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The Black Hole

Year-end spending inhibits proactive planning

Universities that frequently make additional funds available for a short period of time risk alienating new projects from early career researchers who don’t have large, established teams.

BY DAVID KENT | APR 12 2022

Over the last couple of months, I have been sent a steady string of emails with reference to various funding sources internal to our university, but the vast majority of them come with a substantial string attached – “funds must be spent by July 31, 2022.” On one hand, it is great that additional funds like this exist, but on the other, the push to spend rapidly prompts a number of issues around equality and good decision-making, especially when viewed through a research lens. I can completely understand the desire to “balance the books” each year in order to assess the financial health of an institution, I just get concerned when the methods employed run counter to our ability to run productive research programs.

Impossible to hire new people

Let’s start with the super practical issue of “who will do the research” – unlike a short-term evaluation project or website redesign, scientific research projects can rarely be executed across a tight three- to four-month period. Add to this the sometimes tense issue of snail-like hiring practices in many U.K. institutions and you could hardly imagine recruiting somebody before the spending period was over. Therefore, when short-term spending is released to stimulate new scientific projects, this typically means that the only people able to undertake projects are currently extant researchers within an organization.

Inequality of access

These pots of money are consequently stacked in favour of those with more flexible funding or larger groups of people. Imagine a 10-person lab group funded by three research grants with different end dates, and compare their situation to an early career researcher running a group with a single technician employed on a fixed-term external grant. Which of these do you think can move money around to utilize a three- to four-month pot of funding more easily? If you are organized within a larger research cluster of multiple lab groups, this flexibility is even greater. Once again, the system favours those who already have the resources and it driven by an almost completely artificial need to balance the books rather than to think carefully about what (or who!) needs to actually be funded.

Poor-quality spending decisions

The other annoying feature of short-term “use it or lose it” budgets is that it inevitably drives some people to spend money on things that they absolutely do not need and/or will never actually even use. This is already problematic enough with last-minute spending at the end of a grant period, which has prompted some granting agencies to have longstanding rules banning equipment purchase in the last months of a grant. If you bind an entire pot of money to a three- to four-month period, you again encourage this short-term thinking, once again making it difficult for researchers to plan their experiments and make sensible strategic decisions.

Why can’t university budgets operate with liabilities?

This sort of issue always makes me wonder why university departments can’t be more comfortable with a list of liabilities or commitments that carry on into the next X number of years. I’m not suggesting that we mortgage the entire financial future of a university department, but surely some percentage of an overall operating budget could have a modicum of risk associated with it in order to give researchers the flexibility they need to achieve research goals in a more sensible and equitable manner. Keeping an accurate account of these liabilities need not be an issue, and in the event of a proper financial crisis that shuts down the ability to fund new projects, there may even be some silver lining in the ability to purge some of these liabilities to make for an easier navigation through said crisis. Practically speaking, if you could award the money in a current fiscal year and know that it would be spent in the next 18 months rather than the next four, would it really change things from a financial perspective? It certainly would from the researcher’s side.

At the end of the day, universities seem to be incredibly risk averse when it comes to betting on future income. We’ve just been through arguably one of the most disruptive periods of student dynamics (Brexit, COVID-19, etc.) and, even in this context, student enrolment remains relatively healthy. Similarly, research funding agencies are showing signs of recovery and new investment – surely this gives us some scope to be slightly more adventurous in our planning decisions.

Better planning can help

In the event that the system cannot change (or will not change quickly enough), there are things that can be done to improve our ability to deal with sporadic surpluses. For one, if you’ve noticed this annual pattern in your institution, it would be silly to be surprised by it happening again next year. This might allow you to dream up your project well in advance of the time, plan your resources and staffing around the chance that money may exist three to four months before year end and be “ready to act” when it does become available. Secondly, you can think creatively about your own staff and grant expiry dates. In the (lucky!) event that you have a long-term funding pot of five years, you can potentially save money on those “non-expiring budgets” by utilizing the transient pots of temporary cash each year. Again though, both of these strategies strongly favour those with flexibility in their already existing funding or research portfolios that will inevitably disfavour new ideas from early career researchers. If the rules around time-limited spending could just be relaxed a little, it could open up a huge array of possibilities for those institutions willing to bear just a little bit of extra risk.

ABOUT DAVID KENT
David Kent
Dr. David Kent is a principal investigator at the York Biomedical Research Institute at the University of York, York, UK. He trained at Western University and the University of British Columbia before spending 10 years at the University of Cambridge, UK where he ran his research group until 2019. His laboratory's research focuses on the fundamental biology of blood stem cells and how changes in their regulation lead to cancers. David has a long history of public engagement and outreach including the creation of The Black Hole in 2009.
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