You need cookies enabled


You need cookies enabled

Executive summary


1. The Higher Education – Business and Community Interaction (HE-BCI) Survey is in its tenth year and is an essential source of information on knowledge exchange (KE) 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 in this survey provide valuable intelligence for higher education (HE) senior managers, knowledge exchange practitioners and policy makers. 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 2008-09 data and was published in June 2010 ('Higher Education - Business and Community Interaction Survey: 2008-09', HEFCE 2010/14)see note 1.

5. In this latest survey, the second to be carried out by the Higher Education Statistics Agency (HESA) as part of the formal Finance Statistics Record, HEIs provided data for academic year 2009-10. Data regarding strategy and infrastructure (which are not numeric or financial) will be for the end of the academic year (July 2010).

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 means 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 2009-10 show a continuing increase in the overall exchange of knowledge between UK HEIs and the public, private and third sectors. The growth rate – in cash terms – for the UK is around 4 per cent, from £2,966 million in 2008-09 to £3,086 million in 2009-10.

8. Income in real terms for the main HE-BCI indicators has risen by 35 per cent since 2003-04 from around £2,200 million to £3,086 million (with only regeneration funding showing a decrease due, in part, to the expansion of the European Community).

9. Data are likely to be affected by recent economic trends. The Government's programme of public sector restructuring (including changes to the HE sector) is also likely to have an effect in future surveys. Further data will be needed to understand the effect of these changes on knowledge exchange activity, for example, the difference in time lag between restructuring in the public sector as opposed to private business, where the latter is generally considered to happen more swiftly.

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

11. International comparisons of KE activities are still very difficult to draw with any degree of certainly given the multitude of factors that must be accounted for. HE-BCI includes comparisons with US universities based on data collected by the Association of University Technology Managers on commercialisation of IP. Overall, US universities are more effective at producing licences than UK HEIs, but the UK creates more spin-off companies. Further detail is at Annex B.

Income by partner

12. Spending by large business fell overall, while small and medium-sized enterprises (SMEs) increased their total spending on engagement with UK HEIs; although, as in the previous survey, the most significant increases have been with non-commercial partners such as those in the public and third sectors, charities and social enterprises etc (see Figure 1).

13. For some indicators, income is not disaggregated to partner categories in order to keep the burden of collection reasonablesee note 3. Hence, the 'individuals' and 'not elsewhere classified' partner categories both represent activity that could be of benefit to either or both public and private sectors. In particular, the sale of shares in spin-off companies, and a large proportion of collaborative research, are likely to be dominated by commercial business, but these are not further disaggregated so are reflected in the 'not elsewhere classified' category.

Figure 1 Total income by partner 2003-2010 (real terms)

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

Income by activity

14.   There have been some signs of economic recovery since the last report was produced but the effects of the recession are still being felt and there are, perhaps, fewer clear trends than described in previous reports. This does not mean that the data suggest an overall fall in KE activity – quite the contrary in places.

Research-based interactions

15.   Collaborative research income rose by just over 2 per cent from around £732 million to £749 million (see Figures 2 and 3). However, substantial changes had been made to the format of this survey question in 2008-09 so as to disaggregate public, private and in-kind contributions, and HEIs report that they are still making improvements to the way data are captured for this indicator so some caution is required for this year.

16.   The data reported show a slight decrease (around 1.7 per cent from £612 million to around £602 million) in the public contribution to collaborative research as defined in HE-BCI, although this remains the largest share. There was a significant increase in private contributions, both cash and in-kind, although it is likely this also includes improvements in data capture.

17.   Contract research income has risen by 5 per cent from £937 million to £983 million. The main increase in income was from non-commercial partners (11.1 per cent) although income from SMEs also rose by 1.7 per cent. There was a 5 per cent decrease in income from large business, which may be expected due to the recession.

Figure 2 Selected HE-BCI income streams 2003-2010 (real terms)

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

Figure 3 Income by activity and partner 2009-10

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


18.   In 2009-10, consultancy income increased by over 9 per cent to £362 million, from £332 million in 2008-09. As with contract research, the majority of this increase is due to non-commercial partners (16.7 per cent) although SME income also rose slightly (0.2 per cent).

Equipment and facilities

19.   Income from use of facilities and equipment (for example, particle accelerators or digital media suites) rose by around 4 per cent overall to £115 million; the majority of this increase was from SMEs, which invested over £36 million in 2009-10, 12.3 per cent more than in 2008-09. However, the large increase in the number of interactions with SMEs suggests that changes in reporting practice by a handful of HEIs may also have contributed, as well as possibly the additional support given from public sources in the recession.

20.   Income from non-commercial partners fell by 0.9 per cent showing that the equipment services category does not follow the same trend as contract research and consultancy.

Education and continuing professional development

21.   Continuing professional development (CPD) income has grown by 69 per cent since 2003-04, a testament to the fact that society no longer sees HEIs as organisations that are relevant only between school and the workplace.

