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A review of a HEFCE programme which funds development projects in the higher education sector has found significant benefits for students, the economy and society, with funding expected to return up to £12 in value for every pound invested.

The independent report, prepared by Deloitte, analysed the impact of the Catalyst Fund and a previous scheme, the Strategic Development Fund, both funded and managed by the Higher Education Funding Council for England.

The Catalyst Fund is a flexible investment programme designed to respond to new policies and priorities. It supports strategic projects led by universities and colleges, enabling innovation and change across higher education, supporting the interests of students and encouraging universities and colleges to work in partnership with employers and others.

The fund supports new projects which need extra investment in their early phases to increase their chances of long-term success. Projects cover a range of activities from technical and skills development to new advances in science, technology, engineering and mathematics; and from student safeguarding to tackling the barriers to students’ success. This is also one of the few funding streams available to support new teaching and learning activity.

The Deloitte report found that:

• The estimated current return on investment for the Catalyst Fund is £2.91 to £4.64 of supported direct and indirect gross value added for every £1 of investment, over the 10 years after the HEFCE funding period, based on current case study analysis.
• Analysis of similar projects funded under the Strategic Development Fund indicates a net additional return of £12 for every £1 of HEFCE investment as projects become more established over time.
• The funding has a direct benefit in promoting collaboration between academia and industry, helping drive productivity in the local and national economy.
• These collaborations play an important role in encouraging research and growth in small and medium-sized enterprises.
• The funding encourages regional development, with HEFCE’s support for these projects promoting the role of universities as ‘anchor’ institutions in their regions.
• The projects effectively drive innovation and change across individual universities and more widely in the higher education sector and in partner organisations.

The report includes many examples of the types of projects supported.

Commenting on the report, Universities Minister Jo Johnson said:

‘It is encouraging to see the clear value for money from the Catalyst Fund – currently returning up to £4.64 for every £1 invested – with projects ranging from strengthening links with local employers to improving student safeguarding on campus.

‘Closer collaboration between universities and industry is critical to boosting graduate outcomes and earning power when they secure their first job. I look forward to seeing future projects from the fund deliver for students, universities and the wider economy.’

Professor Madeleine Atkins, Chief Executive of HEFCE, said:

‘This report confirms the high value of investments such as the Catalyst Fund in supporting the development of the UK’s world-leading higher education sector. We are pleased that the report has recognised the range of benefits and enhancements that this type of investment is delivering for students, universities and colleges, and a range of partners. We are working with all projects to ensure maximum value from our funding and investment.’

The Deloitte report on the economic impact of the Catalyst Fund is available at www.hefce.ac.uk/pubs/rereports/year/2017/cfeconimpact/. 

Notes

1. The Catalyst Fund, managed by HEFCE, has been operating since August 2012, building on the success of its predecessor the Strategic Development Fund.
2. The Catalyst Fund is currently supporting over 200 projects, with an investment of approximately £230 million in revenue and capital support.
3. HEFCE will also be announcing new investment to support the prevention of hate crime and online harassment for students, funded through the Catalyst Fund.
4. The fund provides exceptional funding for project-based activities. Areas supported include:
   • new developments in science, technology, engineering and mathematics
   • technical higher education and skills developments for students and industry
   • student safeguarding activity
   • addressing barriers to student success
   • economic growth and productivity
   • strategically important provision
   • new interventions at the interface of teaching, research, and knowledge exchange.
5. HEFCE commissioned Deloitte to undertake a study of the economic impact of the Catalyst Fund in September 2016. This is the first study of its kind on this type of HEFCE funding.
6. The analysis involved reviewing a selection of funded projects in depth. The chosen projects represent the range of funding provided and the variety of objectives for which Catalyst funding is being used. As part of the work, Deloitte also considered the impacts of some of HEFCE’s previous investments through the Strategic Development Fund, to understand better the likely longer-term value and impact of this type of investments.
7. Starting on 16 October HEFCE will publish a series of blog posts by projects supported by the Catalyst Fund – see http://blog.hefce.ac.uk/.