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  • Executive summary
  • Background
    • England
    • Wales
    • Scotland
    • Northern Ireland
  • Next steps
  • Analysis
    • Strategy and infrastructure
    • Research-based interactions and intellectual property
    • Social, community and cultural activities
    • Regeneration
    • Education and continuing professional development
  • Annex A Summary data part B
  • Annex B International comparisons, IP-related
  • Annex C List of abbreviations

Executive summary


1. The Higher Education – Business and Community Interaction (HE-BCI) Survey is in its ninth year and is an essential source of information on knowledge exchange in the UK.

2. The exchange of knowledge described here takes place between higher education institutions (HEIs) and the wider world of business and the community.

3. Data reported here provide valuable 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.

4. This report builds on previously published HE-BCI surveys, the most recent of which analysed 2007-08 data and was published in July 2009 (HEFCE 2009/23)See note 1.

5. In this latest survey, the first to be carried out by the Higher Education Statistics Agency (HESA) as part of the formal Finance Statistics Return, HEIs provided financial and output data for academic year 2008-09. Data regarding strategy and infrastructure (which are not numeric or financial) were available for 2009-10, given they are in place for the start of the following academic year and therefore provide a more up-to-date picture.

6. 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 private, public and third-sectorSee note 2 partners of all sizes and sectors, with which HEIs interact in a broad range of ways. 'Community' in this context is taken to mean society as a whole outside the HEI, including all social, community and cultural organisations, individuals and the wider public.

Key points

7. Data collected for academic year 2008-09 show an increase in the overall exchange of knowledge between UK HEIs and the public, private and third sectors despite the change and uncertainly in the economy recently. The growth rate – in cash terms – for the UK is around 5.5 per cent, from £2,812 million in 2007-08 to £2,966 million in 2008-09.

Economic context

8. We highlighted in the HE-BCI Survey 2007-08 (HEFCE 2009/23) that results needed to be seen in the context of wider economic conditions that may impact on HEIs' interactions with their partners. We noted then that UK Gross Domestic Product (GDP) growth had been flat for the last quarter of that reporting year. This change in economic conditions was likely then to have affected the rate of growth in HE-BCI indicators (growth in total income in that year was 6.5 per cent in cash terms).

9. For this survey, GDP fell by 2 per cent. Hence this year's HE-BCI growth of around 5.5 per cent in HEIs' total income demonstrates impressive performance in difficult conditions, and may suggest that they have been successful in deploying their knowledge and expertise effectively to respond flexibly to challenges and opportunities presentedSee note 3.

10. Figures for UK nations show notable variation and reflect the different economic contexts (and HE funding polices) of England, Wales, Northern Ireland and Scotland.

Change in data collection

11. It should also be noted that the process for data collection has been undertaken by HESA for the first time this year and the organisational change has, as expected, led to some anomalies. However, it is agreed that the data are useful and informative as presented in this reportSee note 4.

Income by partner

12. Commercial partners spent less overall in 2008-09 than in the previous year, as may be expected given the recession; public sector clients have increased levels of engagement (see Figure 1). However, 'individuals' and 'other' partner categories both represent activity that could be of benefit to either or both public and private sectors (although concern for reasonable burden of collection prevents these being further disaggregated).

Figure 1 Total income by partner 2003-2009 (real terms)

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

Income by activity

13.   Collaborative research income has risen by 5 per cent from around £700 million to £732 million (see Figures 2 and 3). However, substantial changes had been made to the format of this survey question so as to disaggregate public, private and in-kind contributions for the first time (see paragraph 84 for further information).

14.   Contract research income has also risen by 12 per cent from £835 million to £937 million. This increase is common across partners although the majority of this rise is from non-commercial partners.

Figure 2 Selected HE-BCI income streams 2003-2009 (real terms)
Figure 2 Selected HE-BCI income streams 2003-2009 (real terms)

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

Figure 3 Income by activity and partner 2008-09
Figure 3 Income by activity and partner 2008-09

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

15.   In 2008-09 consultancy income fell by around 1 per cent to £332 million from £335 million in 2007-08. However, in this case, commercial activity has reduced slightly with non-commercial clients' spending almost making up for it – a trend that may reverse as the economy recovers.

