You need cookies enabled

Cookies

You need cookies enabled

Executive summary

Purpose

1. The Higher Education – Business and Community Interaction (HE‑BCI) survey is in its 15th year and is an essential source of information on knowledge exchange (KE) in the UK. It focuses on specific interactions with external partners, such as contract and collaborative research, consultancy, continuing professional development and intellectual property, rather than attempting to assess the entire contribution of higher education institutions (HEIs) throughout their teaching and research activities.

2. The exchange of knowledge described here takes place between higher education institutions and the wider world of business and the community. All 161 publicly funded UK HEIs provided data for this report1.

3. Data reported in this survey provides valuable intelligence for higher education senior managers, KE practitioners and policymakers. The report also provides an in-depth commentary on the extent of, and trends in, KE activity in UK HEIs. Overall, patterns are similar in each of the four constituent nations, although some data is displayed at the national level in the main report where recommended by the Stakeholders Group (see paragraph 19).

4. This report builds on data published in previous HE‑BCI survey reports, the most recent of which, ‘Higher Education – Business and Community Interaction Survey: 2013-14’ (HEFCE 2015/13), was published in July 2015 and analysed 2013-14 data2.

5. The data is collected by the Higher Education Statistics Agency (HESA). HEIs provided data for activity occurring during the academic year 2014-15. Data on strategy and infrastructure, being neither numerical nor financial, relates to the end of the academic year (July 2015). The HE‑BCI survey covers a range of activities from commercialisation of new knowledge, through delivery of professional training, consultancy and services, to activities intended to have direct social benefits. ‘Business’ in this context may refer to private, public, and third-sector partners of all sizes, with which HEIs interact in a broad range of ways3. ‘Community’ in this context means society as a whole outside HEIs, including all social, community and cultural organisations, individuals, and the public, both national and international.

Key points

6. Data collected for the academic year 2014-15 shows a continuing increase in the exchange of knowledge between UK HEIs and the public, private, and third sectors. The main indicators are summarised in Table 1. Annex A contains a summary of the full dataset for the UK and separate subsets for England, Scotland, Wales, and Northern Ireland.

Table 1: Main indicators (£000s cash terms)

£000s (cash terms)

2013-14

2014-15

Change

% Change

1a Collaborative research

1,143,804

1,257,033

113,229

9.9%

 

1b Contract research

       

Total value with SMEs (£000s)

45,120

47,985

2,865

6.3%

Total value with large businesses (£000s)

418,202

435,257

17,055

4.1%

Total value with public and third-sector organisations (£000s)

729,084

726,539

-2,545

-0.3%

Total value of contracts (£000s)

1,192,406

1,209,781

17,375

1.5%

 

2a Consultancy

       

Total value with SMEs (£000s)

74,272

73,686

-586

-0.8%

Total value with large businesses (£000s)

109,166

109,541

375

0.3%

Total value with public and third-sector organisations (£000s)

257,990

259,202

1,212

0.5%

Total income (£000s)

441,428

442,429

1,001

0.2%

 

2b Facilities and equipment related services

       

Total value with SMEs (£000s)

51,490

59,134

7,644

14.8%

Total value with large businesses (£000s)

47,946

61,862

13,916

29.0%

Total value with public and third-sector organisations (£000s)

63,490

70,484

6,994

11.0%

Total income (£000s)

162,926

191,480

28,554

17.5%

 

2c CPD

       

CPD for SMEs (£000s)

19,707

22,249

2,542

12.9%

CPD for large businesses (£000s)

130,825

136,873

6,048

4.6%

CPD for other public and third-sector organisations (£000s)

275,179

284,033

8,854

3.2%

CE and CPD for individuals (£000s)

252,708

271,761

19,053

7.5%

Total revenue (£000s)

678,419

714,916

36,497

5.4%

 

3a Regeneration and development programmes

180,606

204,558

23,952

13.3%

 

4c Intellectual property income

       

SMEs

10,466

13,751

3,285

31.4%

Large Businesses

62,786

75,771

12,985

20.7%

Public and third sector organisations

8,806

13,109

4,303

48.9%

Sub-total (£000s)

82,058

102,631

20,573

25.1%

Sale of shares in spin-offs (£000s)*

49,059

52,770

3,711

7.6%

Total revenues (£000s)

131,117

155,401

24,284

18.5%

         

Grand Total

3,930,706

4,175,598

244,892

6.2%

* Denotes data not disaggregated by partner.

Note: ‘SMEs’ = ‘small and medium-sized enterprises’; ‘CPD’ = ‘continuing professional development’; ‘CE’ = ‘continuing education’.

7. At a time of growth in the economy following a prolonged period of economic difficulty, growth in knowledge exchange income and activity provides an excellent case for continued public investment in higher education and specifically in knowledge exchange funding streams. Annual gross domestic product (GDP) growth for the UK in 2015 was estimated to be 2.2 per cent4. At 6.2 per cent, HE-BCI growth remained greater than overall UK GDP growth of approximately 2.2 per cent.

Investment in knowledge exchange by partner

8. Total KE investment across all activities from large businesses increased in cash (nominal) terms by 6.6 per cent, from £769 million in the previous year to £819 million, while small and medium-sized enterprises (SMEs) increased their overall spending by 7.8 per cent, from £201 million to £217 million. This is a smaller increase than last year, but continues the recovery from 2012-13. Income to HEIs from the public and third sectors increased by 1.4 per cent from £1,335 million to £1,353 million in 2014-15. Figure 1 shows how income from different types of partners has changed over time.

