Institutions failing to recover costs of research

A new report from CIMA warns of a big gap between the funding and the costs of academic research. It also provides a guide to tackle the problem of covering overheads.

For externally funded research, it was found that higher education institutions receive a range of contributions to indirect

Ian Haythornthwaite (Fellow) and former director of finance, now Pro Vice Chancellor of the University of Central Lancashire, explained: 'Institutions are failing to get the right price because they are unable to demonstrate exactly how much research costs. Many institutions could see a rapid financial return from the introduction of an effective costing system'.

Academic delivery in higher education embraces many diverse activities, such as general teaching, contract teaching, research, contract research, consultancy, academic conferences and technology transfer. 'Without an effective costing system', continued Mr Haythornthwaite, 'management cannot evaluate the full cost and revenue generated by such a diverse portfolio of services and use this data to inform future strategies and value-for-money assessments. It should supply a management support system to inform decision-making, value judgement, resource allocation (including level of subsidy) and strategy at many levels across the institution.

'HEIs could vastly improve their negotiating positions with all external sponsors if they were able to demonstrate the true, full cost of the work they undertake, instead of allowing both sponsors and staff alike to believe that overheads are funded by other means. CIMA is working with institutions to succeed in this: the adoption of the system laid out in our guide will make a huge difference'.