streams, which is key to a healthy and dynamic research system.

Sir John Savill, chief executive of the Medical Research Council, says it is an “illusion” to think that a merger of the councils will generate significant savings, and that he will “die in a ditch” to protect the dual support system. But BIS ministers and officials appear convinced that the REF is overly cumbersome as a funding allocation mechanism, even though the evidence shows that it costs a fraction of the research council system to administer. As a result, a metrics-based alternative to REF (run by the Research Councils) now appears to be back on the table, despite that option being roundly rejected by my review of metrics in July.

Like John Savill, I’m particularly concerned about the future of quality-related (QR) funding, which is crucial to the social sciences and humanities, and acts as a funding “multiplier” across the wider system, by giving universities the flexibility to match their own resources to grants from charities, foundations and businesses. Already, pressures in the funding system are forcing some universities to decline charitable funding and leading companies like Rolls Royce to warn that they may move R&D abroad. It’s also far from clear how QR money could be allocated on a lighter-touch basis, without losing positive elements of the REF system, in terms of measuring and incentivizing research quality and wider impacts.

All of these uncertainties in the funding system are exacerbated by a planned overhaul of university teaching and regulation, through the introduction of a Teaching Excellence Framework. A green paper on the future of higher education is expected to surface within the next two weeks. As one academic tweeted last week, “Imagine English HE 5 years from now with no HEFCE or REF but a beefed-up QAA and a TEF. Still a cloudy acronym soup but big shift in focus?”

So these are worrying times for the future of our research system. Hopefully some of this speculation will prove unfounded, or HM Treasury will intervene at the last minute to reject some of BIS’s more radical and poorly-evidenced reforms. A great deal hinges on how much noise we as a community make, the quality of the evidence we present, and the breadth of the alliances we build over the next few weeks.



This is why, as chair of the Campaign for Social Science, I’ll be standing shoulder to shoulder with friends and colleagues from the natural sciences and engineering on 26 October in London’s Conway Hall to insist that science is as vital as ever. I hope you’ll join us.

James Wilsdon is professor of science and democracy in the Science Policy Research Unit (SPRU) at the University of Sussex (@jameswilsdon). He recently chaired the Independent Review of the Role of Metrics in Research Assessment and Management.