Figure 1: Total income by partner type, 2003-04 to 2014-15 (real terms 2015 prices)

Figure 1 

Source: HE‑BCI Part B Tables 1, 2, 3 and 4c. Note: Other refers to indicators which are not collected by partner type due to consideration of burden – see paragraph 30.

Collaborative research

9. Total income from collaborative research increased by 9.9 per cent during 2014‑15, from £1,144 million to £1,257 million. Improvements in data recording during a stable funding environment may have contributed to this growth. Figure 2 shows selected income streams from 2003-04 to 2014-15.

Figure 2: Selected HE-BCI income streams, 2003-04 to 2014-15 (real terms)

 

Note: ‘CPD’ = ‘continuing professional development’; ‘CE’ = ‘continuing education’; ‘IP’ = ‘intellectual property’. Source: HE‑BCI Part B Tables 1, 2, 3 and 4c.

Contract research

10. Contract research income increased by 1.5 per cent, from £1,192 million to £1,210 million. Large businesses and SMEs increased their investment in contract research by 4.1 per cent and 6.3 per cent respectively, representing an increase in income of nearly £20 million it total, which is less than the equivalent increase recorded last year. Income from non-commercial partners saw a small fall of 0.3 per cent, reaching £727 million in 2014-15. Figure 3 shows income by activity and partner in 2014-15.

Consultancy

11. Income from consultancy saw a small increase from £441 million to £442 million in 2014-15; work for large businesses saw an increase of 0.3 per cent while SMEs decreased by 0.8 per cent. Consultancy spending from the public and third-sector partners increased by 0.5 per cent and still accounts for the majority of activity at £259 million (whereas SMEs and large businesses spent around £74 million and £110 million respectively in 2014-15).

Figure 3a: SME income by activity, 2003-04 to 2014-15

Figure 3a 

Figure 3b: Large business income by activity, 2003-04 to 2014-15

Figure 3b 

Figure 3c: Public and non-commercial income by activity, 2003-04 to 2014-15

Figure 3c 

Figure 3d: Income by partners 2014-15

Figure 3d 

Note: ‘CPD’ = ‘continuing professional development’; ‘IPR’ = ‘intellectual property rights’. Source: HE‑BCI Part B Tables 1, 2 and 4c.

Facilities and equipment

12. Income from use of facilities and equipment (for example, prototyping equipment or digital media suites) rose by 17.5 per cent overall to £191 million. Income from large business accounted for the majority of this increase, with a rise of 29 per cent from £48 million to £62 million; this figure does not include an amount erroneously reported by an institution and published in the HESA data release in April 2016. Public and third-sector organisations saw a rise of 11.0 per cent, from £63 million to £70 million. SMEs saw growth in income of 14.8 per cent, from £51 million to £59 million, although the number of SMEs using these services reduced by 15.3 per cent from 17,037 to 14,433.

Intellectual property and enterprise

13. HE-BCI identifies income from licenses and the sale of spin-off companies as intellectual property income (‘IP income’), although it is understood that almost all activity (collaborative research, continuing professional development and so forth) stems from the intellectual assets of HEIs. Licensing and spin-offs are perhaps better described as income from formal intellectual property rights. There has been an increase of 18.5 per cent in IP income, from £131 million to £155 million in 2014‑15, with software and non-software licenses rising in value from £82 million to £103 million, an increase of 25.1 per cent.

Social, community and cultural activities

14. Attendance at public events has rebounded from last year, with a rise in attendee numbers of 47.3 per cent at free events and 14.5 per cent at chargeable events. The increase in free event attendance is largely attributable to an increase in the ‘other’ category of 187 million.

Regeneration

15. Income from regeneration programmes continued to increase in 2014-15. There was an increase in each indicator, with the exception of European Structural Fund income which saw a decline of 43.7 per cent, falling from £21 million to £12 million. The overall increase in regeneration income to UK HEIs was 13.3 per cent, from £181 million to £205 million.

16. Data on capital income has been collated as part of the HE-BCI return for the last couple of years. A summary of this data will be included in future annual reports.

Continuing professional development

17. Income from continuing professional development and continuing education activity rose from £678 million to £715 million in 2014-15, an increase of 5.4 per cent. The biggest growth in value again came from individuals (who may include sole traders as well as those studying for personal interest), who increased their collective spending by 7.5 per cent, from £253 million to £272 million; this figure does not include a sum corrected after the HESA release of data in April 2016. SMEs increased their spending by 12.9 per cent, and public and third-sector partners had an increase in spending on continuing professional development of 3.2 per cent. Income from large businesses rebounded after the previous year’s fall, with an increase of 4.6 per cent.

Action required

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


1 Data from the University of Buckingham and University Campus Suffolk is excluded from this report as these institutions are not publicly funded HEIs. This year, data from Plymouth College of Art and the National Film and Television School has been included for the first time.

3 The ‘third sector’ refers to voluntary and community groups, social enterprises, charities, co-operatives and mutuals.

Date: 17 August 2016

Ref: HEFCE 2016/19

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; Public engagement; Strategic planning; Economic development