Spending Review 2021

What’s in the Westminster spending review for HE?

David Kernohan is an Associate Editor of Wonkhe

Very little.

Those waiting for a response to the Augar review, an FE White Paper, an HE White Paper, or the (never forgotten at Wonkhe) Pearce Review of TEF will have to wait a little longer. As trailed and as presented Rishi Sunak delivered very little for higher education.

Research and development

We’d had an eye particularly on research funding – the spending review document offered £15bn for core research over the next three financial years, £1bn for ARPA-type stuff over the next four years and £1.9bn for Net Zero programmes. £11b.1bn of the R&D funding is currently allocated – with a £400m uplift for core UKRI programmes each year til 2023-24, £490m next year for Innovate UK, and a further £350m next year for UKRI programmes supporting strategic government priorities. Somewhat surprisingly, that last figure includes the first £50m of the ARPA stuff – maybe with Cummings out of the picture “high-risk, high-payoff” research will sit under UKRI?

The overall uplift for R&D in BEIS is around £740m – so there’s some new money in with that but not lots.

The government is also getting interested in sweating its “knowledge assets” – a new £17m unit and fund will support the exploitation of IP, data, R&D, technology and other intangibles. The presumption of an open government licence on everything looks to be fading, potentially bad news for researchers using such data.

Fees and funding

Perhaps clearing the way for a full Augar response, there is nothing on any changes to fees and funding for higher education.

Money going to DfE is up overall, and rises each of the next four years. There’s an additional £291m next year to preserve core funding to FE in real terms per learner, and £375m for the National Skills Fund, which will include £138m for level 3 courses, and £60m of recurrent and £50m of capital to support the roll-out of a future “flexible loan entitlement”.

There’ll be an important reform to apprenticeship funding from August 2021 – employers who pay the Apprenticeship Levy will be able to transfer unspent levy funds to SMEs, and there will be a service to match employers to suitable SMEs. Employers in construction, followed by health and social care and eventually others, will be able to frontload training for certain standards – and there’s a commitment to support apprenticeships based on flexible working patterns. As previously announced the incentive payments for employers will be extended to 31 March 2021.

The Student Loans Company will trouser an extra £64m of capital – with some of this linked to a transformation programme.

Other bits

DfE will get funding to prepare for a UK-wide domestic alternative to Erasmus+, in the event that we cease participation in the European scheme. There’s more details on this to come.

Sneaking out alongside the main release was a response to the consultation on the phasing out of RPI. The consensus was that the widely discredited measure of inflation would be phased out by 2030, and the government had already committed to make no new uses of it (the student loans system is probably the largest remaining user, everything else has switched to CPI or CPIH). Rishi Sunak wants the switchover to start in 2030, which means another few years of higher interest on loan repayments.

Towards the end of Sunak’s statement we found one line that gave us pause:

As we invest billions in the security of this country, we’re also defending free speech and democratic rule, proving our values are more than just words.”

It could be seen as part of a peroration flourish – but it also offers an uncomfortable reminder that there is a draft Free Speech (Universities) bill knocking around DfE.

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