You need cookies enabled

HEFCE closed at the end of March 2018. The information on this website is historical and is no longer maintained.

Many of HEFCE's functions will be continued by the Office for Students, the new regulator of higher education in England, and Research England, the new council within UK Research and Innovation.

The HEFCE domain - - will continue to function until September 2018. At this point we will close the site entirely and all its information will only be available from the National Web Archive.


You need cookies enabled

Universities have a strong interest in being associated with thriving locations, as well as making national and international contributions. They are key elements in the knowledge economy and in the global competitiveness of places.

The report [Note 1] by Tomas Coates Ulrichsen of Cambridge University [Note 2] uses data on knowledge exchange since 2003 [Note 3], as well as qualitative information submitted by universities to HEFCE [Note 4]. It describes turbulence in demand during the period of study, arising from the major economic downturn since 2008 and from changes to the public sector including the winding-down of the Regional Development Agencies (RDAs). The growth rate in income from university knowledge exchange has remained positive throughout [Note 5].

The report presents new analysis of the return on the public investment in knowledge exchange through Higher Education Innovation Funding (HEIF). For every £1 of HEFCE knowledge exchange funding over the period from 2003 to 2012, £6.30 has been earned in gross additional income, and the report acknowledges that the total benefits to the economy and society are likely to be greater. The analysis supports the conclusion of the Witty Review [Note 6] regarding the vital importance of HEFCE’s funding for knowledge exchange.

The report also shows a rebalancing of university efforts towards the private sector. Some universities have seized major opportunities to work with large businesses which are restructuring their research and development operations and seeking strategic innovation partners. Others are stepping into the gaps left by the abolition of the RDAs, and working with local economic development bodies to secure European Union or UK funding to provide innovation-related services to local and regional companies.

HEFCE intends to build on the analysis with further investigation of higher education’s role in growth, particularly in relation to small and medium-sized enterprises and anchoring in the local community, to explore the issues identified in the Witty Review.

Madeleine Atkins, HEFCE Chief Executive, said:

‘The anchor role of universities is critically important. All stakeholders now recognise that universities – their research, knowledge, expertise and talent – are the lynchpin for growing a modern, smart economy that benefits people around the country. I am committed to doing more to support this role, working with the enthusiasm and inventiveness of universities and colleges themselves.’

Tomas Coates Ulrichsen said:

‘What strikes me from the analysis is the dynamism within the sector. Far from being static entities, universities are exploring new ways of working with businesses, big and small, multinationals and local firms, with emphasis being placed on building longer-term relationships and more strategic partnerships. These partnerships also extend well beyond the private sector. Important relationships are being developed with local economic development partners such as Local Enterprise Partnerships, strengthening their role in supporting innovation and skills development in their local economies.’

Read the report


  1. ‘Knowledge exchange performance and the impact of HEIF in the English higher education sector’, April 2014
  2. Tomas Coates Ulrichsen is a Research Fellow at the Centre for Science, Technology and Innovation Policy at the University of Cambridge. He produced the report for HEFCE as an independent consultant.
  3. The Higher Education – Business and Community Interaction survey (2011-12 iteration at HEFCE 2013/11).
  4. The Annual Monitoring Statement to HEFCE (see ‘Annual accountability returns 2013’, HEFCE 2013/23.)
  5. Excluding RDA income.
  6. Sir Andrew Witty’s Review of Universities and Growth. The Government response to the Witty review was published in March 2014 and made a commitment to funding a long-term approach to knowledge exchange.