Explainer: The dual support system

Earlier this week the British Academy released a report asking if the dual support system is fit for the future. The authors explained:

“Dual support is often described as one of the defining strengths of the research landscape. By combining long-term funding for institutions with competitively awarded project funding, it has helped sustain internationally competitive research, institutional autonomy, and long-term investment in the research capacity needed to solve societal challenges.”

But just what is the dual support system, and why is the university sector so keen to defend it?

As the name implies, the dual support system refers to two complementary funding streams that universities receive for research. There are project funds that support a mix of, well, research projects, researchers, facilities, collaborations and collaborations. There is also strategic institutional funding. This funding is paid in a block grant for institutions to spend as they like.

The project funds are relatively straightforward to explain but they are multitudinous in their manifestations. UKRI, through its research councils, sets out projects for researchers, institutions, businesses, and other eligible research institutions. Broadly, there are two kinds of project funding. Applicant-led, where projects can be broad-ranging based on a researcher’s expertise, and targeted funding, where a project must meet the specific criteria set out by the funder.

The block grant element of dual funding is worth about £2bn per year to the university sector. It comes in two main forms. Quality Related (or QR) funding, and its devolved equivalents, administered by one of the Department for the Economy Northern Ireland, Medr, Scottish Funding Council, or Research England.

This funding is allocated through a formula which accounts for the quality, volume, and relative cost of research. Quality is measured by the Research Excellence Framework (the big peer assessment of research quality). The volume measure is calculated by the number of staff with “significant research responsibility” multiplied by the quality of research. This means providers with a large volume of 4* research (the highest REF rating), and a large number of researchers, will receive the most funding. Relative cost of research is apportioned depending on subject type. Under this system, high-cost laboratory and clinical subjects receive the most funding.

There are different kinds of QR funding. The element explained above is what is referred to as “mainstream” QR funding. Then there is the QR research degree programme (RDP) supervision fund – this is allocated based on PGR student numbers. There is the QR charity support fund, money to providers to support the research universities do with charities. There is the QR business research element. This is allocated proportionately to the volume of research providers carry out with business and industry. And there is QR funding for National Research Libraries. This supports five national research libraries.

The second part of the block grant element is Higher Education Innovation Funding (HEIF). HEIF is worth £280m per year to the sector. It is a joint programme between the Office for Students (OfS) and Research England. HEIF can only be used for knowledge exchange activity, the process through which academics and businesses work together to share insights, and it should now be used on activities that demonstrably encourage economic growth. HEIF is allocated using an algorithm which draws on the HESA Higher Education and Business Community Interaction survey which looks at research, consultancy, regeneration, facilities, and IP income, as well as the OfS Annual Financial Return for information on income from non-credit bearing course fees, and knowledge transfer partnership income.

The dual support debates

There are almost as many debates about dual support as there are funding opportunities but they tend to coalesce around three key themes. First, money. Projects are only funded at 80 per cent of full economic cost (FEC) which means that institutions must provide the other 20 per cent. In reality, the actual amount of funding provided from different sources is usually below 80 per cent. As the extra 20 per cent comes from universities’ own resources, the viability of the research system is intertwined with the viability of the system as a whole.

Next, measurement: the metrics that underpin quality-related funding are a mixture of research impact, research culture, and research environment. The extent to which funding should focus on excellence alone, compared to the conditions in which that research is created, is one of the most contested debates in higher education. The ability to measure culture – specifically related to equality considerations – has been particularly contentious.

Finally, manageability and methods. The volume of applications UKRI receives far outstrips the availability of funds. Current awarding rates are at 19 per cent. This has led to calls for new mechanisms like lotteries, reforms to peer review, increased use of AI, and using applicants as part of the review process. This is aside from concerns about the bureaucracy that surrounds application, delivery, and the maintenance of the funding system. There are also significant inequalities in who applies for funding and who is rewarded funding.

The dual funding model has been a defining feature of UK research. At its best it combines the freedom for researchers to pursue what is interesting to them and the discipline for funders to encourage exploration of things which they, and by extension the government, deem valuable. At its worst, project funding is hard to win, block grants do not cover real costs, and the general decline in funding for universities has endangered the system.