Capital Spending – a closer look

Earlier today I said that capital spending on science  and engineering would be down by 41% by the end of the Spending Review period in 2015. This is based on the Science Budget Allocations which came out earlier today.

But if you look at the total spend on capital over four years, the figures are slightly different.

  • Capital spending at the Department for Business, Innovation and Skills (BIS), was set at £4.1bn over four years under the terms of the Spending Review. If it had continued at present levels, the total would have been £7.2bn. So we’re looking at a 43% reduction.
  • Today’s Science Budget Allocations set out that capital spending on research will total £1.9bn over four years. If we had a flat-cash settlement, then we’d have spent £3.5bn. So we’re set for a 45.7% cut, bigger than the overall BIS capital reductions.
  • In particular, Research Councils have been allocated £802m for capital spending over the next four years – which is a 49% reduction on what a flat-cash settlement of £1.57bn would have been.

So research in general, and the Research Councils in particular, look set to bear a slightly-greater-than-proportional share of the pain in terms of BIS’ capital cuts.

However - this doesn’t take into account the £220m set to be spent on the new cutting-edge UK Centre for Medical Research Innovation (UKCMRI). Ordinarily such spending would be expected to come from BIS, via the Medical Research Council. But with the Department for Health (DH) seeing real-terms rises in its budget, partly thanks to an election promise by the Conservatives, the Government has decided that this £220m should come from health spending.

Once that £220m is included in the capital settlement, the Research Councils look set for an overall 35% capital spending cut over four years, and research in general sees a 39% reduction.

Although the UKCMRI will generate findings across science and engineering, it clearly has a focus on medical research. So this overall reduction in capital spending masks an even more severe reduction for the non-medical sciences, which in turn signals the Government’s research priorities.

It should also be noted that, according to the Allocations, “the first year of that capital allocation is firm but the remaining years are indicative only at this stage” – so there may be further twists in this story further down the line.

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