Dear Vice-Chancellor or Principal
Higher education’s contribution to economic growth: Invitation to submit expressions of interest for funding through the Catalyst Fund
1. This letter invites expressions of interest for funding for projects that will enhance higher education’s (HE’s) contribution to economic growth. The deadline for expressions of interest is noon on Thursday 24 January 2013. Expressions of interest must be submitted using the template at Annex A. Projects should start ideally by the beginning of the 2013-14 academic year, and by December 2013 at the latest.
2. Funding of up to £50 million for such projects is available from our Catalyst Fund. Successful expressions of interest that are subsequently worked up into full proposals will need to be approved through the usual processes of the fund.
3. Through this funding we are seeking to support developments that stimulate the capabilities of HE teaching and research to deliver sustainable economic impact across the nation. We will consider activities that are focused on short-term growth initiatives, but proposals should demonstrate an expectation of long-term sustainability at the outset. Our three areas of interest in this call for proposals are:
- enhancing the economic anchor role of universities and colleges within their localities
- stimulating employability, entrepreneurship and work-readiness at undergraduate, postgraduate and post-doctoral level
- supporting innovation-led growth in key sectors.
Purpose of the funding
4. We launched the new Catalyst Fund in August 2012. This replaced the Strategic Development Fund as the route for discretionary investment to support our objectives. In announcing the new fund, we stated that catalyst funding would be used most effectively by universities and colleges in collaboration and partnership with employers, with each other, and with other funding bodies or key partners, and that matched funding or co-investment would likely be a key feature of successful proposals. We also highlighted our interest in supporting activities that could stimulate and sustain economic growth.
5. We are keen to ensure that HEFCE’s activities encourage universities and colleges to support economic growth, and to embed approaches to delivering long-term economic impact. While this priority is supported through our recurrent funding, regulation and information provision, the Catalyst Fund provides a potential route for shorter-term funding to stimulate new activities which will generate a return on the investment in terms of benefits for the economy. We wish to draw on the fund to make focused investments to support economic growth, in a manner consistent with the Government’s broader plans for growth.
6. The Catalyst Fund will continue to operate as usual during the process outlined in this letter, supporting other proposals relating to economic growth and its other policy themes. We may advise institutions with highly attractive proposals that do not fit with the immediate aims of this call to develop their proposals as part of usual Catalyst Fund business.
How funding might be spent
7. Funding is available for proposals focused on three themes:
- Enhancing the economic anchor role of universities and colleges, securing investment and talent for their localities, and positioning them within local economic growth plans, including through their engagement in teaching and research activities overseas and inward investment initiatives.
- Delivering effective teaching, research and entrepreneurship for innovation-led growth in the key sectors where the Government is developing partnerships and strategies with business.
- Enabling students at all levels and early-career researchers to contribute directly to business through enterprise, employability and work-readiness activities – both for their own career development and to enhance the productivity and innovation of businesses, particularly small and medium enterprises with limited experience of graduate talent and enterprise.
8. Projects must be consistent with the main policies and principles of the Catalyst Fund. These include consistency with the competitive aspirations at the heart of the Government’s student finance reforms, and with the selective, performance-based principles underpinning our research and knowledge exchange funding. This means we do not expect to fund activities that could be supported from core research, from knowledge exchange, or from tuition fees and teaching grant.
9. Where this fund can make a difference in these areas is in securing a step change in activity, such as the time spent on partnership arrangements and the costs incurred by the university and partners, and additional costs incurred by students. We expect financing to be in place for the individual student’s study or work time through fees and salary, but we would be prepared to consider matching industry financing for a fixed period, with the expectation that the HEFCE contribution will diminish over time and the activity will become sustainable through industry financing at the end of the project period. Hence we do not generally expect to fund internships or work placements, or individual students and researchers, but would consider funding development activities to deliver significant change and investment from the private sector. The key is that proposals can demonstrate clear demand and investment from private sector employers, and an emphasis on sustainability.
10. Within the three broad areas identified in paragraph 7, we wish to encourage innovative ideas that can deliver a novel approach or step change in activity and whose good practices or lessons learnt may be more widely transferable. We expect universities and colleges to work with employers to demonstrate a clear, tangible impact on private sector business. Proposals should provide evidence that they will secure significant co-investment or matched funding from partners, appropriate to the benefits that these partners will receive from the project. Proposals must demonstrate long-term impact and viability in terms of the strategic fit with institutional objectives: we are not looking to fund initiatives that will have only short-term impacts with no longer-term sustainability.
