Introduction
This technical guide is aimed at those in planning and finance offices who need to have a good understanding of how Research England’s Higher Education Innovation Funding (HEIF) grants are calculated.
For information about the strategic purpose of our funding refer to How we fund higher education providers (HEPs).
Common principles and definitions are provided in general notes for Research England technical guides.
There are two budgets associated with the HEIF algorithm, the main budget and the top-up budget. The top-up budget is only distributed among HEPs receiving the maximum main HEIF allocation.
Eligibility
Refer to the Research England terms and conditions for general eligibility conditions for our funding.
To be eligible for HEIF funding, HEPs must be determined to be eligible by a separate HEIF eligibility algorithm, which assesses HEPs on the following criteria:
- registration with the Office for Students (OfS) in the approved (fee cap) category of the OfS register
- a demonstrable level of knowledge exchange activity, including evidence of knowledge exchange activity and a track record of knowledge exchange
- the Research England verification stage – Research England reserves the right to review the eligibility of any provider on an annual basis.
Data used
The three most recent years of the following data are used to inform the HEIF algorithm.
HESA Higher Education Business and Community Interaction (HE-BCI) survey
Table 1 (Research related activities):
- Total contract research income
- SME contract research income
Table 2 (Business and community services):
- Total consultancy income
- SME consultancy income
- Total facilities and equipment related services income
- SME facilities and equipment related services income
Table 3 (Regeneration and development programmes):
- Total regeneration and development income
Table 4 (Intellectual property [IP]):
- Total IP income (excluding sales of shares in spin-offs)
- SME IP income
OfS Annual Financial Return (AFR)
Table 6:
- Total non-credit bearing course fees
- Knowledge transfer partnership income
Calculation method
Step 1
The list of HEPs eligible for HEIF is obtained from the output of the HEIF eligibility model.
Step 2
A volume measure is calculated as the sum of eligible income for each respective pot, with relevant weights applied:
- the most recent three years of data is collected from each data source
- in unusual cases where a data point is missing, the most suitable available data is used as a proxy. For instance, where the most recent data is missing, the prior year’s data value would be used instead
- relevant weights are applied: weighting of 2 for SME activity, weightings of 5:3:2 for each year of data are applied respectively, from newest to oldest
Step 3
The minima, maxima, caps, and thresholds are calculated for each provider, according to the conditions defined in the Summary of constraints.
Step 4
The main HEIF budget is distributed in proportion to the volume measure calculated in step 2.
Step 5
The HEP-specific constraints calculated in step 3 are applied to each HEP’s allocation. Any surplus or deficit is redistributed in proportion to each HEP’s volume measure
Step 6
Step 5 is repeated until the main HEIF budget is distributed.
Step 7
The HEIF top-up budget is distributed in proportion to the volume measure among HEPs allocated the maximum main HEIF allocation.
Step 8
The conditions on the HEIF top-up allocation specified in Summary of constraints are applied. Any surplus or deficit is redistributed among HEPs eligible for the top-up that are not limited by the constraints.
Step 9
Step 8 is repeated until the HEIF top-up budget is distributed.
Summary of constraints
All constraints on HEIF allocations are reviewed annually.
The following constraints currently apply to the HEIF allocations for all HEPs:
- new entrants, defined as HEPs receiving HEIF for the first time (or for the first time after a break in funding) in the current year or the previous year, have their allocation capped at £500,000
- for HEPs who received HEIF in the previous year, their allocation for the current year is restricted to be within plus or minus 10% of their last year’s allocation
- HEPs are subject to a threshold allocation of £250,000, any HEP allocated less than this receives £0
- HEPs are subject to a maximum main allocation of £4,743,000
HEPs achieving the maximum HEIF allocation are eligible for the HEIF top-up, where the following conditions apply:
- a minimum top-up allocation of £200,000
- a maximum top-up allocation of £1,016,000