Sarah Jackson, Director of the N8 Research Partnership, published her report on efficiencies in higher education earlier this year. We thought we’d catch up with her now that she’s gone back to her day job.
Over the past year, you were wearing two hats – is that right?
Yes – I was very lucky to work at the Department for Business, Innovation and Skills for six months on a part time secondment. The project was essentially to bring together all the good practice within universities on effectiveness into a single report.
It was a fantastic role as I got to speak to many different people from across the sector – in academia, in HR, in finance, in careers services. Everyone I spoke to was very keen to share their stories on how they have used efficiencies as a mechanism to improve performance in their university.
I found lots of evidence of where savings had been made, and how these were being reinvested in front line services for students.
For example Newcastle University is saving £1.7m a year through improvements in procurement. This cash has been injected into giving students more of what they want: the library is now open 24/7, and students have access to more personal tutors and more work placement opportunities.
The “Diamond Review” showed that universities had made headline savings of over £1.38bn between 2005-2011. Efficiency is now part of core business for universities and is improving both teaching and research, but it certainly isn’t ‘job done’.
So why does this continue to be important to the sector?
I can give you three reasons.
Firstly, and fundamentally, it is vital for the economy. As Sir Andrew Witty’s report said, universities “are already a major competitive advantage for the country and I believe we could do more to maximise this”. Making the best even better at what they do is crucial for economic competitiveness.
Secondly, other countries recognise this and are investing heavily in their universities. We need to look at new ways of ensuring that maximum resource is going into the things that count to increase excellence and performance.
Thirdly, we need to make sure we continue to communicate what universities are doing in this space, particularly the ten year track record of efficiencies. Flag waving about efficiency might not always grab the headlines, but the evidence is there and we need to get better at telling this story, or our ability to compete globally might suffer.
This is part of the reason why the next phase of Professor Ian Diamond’s work with Universities UK and a range of partners is so important – it shines the spotlight once again on how universities are achieving efficiency and effectiveness.
Where does N8 fit in to all this?
The N8 Research Partnership is a partnership of the eight research intensive universities in the North of England – Durham, Lancaster, Leeds, Liverpool, Manchester, Newcastle, Sheffield and York. We are working together on equipment sharing to make the most of science capital funding and ensuring researchers have access to the state-of-the-art research equipment across the 8 institutions.
We worked with the EPSRC to understand how and when to share, and what benefits sharing can deliver. The resulting report, by Professor Luke Georghiou, found that equipment sharing yields three key benefits.
Firstly, sharing creates concentrations of research activity between universities and within industry, it increases efficiency by reducing the number of items that need to be purchased and obtaining higher load factors on existing items, and finally it allows capital items to be acquired that would be too large for a single institution to purchase.
We also looked at ways of making it easier for universities to share and created an equipment database so that researchers are aware of what equipment is available and where it is located.
We also need to understand costs, frequency of use and travel time to decide where sharing is most cost effective. We also need to have frameworks in place to support the costs of sharing and to ensure IP and health and safety issues are agreed up front.
So the potential benefits are there, but the challenges can be tricky!
There’s always a ‘but’, isn’t there.
Yes, there is a particular one about VAT. Bear with me here!
Unless the right arrangements are put in place, VAT may be charged between institutions who share equipment, which of course will increase costs by 20%. HMRC introduced the VAT exemption in 2012, and to take advantage of this, the trade or services need to be within a Cost Sharing Group arrangement. This can of course apply to equipment sharing or other shared services.
We are working to implement a Cost Sharing Group arrangement and set up 8 CSGs so that when researchers use a piece of kit at a neighbouring institution (instead of requesting a new one from the Research Councils), this sharing is not subject to VAT.
It is proving difficult to gain approval for this structure as the exemption is newly introduced into UK law and so there are no precedents set. However, we are currently working with HMRC and BIS to try and move this forward.
It is expensive and time consuming to put in place, but we believe in it – it is part of our commitment to the asset sharing agenda as a way of supporting our researchers to have access to state of the art kit, to collaborate with other institutions and industry, and maximise the benefits of the science budget.
HEFCE has launched a fund for institutions to support these sorts of arrangements.
Where do you go from here?
The immediate priority for us is to get the Cost Sharing Group arrangement approved, and then we can disseminate this model to the rest of the sector – we want to save other institutions further accountancy fees!
We are also working hard on putting a simple, light touch framework in place to cover sharing operating principles relating to health and safety, charging and IP. A team of experts from across the eight universities are working to pool their expertise and come up with the answers to some of these very difficult questions which will be shared with the sector.
More on this very soon…
Sarah Jackson is Director of the N8 Research Partnership
A version of this content also appears on the Guardian higher education management and administration hub.