22.   Income from CPD and Continuing Education activity rose by around 4 per cent from £559 million in 2008-09 to £580 million in 2009-10. The majority of the increase was from non-commercial partners (over £27 million, 11.3 per cent) although income from SMEs rose by a higher proportion (13.3 per cent, from £25.5 million to nearly £29 million). Income from large business fell by around £6.5 million (-5.8 per cent) and income from individuals fell by over £3 million (-1.9 per cent).

23.   The total learner days delivered to all clients fell by 8 per cent from nearly 4 million during 2008-09 to around 3.7 million in 2009-10.


24.   Income from regeneration programmes rose overall for the first time in a number of years, from £172 million in 2008-09 to over £213 million in 2009-10, an increase of 23.7 per cent.

25.   The largest increase in absolute terms was from Regional Development Agency (RDA) programmes which increased by 24 per cent to £93 million (although this income is, of course, likely to reduce following the wind-down of the RDAs in England). There were higher proportion increases across other indicators but also reductions suggesting no clear trend up to the present.

Intellectual property and enterprise

26.   Income from intellectual property grew by 88 per cent over the period 2003-04 to 2009-10, soundly challenging the historic assumption that the UK is not improving at turning its world-class research into social and economic benefits for the nation.

27.   Exploitation of intellectual property (IP) has generally increased since 2008-09:

  1. Disclosures and new patents granted have increased by 2.3 per cent and 26.6 per cent respectively. Although there was a slight drop in the number of new patent applications (down 4.1 per cent from 2008-09 to 2009-10), patent data should always be viewed over a longer time series because of the time lag between applications and grants. The cumulative patent portfolio of the UK HE sector increased by 3.7 per cent from 14,276 to 14,800.
  2. Total licence numbers increased overall, although this includes a slight drop in the number of software licences; SMEs, commercial business and non-commercial clients all increased the number of non-software licences taken to use IP generated in UK HEIs.
  3. Income from IP (excluding sale of shares in spin-offs) has also increased – by 2.4 per cent – from £56 million in 2008-09 to nearly £58 million in 2009-10.
  4. Spending on the protection of IP also rose by nearly 6 per cent from £28 million to over £29 million.
  5. Numbers of new spin-offssee note 4 (companies based on HEI-generated IP) rose substantially from 191 in 2008-09 to 273 in 2009-10. 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 stable indicator of the success of new IP-based enterprises is the number of companies that have survived three or more years. However, this indicator has dropped for the first time due to the impact of the recession, with 969 three year-old or older companies reported (a drop of 1 per cent from 982). However, the total number of active firms has increased by 1 per cent to 1,340.

28.   New enterprises (start-ups) that are not based on IP have increased since 2008-09, with 65 new companies started by HEI staff and 2,357 by new or recent graduates, up 23 per cent and 12 per cent respectively in 2009-10. Start-ups active for three or more years also increased in 2009-10, by 12 per cent and 15 per cent for staff and recent graduates respectively.

Social, community and cultural activities

29.   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.

30.   Over 984,000 people attended free public lectures in 2009-10, representing a 31 per cent increase from 2008-09.

31.   For performance events (for example music, dance and drama) more people pay to attend events (over 1.7 million attendees) than attend free performances (around 1 million). Free exhibitions attracted over 7 million visitors and almost 780,000 paid to attend exhibitions in 2009-10.

Strategy and infrastructure

32.   Looking at performance to date, there are clear signs that the UK HE sector is adept at responding to demand by improving infrastructure and increasing its output. If spending is assumed as a proxy for impact, this suggests that HE is making a very significant contribution to the modern knowledge economy.

33.   Following a slight dip last year, selected infrastructure indicators have recovered to above their 2008-09 levels. Further data will be required to confirm this, although it should be noted that provision is still significantly higher than the early HE-BCI surveys. It is likely that there will be further movement around these indicators, given national and sub-national changes to policy and funding such as the wind-down of RDAs and changes to HE arrangements.

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 43).

Action required

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


  1. All HEFCE publications may be read on the HEFCE web-site.
  2. The 'third sector' refers to voluntary and community groups, social enterprises, charities, co-operatives and mutuals.
  3. Collaborative research, CPD and sale of shares in spin-offs are not collected by partner as for the other main indicators, for reasons of administrative burden. It is safe to assume that much of this income will be from large business, however.
  4. This figure includes companies in which the HEI maintains a stake and those sold outright. 

Date: 1 September 2011

Ref: HEFCE 2011/25

To: Heads of HEFCE-funded higher education institutions

Of interest to those
responsible for:

Knowledge exchange; Innovation; Enterprise and entrepreneurship; Interactions between higher education and business, public and third sectors; Contract and collaborative research; Continuing professional development; Workforce development; Public engagement; Strategic planning; Economic development

Enquiries should be directed to:

Adrian Day, tel 0117 931 7428, e-mail