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  • Executive summary
  • Background
  • Next steps
  • Analysis
    • Strategy
    • Infrastructure
    • Research-based interactions and intellectual property
    • Social, community and cultural activities
    • Regeneration
    • Education and continuing professional development


  • Annex A   Full data by region and nation
  • Annex B   Questionnaire Part A (strategic/qualitative questions)
  • Annex C   Questionnaire Part B (numeric/financial questions)
  • Annex D   International comparisons, IP-related
  • Annex E   List of abbreviations
  • Annex F   HE-BCI stakeholders group
  • Annex G   List of respondents
  • Annex H   Full data by institution

Executive summary


1.   The Higher Education - Business and Community Interaction (HE-BCI) Survey is in its seventh year and is an essential source of information on knowledge exchange in the UK. The exchange of knowledge takes place between higher education institutions (HEIs) and the wider world of business and the community (although, of course, knowledge is also shared and transferred between academics and HEIs by nature of academia). Data reported here provide invaluable intelligence for knowledge exchange practitioners and policy-makers alike. The report also provides an in-depth commentary on the extent of and trends in knowledge exchange activity in the UK.

2.   This report builds on previously published HE-BCI surveys, the most recent of which analysed 2004-05 and 2005-06 data and was published in July 2007 (HEFCE 2007/17). In this latest survey, higher education institutions (HEIs) provided financial and output data for academic year 2006-07. The data reported under 'capacity' and 'infrastructure' are a snapshot of the position at 29 January 2007-08.

3.   HE-BCI covers a range of activities, from the commercialisation of new knowledge, through the delivery of professional training, consultancy and services, to activities intended to have direct social benefits. 'Business' in this context refers to public and private sector partners of all sizes and sectors, with which HEIs have a broad spectrum of interactions. 'Community' in this context is taken to mean society as a whole outside the HEI, including all social, civic and cultural organisations and individuals.

Key points

4.   The position of HEIs as drivers of the UK knowledge economy is becoming increasingly embedded, as shown by the most recent data made available here (from academic year 2006-07). HE-BCI collects data across a very broad range of indicators designed to address the many and various impacts made by the UK higher education (HE) sector on the economy and society. The total income represented in HE-BCI has increased from £2,267 million in 2005-06 to £2,641 million in 2006-07, an increase of 17 per cent (Figure 1). Spending on knowledge and services from HEIs is roughly equal between the commercial and non-commercial (both public and third sector) clients. In Figure 1, 'other' may include partnerships drawn from a variety of sectors, such as in collaborative research.

Figure 1 Total income by partner 2003-2007


Source: HE-BCI Part B Tables 1, 2, 3 and 4c

Figure 1, Total income by partner 2003-2007

5.   Income from collaborative research (defined in HE-BCI as where there is a third partner from business or the community together with a public funder engaged with the HEI) has risen by 12 per cent in the UK to nearly £670 million. Projects with Research Councils UK (from the Department for Innovation, Universities and Skills' Science Budget) as the public funder accounted for the greatest share and increase in collaborative research (although it is possible that moves to fund research on full economic cost (fEC) basis has affected this indicator1). Spending on contract research (a single partner approaching an HEI) has increased by 20 per cent with an associated increase of 12 per cent in the number of interactions. The largest part of this increase was non-commercial (for example, public and third sector) partners, accounting for over £446 million of the £783 million total. Combined, all research-related activities totalled over £1,450 million in 2006-07.

6.   The role of HEIs in the knowledge economy is, of course, broader than the creation of new knowledge. Consultancy, the innovative application of existing knowledge, rose by 19 per cent from £242 million in 2005-06 to £288 million in 2006-07. Again, the public sector accounted for the greatest part of this increase, though income from small and medium-sized enterprises (SMEs) rose by 18 per cent to nearly £47 million, representing over 20,000 interactions2. HEIs are also able to enhance their impact by opening access to equipment and facilities (ranging from supercomputers to performance space) for the benefit of business and the community. Income from such services rose by 3 per cent to nearly £93 million, with the majority of this increase coming from SMEs (who actually spend more on such services than large business, but still less than those in the public sector).

