Brexit could leave £1.5 billion funding hole for research

The UK government would be left having to fill a £1.5 billion (US$1.9 billion) hole in funding for research if its Brexit strategy leaves it unable to join the European Union’s Horizon Europe research programme from 2021, according to a new report commissioned by the universities minister.

Until now, the cost to the UK of participation in EU research and innovation programmes has been met within the UK’s wider financial subscription to the EU. In future, these costs will need to be justified alongside competing demands for public spending, the report says.

The report’s authors – Professor Adrian Smith of the Alan Turing Institute and Graeme Reid, chair of science and research policy at University College London – warn that if the government decides not to associate with Horizon Europe because the terms of association do not deliver sufficient benefit to the UK, then they are not convinced that a persuasive case can be made for sizeable levels of public spending on activities that replicate, line by line, EU research and innovation arrangements in the UK.

However, they do find “compelling arguments for public sector investment to stabilise and protect the assets, infrastructure and capabilities that have been created by previous decades of participation in EU research and innovation”.

They also say that if the UK does not associate there will be “powerful arguments for additional UK public investment – redirecting funds that previously went to the EU – on wider forms of international collaboration”.

The amount of funding required to fund stabilisation, protection and wider forms of international collaboration would be similar to the amount received in the past from EU programmes, which amounts to an additional £1.5 billion per year.

The report advises against the disruption of existing research and innovation activities to release resources for their recommendations.

“Such disruption would destabilise the UK’s highly successful research and innovation ecosystem just at a time when it faces uncertainty and change. This in turn would have unpredictable effects on businesses and charities contemplating new investments in UK R&D,” the report says.

Loss of ERC grants

One area of particular concern to researchers is that, without associate membership, access to European Research Council (ERC) grants would be lost. During 2015-17, when just over €4.5 billion (US$5 billion) of European funding was secured for research and innovation activity in the UK, just over a quarter of European funding (26%) came to the UK via the ERC.

Researchers regard the ERC as a “highly effective and respected facilitator of excellence-driven blue-skies research”, due to its many unique characteristics, the report says. These include the size and length of grants, the fact that they are open to all nationalities and there is a freedom to move institution and country as well as to explore ideas as they emerge. Highly valued is the fact that excellence is the sole criteria for evaluation.

It was widely agreed during the consultation for the report that in the absence of association, new arrangements would be needed to support excellence-focused blue-skies research in the UK. This would require a national public sector blue-skies funding scheme that could reflect and improve many of the best features of ERC funding, including using excellence as the sole criterion for evaluation, the report said.

The disproportionately negative effect of loss of ERC grants on particular sectors and disciplines such as social sciences and humanities and the current shortage of funding for these disciplines in the UK was also a widely raised cause of concern.

Commissioned by universities minister

The report, Changes and Choices: Advice on future international collaboration on research and innovation, commissioned by the Minister of State for Universities, Science, Research and Innovation in the outgoing minority Conservative government, was published on 4 November.

Smith is a former vice-chancellor of the University of London and before that was director-general, knowledge and innovation, in the Department for Business, Innovation and Skills. Reid is a former specialist advisor to the House of Lords Science and Technology Committee during their extensive enquiries into Brexit and a member of the government’s High Level Group on EU Exit, Universities, Research and Innovation.

The UK is currently in the early stages of a general election campaign during which the question of whether to leave the EU – either at all, with a deal with the EU, or without a deal – will dominate, as the country is riven with division on the matter.

With people’s views on Brexit strongly cutting across political party lines, the result is difficult to predict, but the most likely outcomes are either a Conservative majority that will seek to usher Brexit through before the end of January or a Labour-led minority government supported by Remain parties that would negotiate a new deal and put it to the public with a choice to Remain on the ballot, a process that Labour claims could be completed in six months, although EU officials say that may not be a realistic timetable.

Any form of Brexit would raise questions about the UK’s continued involvement in Horizon Europe, and the government has consistently made its position clear that it would like the option to associate but is also exploring “ambitious alternatives to deliver positive outcomes” for science, research and innovation if the UK does not associate, the report says.

For UK researchers the uncertainty around Brexit is compounded by uncertainty around the EU’s own plans for Horizon cooperation with non-EU members.

While promising more flexible deals with non-EU research partners, the European Commission has not yet proposed specific terms for associate and third country membership for the new Horizon programme and has said it will not begin international negotiations until after Horizon Europe has been finally approved next year.

