The end of EU Structural Funds in the UK post-Brexit will leave many important research, innovation and skills projects face an "urgent cliff edge", Welsh universities have warned MPs.
Speaking at an event in Westminster, Professor Paul Boyle, chair of the Universities Wales Research and Innovation Network, and Vice-chancellor of Swansea University, told cross-party MPs that without urgent bridging funding 60 research projects would come to an end this year, putting 1,000 University jobs at risk.
Around £370m was invested in university-related projects in Wales through the European Regional Development Fund (ERDF) and the European Social Fund (ESF) between 2014 and 2020 and the subsequent tail off years. Universities in the UK provide a huge amount of support to businesses in the form of consultancy and contract research.
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In terms of ROI and economic benefit, a recent report from Universities UK found that universities delivered contract research worth £1.4bn to businesses and non-commercial organisations in 2020-21. Welsh universities contribute £5 billion of output to the Welsh economy and generate over 1 in every 20 jobs.
However, Universities Wales has said the end of EU Structural Funds now means that decisions have to be taken which could lead to the loss of the talent and infrastructure needed to support regional development in Wales. The cost of providing bridging funds to continue supporting these ESIF funded projects in Wales for a further 12 months is estimated at around £71m.
"Universities play a crucial role in innovation, which in turn leads to the creation of new businesses, new jobs, and improving wages. This is one of the key economic benefits that our universities deliver for the nation, generating over £5 billion of output for the Welsh economy annually," he said, adding: "In an increasingly competitive global marketplace, we risk failing to exploit one of this country’s most enduring and internationally recognised strengths."
“Stepping back from the cliff edge would save hundreds of jobs, support a range of cutting-edge innovation projects that are driving economic growth, and provide direct investment in areas that the UK government has stated are at the heart of its own levelling up ambitions."
Universities Wales Chair Professor Elizabeth Treasure said: "EU Structural Funds enabled us to build on our research and innovation activity, work collaboratively across institutions and regions, and strengthen the link between skills development and research and innovation.
"As well as supporting knowledge exchange, these projects enabled us to upskill more people in Wales of all ages and backgrounds. The reality is that projects such as these are at risk, and this impact will be felt in regional economies across the whole of Wales."
The UK Government pledged to award £2.6bn of replacement funding through its UK Shared Prosperity Fund (UKSPF), administered by the Department for Levelling Up, Housing and Communities, led by Michael Gove. But Swansea University said the mechanism for distributing these funds locally makes securing funding for large-scale collaboration at cross-regional and Wales-wide scale almost impossible.
Horizon Europe, the EU's key £80bn funding programme for research and innovation until 2027, is also open to UK-based researchers following negotiations to stay in the project as part of the 2020 Trade and Cooperation Agreement. The agreement would allow UK-based researchers to apply for the funding on the same term as EU-based applicants.
However, the EU has told the UK that it cannot take part in Horizon Europe until the dispute over the Northern Ireland protocol is resolved leaving many universities seeing their funding plunge. Recent reports suggest that Prime Minister Rishi Sunak is looking to resolve the dispute with the EU which, once settled, would allow the UK to rejoin the innovation programme.
EU funded projects in Wales include Swansea University's SPECIFIC, which is researching printable solar cells and material that store summer heat for winter use. AberInnovation by Aberystwyth Uni provides world-leading facilities and expertise within the biotechnology, agri-tech and food and drink sectors.
While FLEXIS is a project led by Cardiff University that helps to drive green and economic growth across Wales, through industrial partnerships collaborating on the commercialisation of research to decarbonise future energy supply.
Labour MP for Swansea West Geraint Davies said: "Our universities play a vital role as economic engines across Wales, bringing jobs and investment to their local areas. These projects are important to our UK ambition to crank up sustainable economic growth, so their sudden loss would be a big blow to our communities our economy and all our longer-term interests.
“That’s why providing immediate bridging funding of just £71 million is of such importance. I will continue to work with our higher education sector and other MPs calling on the UK government to safeguard these projects and jobs to enable our universities to continue to deliver for the people and places of Wales.”
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