Brexit Could Trigger £1 Billion Cut In Annual Funding For UK Research Base

Independent data research, led by Digital Science’s Daniel Hook and Martin Szomszor reveals that leading British institutions and companies, including the University of Cambridge, the University of Oxford, Rolls-Royce, BT and the BBC, could stand to lose significant European Union (EU) funding for R&D if the UK government doesn’t plug the gap.

The UK risks losing EU research funding to the tune of £1 billion per year if the public votes to leave the EU on 23rd June, according to our new research released in our latest Digital Research Report titled: Examining Implications of Brexit for the UK Research Base.  Currently, a quarter of all public funding for research* in the UK comes from the EU.  In 2015, the amount of new grant funding awarded to the UK was £967 million.  Today, we call upon those advocating Brexit to commit to making up the shortfall in order to protect the UK’s research base.

According to our research, the UK has been the second highest recipient of EU research funding over the last decade, with £8,044,801,711 from 2006 to 2015, just behind Germany with £8,335,695,125. However, the UK is significantly more dependent on EU funding than Germany and other research-intensive countries, as the UK as a whole contributes just 1.63% of the nation’s GDP to research (compared to 2.85% for Germany).  British businesses contribute just 1.06% of GDP toward research and development – almost 80% lower than businesses in Germany and below the averages for EU-15 and EU-28 nations.

While the exact amount of EU funding that would be lost as a result of Brexit is still unclear,  our data shows that just 7% of the EU’s research funding has been awarded to non-member states in the last decade.  The research indicates that, should funding be significantly decreased, the loss of funding would be felt across the majority of the UK’s universities and research institutions, as well as a number of major companies.

Universities and research

Some of the UK’s leading universities are disproportionately dependent on EU funding, with Cambridge and Oxford respectively relying on 20% and 23% of their EU & UK research body funding from the EU. Further, institutions such as the University of Greenwich have an EU:UK funding ratio of 64%:36%, whilst the University of Wolverhampton’s funding structure for research represents a similar split of 67%:33%. Our research finds that while all parts of the UK are reliant on EU funding to some extent, the areas with the highest dependency overall are South West England, outer London and specific parts of North England and Scotland.

Our research also finds that:

• 41% or £126m of public funding over the last ten years for research principally classified as “oncology and carcinogenesis” is currently from the EU.  While this figure doesn’t include funding from CRUK and the Wellcome Trust, two major sponsors in this area, it is still a significant funding tranche. The biggest recipients are UCL, University of Newcastle and University of Sheffield.
• 94% or £11m of UK & EU government funding for economic theory comes from EU sources. Research principally classified as Applied Economics is better off in percentage terms with just 33% of government funding originating in the EU, but of a larger pot – almost £118m of EU funding has flowed into Applied Economics over the last ten years  The biggest recipients are University of Southampton, Procter & Gamble, University of Leeds and University of Birmingham.
• 67% or £19m of UK & EU funding for Evolutionary Biology in the UK over the last ten years is provided by EU funding, with the biggest recipients being the University of Sheffield, University of Exeter, UCL, Aberdeen and Cambridge.
• 62% or £13.5m of UK & EU government funding over the last decade for Nanotechnology comes from the EU. The biggest recipients are the University of Glasgow, CTech Innovation and the University of Cambridge.
• Forestry Sciences receives close to 53% of its governmental funding from the EU, and withdrawal of EU funding would significantly adversely affect departments at Universities of Aberdeen, Stirling, Cambridge and Liverpool as well as the Orkney Fisheries Association.

British business

The research finds that funding to support research in the private sector has totalled tens of millions of pounds over the last decade. Rolls-Royce, for example, received £51m from the EU between 2006 and 2015 (12.9% of total UK & EU government funding to the company); BT received £23.8m from the EU (79.8% of its total UK & EU public funding); and the BBC won grant funding of £2.87m from the EU for its research activities, compared with £4m from UK sources.

Commenting on the research, Daniel Hook, our Managing Director says:

“The UK’s economy is increasingly a knowledge and information economy and the UK’s research base is, in many ways, one the UK’s greatest hopes for long-term prosperity. While the UK has remained highly internationally competitive and successful and has won a large portion of EU funding, the UK has not invested at a national level to ensure that we keep up with competitors in our own right without EU assistance.  We don’t want the UK to become the “poor cousin”, unable to host collaborators or unable to travel due to lack of funding. Rather than allowing the UK to gain an even better position on the global stage by having an excess of funds to deploy, EU funds have been used to prop up and cover systemic issues with how we chose to fund research in the UK both at a governmental and corporate level.  Brexit, and the loss of EU funding for the UK’s research base, represents a number of severe threats to leading British success stories in the research sector, unless the UK government makes up the shortfall.”

The research we have compiled was based on data from Dimensions from ÜberResearch (one of our portfolio companies) and GRID our global, open database offering unique information on research organisations.

Download the full report via Figshare here 

* Average 24% of all money awarded over the last decade