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Exploring the politics of hitting 2.4 per cent

A statistical quirk means the UK, without doing anything new, may have hit its 2.4 per cent R&D target. James Coe considers what happens next.
This article is more than 1 year old

James Coe is Associate Editor for research and innovation at Wonkhe, and a partner at Counterculture

It rarely comes with a bang but with technical remeasuring of research density. It seems like the UK may now be spending 2.4 per cent of GDP on R&D.

As Josh Martin lays out in his superb article, ONS believe the UK survey of research activity has been significantly underestimating the density of research activity. This in turn means the UK, without doing anything new, may have hit its vaunted 2.4 per cent target.

The absolute key point is that this does not mean there is more research investment. Growing the size of the research economy relative to the economy overall means either investing more in research or maintaining investment relative to a decline in GDP. The latter might be taking place but there is no evidence of research investment of that scale to make the former likely.

Now what?

One of the political consequences of this could be that the government pulls back on research investment. Several commentators have made the argument that as austerity returns the R&D budget is an easy target for cuts only made easier by hitting the 2.4 per cent target. At the most recent Science and Technology Committee the science minister Nusrat Ghani has confirmed that funding secured by the previous minister will be maintained. This is both surprising and encouraging.

When asked directly by the same committee on what the impact of hitting 2.4 per cent is the minister was again encouraging. She said that this meant that we need to think about how we measure the size of the research economy more accurately. Secondly, she talked about 2.4 as a “starting point” without putting a new target in place. And thirdly, she hinted that as well as the quantum of funding its distribution is also important. Levelling up might be dead but it’s useful to have a clear reminder that excellence does indeed exist everywhere.

There is therefore a dual challenge considering the ONS revision. The first is what a new target should be if it turns out 2.4 has been reached. As the minister rightly pointed out this first requires further work by ONS to definitively establish the level of investment today. It might be that the UK aims to replicate the cluster of countries like Japan, Denmark, and Belgium, hovering between 3 and 3.2 per cent of GDP spend.

It might be that there is a target of a baseline of investment then pegged to the growth of the wider economy therefore removing the risk of a shrinking GDP justifying shrinking spending. Or it might be that the government really stretches its ambition and looks to have spending closer to 5 per cent over a longer time horizon, matching the likes of Israel. Investing in research is investing in the growth of the economy.

What should universities do?

The second challenge is how the higher education sector responds to this moment. It has been a good week for research with the announcement of the reformed Science and Technology Committee, confirmation of an ambition to grow beyond 2.4 percent, and commitment to the previously secured spending settlement. There is no new activity happening but there is confirmation that the old order, for now, remains in place. This is no small victory.

The response is tricky. If association to Horizon is not possible it is likely that more funding than currently allocated to Plan B will be necessary in the long-term. The UK has historically been a net beneficiary of Horizon and establishing international networks afresh will be complex and expensive. It would be prudent for universities to put their energy and resources into making Plan B a success.

There will also have to be a reckoning on the extent to which universities double down on the levelling up agenda which has been the hallmark of the sector in the past few years. It is much harder to make the case for the distributive benefits of research with a government who is more interested in growth for growth’s sake and where the economy may overall contract.

The sector will take a signal from funders who continue to balance a regime which recognises excellence can be found everywhere against the imperative to address historic underinvestment in some areas. If funding is as secure as the minister has suggested these decisions can be made more clearly if not more easily.

In all, it is an encouraging start for research against the background of enormous economic challenges. Hitting 2.4 per cent does not solve any issues but it presents an opportunity to push forward into a research led economy.

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