The UK science sector has welcomed the government’s decision to protect investment in research and development in the autumn budget. However, many in higher education have expressed disappointment at the lack of additional funding for universities.
Announcing the new Labour government’s first budget since taking power this summer, the chancellor Rachel Reeves revealed that funding for science would be protected, with an annual average real-terms growth rate of 6.5% over the next two years.
This would take annual Department for Science, Innovation and Technology investment in R&D to £13.9 billion by 2026, including at least £6.1 billion of support for core research. £2.7 billion has been allocated for association to EU research programmes.
President of the Royal Society Adrian Smith said that it was ‘very good news’ for the science sector that research and innovation had been recognised as a ‘crucial national asset’ for delivering long-term economic growth.
‘Protecting the science budget, despite the challenges facing public finances, and investing £20.4bn in 2025/26, will create conditions that generate new knowledge, boost productivity and unlock opportunities for every corner of the UK,’ he added.
This view was shared by Tim Bradshaw, chief executive of the Russell Group, who said he was pleased the R&D budget had been protected in ‘a challenging fiscal landscape’.
‘We particularly welcome the introduction of a multi-year R&D missions programme which highlights the role of R&D in achieving the government’s top priorities, including the industrial strategy,’ said Bradshaw. ‘We are also very encouraged to hear that full funding has been made available for our association to Horizon Europe.’
However, Bradshaw pointed out that an increase in employers’ national insurance contributions would have a ‘significant impact’ on universities, adding to the funding challenges facing the sector. These changes will increase the rate of employer national insurance contributions by 1.2%, to 15%, and reduce the pay threshold at which employers start to pay national insurance, from £9,100 per year to £5,000 per year.
Raj Jethwa, chief executive of the Universities and Colleges Employers Association said this would add around £372m to the higher education sector’s pay bill – equivalent to 2.1%.
‘This comes on top of substantial increases in employer pension contributions for very many higher education institutions in the Teachers’ Pension Scheme earlier this year, falling student numbers and stagnant fee income,’ he said. ‘Higher education institutions will now be left with difficult decisions on how they can balance their budgets.’
General secretary of the University and College Union, Jo Grady, echoed Jethwa’s concerns saying that the budget was ‘thin gruel’ for those working in universities and that the rise in employer national insurance contributions would hit the sector ‘hard’.
‘Universities are crying out for increased public funding to secure their future as Britain’s last world-leading sector, yet the chancellor failed to deliver,’ she added. ‘There will be no decade of national renewal if the government’s approach to universities continues to be one of de facto disinvestment. This is not a matter of special pleading: a properly funded higher education sector is a foundation stone of economic growth.’
However, the Department for Education’s spending on England’s schools is to increase by £11.2 billion by 2026, representing a 3.5% real terms increase. This includes a £2.3 billion funding boost to the core schools’ budget and an additional £300 million for further education.
Calls for greater detail
Annette Farrell, education policy programme manager at the Royal Society of Chemistry (RSC) said the additional funding for core school budgets was something schools had been ‘crying out for’.
‘The chancellor said that this increase in school budgets will support the recruitment of 6,500 more teachers,’ said Farrell. ‘For shortage subjects like chemistry, investment is needed to attract potential applicants into teacher training and retain them and support existing teachers in the profession. We still await more detail on how the government plans to meet this manifesto commitment and how it will help address the ongoing recruitment and retention crisis.’
The budget also included an allocation of £3.9 billion for carbon capture projects, and a confirmation of support for four electrolytic hydrogen production projects located in Scotland and Wales.
Tanya Sheridan, head of policy and evidence at the RSC, welcomed the announcement that the government would protect investment in R&D, but added that the RSC was ‘keen to understand’ the implications for chemical sciences research, development and innovation ‘in more detail’.
‘The government’s decision to invest in future growth sectors, such as life sciences, green hydrogen, and carbon capture and storage, creates long-term opportunities for the chemistry workforce,’ she added.
However, she added that the RSC ‘would have liked to see more’ on how government was going to support the higher education sector, particularly as the government’s industrial strategy proposals highlight the sector’s vital role in transforming the UK skills base and achieving economic growth.