Commission officials have said parts of the Horizon Europe programme could be closed to non-EU partners.

‘Exciting new vision’

However, regardless of whether the UK associates with Horizon Europe, the report advocates that Brexit be used as a stimulus for an “exciting new vision for the UK”.

“This should focus on the government’s commitments to raise overall levels of R&D investment, to reduce regional disparities in wealth and opportunity and to work towards a new global positioning for the UK,” the report says.

That vision, the report says, should involve striving towards or beyond the government’s declared aim of raising overall levels of R&D investment to 2.4% of gross domestic product (GDP).

This would involve:

• • An international version of the highly successful UK Research Partnership Investment Fund should run competitions with sizeable rewards for the universities or research institutes that attract large amounts of foreign direct investment in R&D to the UK.
  
  
• • A coherent Global Talent Strategy, combining reforms to immigration policy with a suite of fellowship and postgraduate programmes to attract and retain many of the world’s most talented researchers in the UK.
  
  
• • Substantial additional funding for basic research, recognising that significant levels of support for this important work currently come from EU collaborations.
  
  
• • A flagship programme of research fellowships offering large awards over long periods of time for exceptional researchers in all disciplines to expand the frontiers of knowledge in areas they have identified. Awards would be overseen by a prestigious international faculty of peer reviewers, recruited through national academies in several countries.

The report also suggested having two major new funding streams to capture fast-moving and unexpected funding opportunities.

These should include additional financial support through quality-related (QR) funding for the “spontaneous, organic collaborations that are woven into the fabric of research and innovation but can so easily be inhibited by funding models that are tied to specific projects”.

A second strand would be an agility fund enabling the UK to invest in emerging international programmes of significant potential benefit to UK research, but also to capture opportunities that arise unexpectedly, including during interactions with other countries at ministerial level.

The report recommends establishing a new, stand-alone public body that would manage most or all of the new funds, becoming a ‘champion’ for international collaboration.

The authors stressed that international collaboration is deeply embedded in the research and innovation community across the UK and is not an optional extra.

“The persistent focus on excellence in the funding of research and innovation in the UK has paid huge dividends. Excellent research delivers high levels of economic and social impact across the country. It is a magnet for foreign direct investment in R&D which is vital to increasing overall investment in the UK. And it attracts talented researchers from around the world who go on to deliver further excellent work. We see a compelling case for that focus remaining in future.”

Involvement in EU programmes highly valued

They said the UK’s involvement in previous EU research and innovation programmes has been valued highly across the research and innovation community.

That involvement has provided access to a common protocol for collaboration across a sizeable population of researchers. It has also provided additional funding. It has diversified the range of funding opportunities, provided access to research facilities and delivered numerous intangible benefits.

“Many of those we consulted were strongly committed to the principle of association. Some consultees were apprehensive about even exploring contingencies,” the report said.

Alistair Jarvis, chief executive of Universities UK, responding to the release of the report, said: “Securing associated country status to Horizon Europe will help the UK to continue to work seamlessly with research partners in, and beyond, Europe and attract the brightest minds from across the world.”

Dr Greg Walker, chief executive of the universities’ association MillionPlus, said: “Given there is a near-consensus that the UK should associate to the Horizon Europe programme in the 2020s, I would hope that the contingency plan contained in the report remains just that.”

Jarvis added that the report is right to recommend a balance between flexible funding and funding which would support specific international collaborations.

‘Base funding on excellence’

“Research funding decisions should be made based on excellence, not political priorities. We support the emphasis on further improvements in visa policy and increased funding for research fellowships.”

He said ensuring sustainable funding for institutions is crucial to enabling universities to realise their potential and help the government achieve its ambitious Industrial Strategy targets, which includes increasing the UK’s investment in R&D to 2.4% of GDP by 2027.

But Walker said: “The focus should shift to how we can supplement participation in Horizon Europe with a long-term step change in the UK’s investment in research and innovation, that goes beyond the 2.4% of GDP in the report, aiming instead for a more ambitious 3% target that matches key OECD competitors”.

The report’s focus on ensuring that the post-Brexit ‘Shared Prosperity Fund’ is fully aligned with the research and innovation agenda – and genuinely fills the gap left by European structural funds – is crucial, he said.

“We now need a commitment from all parties in their election manifestos to really shift the gear in relation to this essential investment in our future prosperity.”