Who will plug the funding gap in the event of Brexit?

On 23 June the United Kingdom will go to the polls to participate in the most important referendum in decades: to remain as an integrated partner in the European Union or to loosen ties to Europe and to go it alone.

The majority of the debate has revolved around immigration, issues of sovereignty and financial concerns. The quality of debate, however, has been poor: beleaguered by inaccurate or unsubstantiated claims; centring on scaremongering and sordid allusions of presumed political destinies; guided by opinion rather than hard facts and data.

Given the high-profile international standing of the UK research base and the critical role that it plays in the long-term economic, social and cultural 'health' of the country, Digital Science decided that there was a need to inform the debate. To do this, we wrote a data-driven report exploring the ways in which Brexit might affect the UK research base.

The report, Examining implications of Brexit for the UK research base, revealed that, over the past decade, the UK research base has developed a structural dependence on funding from EU sources. Were the UK to be excluded from participating in the competitive funding programmes in the EU, the UK government would have a limited period of time to plan to adequately plug the ensuing funding gap.

Nearly a quarter of all public competitive funding for research in the UK comes from the EU, with the remainder being supplied by the seven research councils (Research Councils UK), Innovate UK and the Royal Society. The funding landscape in the UK is, of course, complex with significant funding being provided by core research funding from from the Higher Education Funding Council for England (QR funding), which accounts for around 37.4% of government funding to support research.

Additionally, the charity sector is a significant participant in funding UK research with the Wellcome Trust and Cancer Research UK making major contributions. The more progressive industrial players also enhance the funding landscape with financial and partnership support.

However, to underestimate or belittle the role played by EU funding against the background of a real-terms freeze on Research Councils UK and Innovate UK spending over the last decade is a dangerous route to take.

Making up the shortfall

In 2015, the UK benefitted from winning £967 million (US$1.37 billion) from EU public sources. In our report, we ask those advocating Brexit to commit to making up the shortfall in order to protect the UK’s research base.

Our research shows that the UK has been the second-highest recipient of EU research funding, garnering 16% of the money available between 2006 and 2015, which amounts to just over £8 billion.

Of course, there are two ways to react to this statistic: one is to acknowledge the success of UK researchers in winning this level of funding, which is just behind that of Germany (which won £8.3 billion over the same period); the other is to be concerned that this money has now become a structural necessity.

Although the sums of money that the UK and Germany both won between 2006 and 2015 are highly comparable in absolute terms, when considered in the context of the larger research landscape in each country, grounds for concern do emerge.

The UK is significantly more dependent on EU funding than Germany and other research-intensive countries, as just 1.63% of the nation’s gross domestic product, or GDP, goes to research (compared to 2.85% for Germany). British businesses contribute just 1.06% of GDP towards research and development – almost 80% lower than businesses in Germany and below the averages for EU-15 and EU-28 nations.

While the exact amount of EU funding that would be lost as a result of Brexit is still unclear – and would be determined by the eventual nature of the relationship between the UK and the EU – we know that just 7% of the EU’s research funding has been awarded to non-member states in the past decade and, should funding be significantly decreased, the loss of funding would be felt across the majority of the UK’s universities and research institutions, as well as a number of major companies.

EU funding has contributed significantly to a number of important areas of research in the UK over the past decade. To take just two examples:
  • • Oncology researchers in the UK have been particularly successful in winning EU funds with more than 15.72% of EU funding in the past decade being awarded – a higher proportion than any other country and well ahead of the second most successful, which was the Netherlands at 12.57% of EU funding available in the field.

    The biggest loser in pure financial terms, if the UK were barred from participating in EU funding for research principally associated with oncology, would be University College London, or UCL, which has received about equal amounts from the EU (£14.8 million) and UK (£15.9 million) public funders in the 10 years from 2006. Of course, UCL has been extremely successful with the Wellcome Trust as well, from which it has received around £8.4 million in the same time period.

  • • Although the UK is relatively slightly less successful when competing in Information Systems research across Europe, with 9.3% of the total EU pot, behind Germany (15.9%), Spain (9.9%) and Italy (9.71%), this still accounts for almost £330 million of funding in the last 10 years versus a Research Councils UK contribution to the same field of around £380 million.

    Notably, the universities of Edinburgh, Sheffield, Surrey and Reading would be the top four financial losers in this critically important research area in the event that they would no longer be able to access EU funding.

    All four institutions have won more than £20 million, and in the case of the University of Edinburgh more than £30 million, from the EU since 2006. While the University of Edinburgh has the largest absolute financial dependency, just 60% of their public competitive funding originates from the EU. This compares favourably with a 75% dependence for the University of Surrey; an 85% dependence for the University of Sheffield and a 95% dependence for the University of Reading.
Of course, even in the worst case, there will be other funding sources from industry, charities and the like and looking at narrow subject classifications misses the effects of funding in allied areas. However, it is undeniable that there is a sizable amount of money from Europe underpinning key research areas.

Europe’s poor cousin

The UK research base is an outstanding global performer in research, but it has long been relatively underfunded. While the UK has remained highly internationally competitive and successful and has won a large portion of EU funding, the UK has not invested at a national level to ensure that we keep up with competitors in our own right without EU assistance.

We don’t want the UK to become the 'poor cousin', unable to host collaborators or unable to travel due to lack of funding. The UK’s ongoing capacity to participate as an equal-status collaborator as leading-edge research becomes more of an international enterprise is arguably the most important facet of the research infrastructure that might be compromised in a leaner funding environment.

To date, rather than allowing the UK to gain an even better position on the global stage by having an excess of funds to deploy, EU funds have been used to prop up and cover systemic issues about how we have chosen to fund research in the UK both at a governmental and corporate level.

The financial argument put forward by many in favour of Brexit is that the UK will be better off from not investing in EU membership, but this political tactic is just a ‘quick win’ and pulls focus away from long-term planning for economic prosperity – unless the UK government makes up the shortfall.

Dr Daniel Hook is the managing director of Digital Science, a technology company serving the needs of academic research, supporting more than 250 academic institutions worldwide. These include more than half of the Ivy League, 15 of the top 25 research universities in the world and over 100 leading research centres around the globe.