Figure 2 Income by activity and partner 2006-07


Source: HE-BCI Part B Tables 1b, 2 and 4c

Figure 2, Income by activity and partner 2006-07

7.   HEIs in the UK also provide a range of education provision beyond conventional teaching of under- and postgraduates. Many organisations, in the public and private sectors alike, approach HEIs to provide bespoke courses for their staff; others may make use of more standardised options for their continuing professional development (CPD). This indicator is difficult to define robustly, but data returned suggest UK HEIs provided over £485 million of CPD in 2006-07, an increase of 20 per cent from 2005-06.

8.   With their intellectual capital and connections to all levels of communities and regions, HEIs are well placed to engage in economic and social regeneration, through programmes funded by regional and national development agencies in the UK and other European programmes such as the European Regional Development Fund (ERDF) and the European Social Fund. Income from regeneration programmes rose by 14 per cent to just over £265 million in 2006-07.

9.   One important proxy for economic impact is data related to the commercialisation of intellectual property (IP) where HEIs' knowledge is transferred to another organisation and assumed to have a direct impact on the outside world. Overall, UK income from IP rose by less than 1 per cent, meaning there was a slight drop in real terms (as displayed in the time-series graph adjusted for inflation). The picture across the UK is complex with no clear trends.

10.   There was a 22 per cent increase in the resources invested in protection of IP (through patents, for example) reaching over £20 million. The number of invention disclosures (often the first formal step toward protecting an invention) increased by 11 per cent to nearly 3,800. Patent applications and new patents granted both increased from 2005-06 to 2006-07, by 25 per cent and 12 per cent respectively.

Figure 3 Selected HE-BCI income streams 2003-2007 (real terms)


Source: HE-BCI 2003-2007 Part B Tables 1b, 2, 3 and 4c

Figure 3, Selected HE-BCI income streams 2003-2007 (real terms)

11.   A spin-off company is an enterprise exploiting IP owned by the HEI (start-ups are similar new companies but not based on HEI IP), but these companies often take some time to reach profitability, so data are also collected on the survival rate of firms. In 2006-07, 226 companies were formed on the basis of IP generated by UK HEIs and there were over 1,200 HE spin-off companies active, an increase of 7 per cent from 2005-06.

12.   While many of the outputs and much of the income reflect on formal exploitation of an HEI's assets, it is also apparent that HEIs are central to their communities and regions and are 'porous' by their very nature. Nearly 650,000 members of the public attended free lectures at HEIs in 2006-07, an increase of 20 per cent from data reported in 2005-06. A smaller number of people (around 110,000) attended lectures where entry was not free of charge. However, where HEIs also offer performance and exhibition events, the balance of attendees pay for admission (although it is not considered practical to collect this income data as it is often marginal) with data suggesting over 1.4 million people attended such events at HEIs in 2006-07.

13.   Outputs from and income to HEIs cannot tell the whole story of the actual interactions and the HE-BCI survey also gives insights into infrastructure developments that may have longer-term pay-offs in new areas of activity, such as work with SMEs. The survey demonstrates that improvements have been made to respond to such new challenges; for example, HEIs, with public support, have invested in infrastructure (such as specialised advisers, web resources, customised offers and support) to enable them to respond more effectively to SMEs. Over 90 per cent of HEIs provide an enquiry point for SMEs with a similar number offering bespoke education courses, on and off campus. Around 75 per cent of HEIs have a central system to support academics in the specialist administrative processes that are needed in work with SMEs unfamiliar with working with HEIs.

Figure 4 Selected infrastructure indicators 2000-2008


Source: HE-BCI Part A Questions 11 and 29 (data for 2002-03 and 2003-04 are assumed - see paragraph 19)

Figure 4, Selected infrastructure indicators 2000-2008

Action required

14.   This report is for information. No action is required.


  1. For further detail on fEC see
  2. Some consultancy is delivered through other funding processes such as EU-funded regeneration projects - see 'Regeneration' section of this document.

Date: 1 July 2008

Ref: 2008/22

To: Heads of HEFCE-funded higher education institutions

Of interest to those
responsible for:

Links with business and the community, Research, Continuing vocational education, Workforce development, Funding, Planning

Enquiries should be directed to:

Adrian Day, tel 0117 9317428, e-mail