11. In developing HEFCE’s approach to support for growth, we will take into account significant government policies on economic growth and recovery. This includes the Government’s Plan for Growth, the Innovation and Research Strategy, the Industrial Strategy and the work of other key funders such as the Technology Strategy Board. We look forward to gaining evidence from the proposals submitted to us of business demand and impact on the ground, and the ways in which institutions are responding to these. We will therefore analyse proposals to feed into the Council’s contribution to the further development of the Government’s Industrial Strategy.
Funding and eligibility
12. We will provide up to £50 million through the Catalyst Fund to support HE’s contribution to economic growth. We expect individual proposals of up to £8 million, with a minimum level of funding of £100,000. We expect a wide range of proposals in terms of ideas and funding, reflecting local needs as well as national priorities.
13. Funding is available to higher education institutions (HEIs) and further education colleges (FECs) which are directly funded by HEFCE. Individual HEIs and directly funded FECs can be involved in up to two proposals. This flexibility is to provide opportunity for institutions to address different priorities, to allow for collaborative activity, and to encourage innovative, higher-impact activity.
14. Due to the legal restrictions on our funding responsibilities for directly funded FECs, we can only consider proposals from them where:
- Economic growth activity is directly linked to the development and delivery of prescribed courses of HE. We are unable to provide funding to support infrastructure or other developments more generally.
- The investment is proportionate to the scale of HE provision directly funded by HEFCE.
15. To maximise available funding and the opportunities open to them, FECs may wish to consider collaborative proposals. Indirectly funded FECs can be partners in proposals led by an HEI or a directly funded FEC.
16. The funding is not generally available for capital projects or capital elements within projects, but we will consider this if there is a particularly strong case.
17. Expressions of interest will be considered against the following criteria:
- Alignment with the three themes of the funding set out in paragraph 7.
- Evidence of potential commitment from partners, particularly private sector businesses, in the form of new funding or significant support in kind. Any contributions in kind should be qualified with a full explanation as to how the value has been determined.
- Extent to which the proposal has demonstrated the level and nature of the anticipated impact on economic growth, and justified the reasons for this assessment.
- Value for money, including likely sustainability.
18. In its approach to economic growth HEFCE is working closely in partnership with other funders, particularly the Technology Strategy Board. The Technology Strategy Board will be involved in the assessment of proposals relevant to its remit. We would be interested in proposals that meet joint HEFCE-Technology Strategy Board objectives. These might include:
- Collaborative arrangements that enable deeper engagement between institutions and business, and promote activities that align with the Technology Strategy Board’s national priorities.
- Innovative approaches for collaborations between institutions to work within the aims and objectives of Technology Strategy Board Catapult Centres.
- Innovative approaches that align institutional innovation voucher schemes with the Technology Strategy Board’s national programme.
Application process, selection and timescale
19. Expressions of interest should be submitted by e-mail to firstname.lastname@example.org by noon on Thursday 24 January 2013, using the template at Annex A. Expressions of interest will then be assessed and an external panel will review the outcomes. The panel will have representation from members of our Catalyst Fund panel and the Technology Strategy Board.
20. Successful expressions of interest will then need to be developed into full proposals and will go through the usual Catalyst Fund process before any HEFCE funding is confirmed. Full proposals will be considered against the criteria, policies and principles of the fund.
21. The Catalyst Fund will continue to operate during this process, supporting other proposals relating to economic growth and its other policy themes.
22. The approximate timetable is set out below.
24 January 2013
Deadline for expressions of interest.
To mid February
Assessment of expressions of interest.
Late February 2013
External panel meeting to review recommendations. Institutions informed of decisions.
From early March 2013
Development of successful expressions of interest into full proposals.
Approved projects underway by end December at the latest.
23. Successful projects will be subject to individual monitoring arrangements depending on specific factors such as the scale of investment and level of risk involved. Monitoring arrangements will be agreed for individual projects and set out in the award letter. This is in line with the policies of the Catalyst Fund.
Freedom of Information Act 2000
24. HEFCE is subject to the Freedom of Information Act 2000 which gives a public right of access to information held by a public authority. This may mean that applications, communications between us and institutions, information arising from the work undertaken or its outputs become subject to disclosure if a valid request is made to us. We will comply with such requests in accordance with the legislation and our own policies.
25. Institutions can, if they wish, provide potentially sensitive information (such as information relating to commercial interests) in a separate annex attached to the application form. This will highlight to us that there are concerns over disclosure. With annexes, the proposal must not exceed the maximum length as stated in the application template. Where we consider it to be appropriate and practicable we will seek the views of applicants before disclosing this information. The applicant acknowledges that information provided in the annex is of indicative value only and that HEFCE may nevertheless be obliged to disclose this information. Our assumption will be that all information in the main application documents can be disclosed on request.
26. Further information about the Freedom of Information Act can be found on the Information Commissioner’s web-site.
27. If you have queries please contact your HEFCE institutional team.
Sir Alan Langlands