16.   Income from use of facilities and equipment (for example particle accelerators or digital media suites) rose by around 7 per cent overall to £110 million; in this category, only income from small and medium-sized enterprises (SMEs) fell – by around 1 per cent, although the number of interactions increased.

17.   Income from continuing professional development and Continuing Education (CE) activity rose by around 4 per cent from £537 million in 2007-08 to £559 million in 2008-09 although, again, the increase was mainly from non-commercial and other partners. The SME and other commercial business groups spent around 9 per cent and 14 per cent less respectively. However, income from individuals rose by around 15 per cent, perhaps reflecting increased (re)training opted for during difficult employment periods. The total learner days delivered to all clients rose by 21 per cent to nearly 4 million during 2008-09.

18.   Income from regeneration programmes has fallen from around £238 million in 2007-08 to £172 million in 2008-09. This fall is mostly accounted for by UK HEIs being awarded less from the European Community Structural Funds programmes (the European Social Fund and European Regional Development Fund) following the inclusion of accession states in the EU. UK central government funding for regeneration actually increased slightly, although Regional Development Agency funding – a larger proportion of the total – dropped.

19.   Exploitation of intellectual property (IP) continues an upward trend in terms of both income and numbers of interactions:

  1. Disclosures, patent applications and new patents granted have all increased, leading to a modest 2 per cent increase in the cumulative patent portfolio of the UK HE sector. Total licence numbers, both software and non-software, have increased considerably; in fact it is likely that the change in reporting practice (via HESA) has provided more complete data in this area. SMEs, commercial business and non-commercial clients all increased the number of licences taken to use IP generated in UK HEIs.
  2. Income from IP (excluding sale of shares in spin-offs) has also increased – by 24 per cent – from £45 million in 2007-08 to £56 million in 2008-09.
  3. Spending on the protection of IP also rose by over 30 per cent from £21 million to £28 million.
  4. Particularly impressive is income from the sale of shares in spin-off companies, moving from £66 million in 2007-08 to £124 million in 2008-09, an increase of 188 per cent. Much of this increase is due to one HEI's sale of a long-established company, but this should not detract from the point that HEI spin-off companies can have a significant impact on the economy; indeed, income from sale of equity is likely to fluctuate, given that this area of activity may be characterised by long timescales and small numbers of large sales.
  5. Numbers of new spin-offsSee note 5 (companies based on HEI-generated IP) fell from 221 in 2007-08 to 191 in 2008-09. This indicator has been volatile over the last decade, because it tends to reflect the end-point of research that may have been conducted 10 to 20 years previously whereas the actual flotation will be affected by the immediate economic environment, such as the availability of seed funding.
  6. A more useful indicator is the number of companies that have survived three or more years: 2008-09 data show 982 such spin-offs, an increase of 12 per cent since 2007-08.

20.   New enterprises (start-ups) that are not based on IP have increased since 2007-08 with 53 new companies started by HEI staff and 2,031 by new or recent graduates, up 29 per cent and 4 per cent respectively in 2008-09. Start-ups active for three or more years also increased in 2008-09, by 6 per cent and 26 per cent for staff and recent graduates respectively.

21.   HE-BCI also collects data on public events run by HEIs. These illustrate the wide-ranging civic, community and cultural contributions that HEIs make, though they describe only a small part of that range. Over 750,000 people attended free public lectures in 2008-09; representing little change from 2007-08. For performance events (for example music, dance and drama) more people pay to attend events (over 1.6 million attendees) than attend free performances (440,000). Free exhibitions attracted nearly 6 million visitors and almost 750,000 paid to attend exhibitions.

Strategy and infrastructure

22.   Some data regarding infrastructure in HEIs seem to show a decline in some provisions of services, such as enquiry points for SMEs (see Figure 4). This may reflect the present economic context or may be due to changes in process and definitions. Further data will be required to confirm this question although it should be noted that provision is still significantly higher than the start of the decade.

Figure 4 Selected strategy and infrastructure indicators 2000-2010
Figure 4 Selected strategy and infrastructure indicators 2000-2010

Source: HE-BCI Part A Questions 11 and 29 (data for 2002-03 and 2003-04 are assumed – see paragraph 31)

Action required

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

Date: 1 June 2010

Ref: HEFCE 2010/14

Of interest to those
responsible for:

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

Enquiries should be directed to:

Adrian Day, tel 0117 931 7428, e-mail