STIINPL › Public sector research - core policy instruments - discretionary organisational funding
Discretionary organisational funding, commonly known as ‘block grants’, is the traditional funding instrument for public research. It is targeted at research universities and PRIs rather than at individual researchers and research groups and involves them receiving public funds according to various criteria (e.g. formulae, performance indicators, or budget negotiations) to fulfil their research and teaching missions. Discretionary organisational funding provides these organisations with stable funding and a certain degree of autonomy in the selection of their research.
Broadly, what activities and outcomes does discretionary organisational funding seek to influence?
Discretionary organisational funding typically covers the salaries of many research and support staff in research universities and PRIs and contributes substantially to the costs of operating and maintaining much of the hard infrastructure needed to perform research, including laboratories, collections, and libraries. It also provides research universities and PRIs with a certain degree of freedom to support chosen research areas according to their strategic priorities and particular research strengths and focus. This type of funding contributes most to supporting the scientific record but also influences the pace and direction of technological development in those research institutes where this is a major objective.
How does discretionary organisational funding have an influence?
Discretionary organisational funding is used to support the necessary conditions for a healthy research system. It provides much-needed stability in funding that allows research performing organisations to invest in research equipment and buildings, to provide researchers and support staff with open-ended employment contracts, and to undertake lines of research over the medium-to-longer term that might also be more curiosity-driven. Competitive R&D project grants, by contrast, cover only some of the overheads of performing research, are of relatively short duration (typically 1-3 years) and often have a short-term, problem-oriented orientation. Discretionary organisational funding also provides public research with a degree of autonomy, a central pillar of the scientific community’s ‘contract’ with society.
OECD countries use different approaches (e.g. formulae, performance indicators, or budget negotiations) for calculating the allocation of discretionary organisational funding. In recent years, there has been a tendency for countries to move from input-oriented to more output-oriented funding:
What factors should be considered when implementing discretionary organisational funding?
Several factors should be considered when implementing discretionary organisational funding:
HEFCE (2010), Guide to funding: How HEFCE allocates its funds, Bristol: Higher Education Funding Council for England.
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