The Russell Group has urged the Westminster government to create a new “deep-tech university seed fund” to help level up the UK regions by creating spin-offs, ahead of the comprehensive spending review.
The government’s spending review, to be announced on 27 October, will set departmental spending limits for the next three years and is expected to feature major changes in English higher education, including the lowering of the student loan repayment threshold and a minimum entry requirement to qualify for loans to study at university.
The Russell Group, representing 24 research-intensive universities, has set out a series of proposals ahead of the spending review. That includes a call for a “new £200 million deep-tech university seed fund, targeted at innovative ideas within the Innovation Strategy’s seven priority technology families. This would create around 350 new deep-tech spin-outs, developing genuinely disruptive technologies, transforming regional economies and creating export revenue.”
“Domestic investors, venture capitalists and industry partners have…shown a historic reluctance to spend on deep-tech, defined as early-stage technology start-ups or [intellectual property] which require extensive research and development and capital investment before commercialisation,” the Russell Group paper says.
“Research teams developing deep-tech outside of the south-east most acutely struggle to access venture capital,” it adds.
“A new deep-tech university seed fund…could help level up communities across the country, by developing genuinely disruptive technologies that can transform regional economies and create new national export revenue streams in the next 15-20 years,” it continues.
The Russell Group’s appeal to government highlights how the pandemic has shown the importance of science to the UK. “Now, as government considers how to deal with the challenges of revitalising the UK economy, delivering on its green ambitions and balancing the books, it must find smart investments that will create jobs and boost opportunity in every town and region across the country,” it says.
Amid fears the government is backsliding on its pledge to increase research funding to £22 billion, the Russell Group says the government should increase the baseline budget by £2.37 billion each year between 2022-23 and 2024-25.
It also calls for a 20 per cent increase in quality-related research funding, a guarantee of full funding for UK participation in the European Union’s Horizon Europe scheme for the full duration of the programme, and delivery on “the long-standing commitments to fund public grants for research at a minimum of 80 per cent of full economic costs”.
On innovation, alongside the deep-tech seed fund, the Russell Group urges the government to “scale up existing innovation schemes such as the Higher Education Innovation Fund and the UK Research Partnership Investment Fund with a track-record of proven returns” and “reform VAT rules and eligibility for R&D-related tax credits to encourage increased collaboration between business and universities that will leverage further private R&D investment to anchor critical research in the UK, reduce red tape and ensure more SMEs can benefit from the expertise of the sector”.
On teaching, it calls on the government to “guarantee teaching grants on a per student basis for the duration of this spending review at levels that at least match existing funding”.
