What might the Brexit Deal mean for university-business collaboration?

At the eleventh hour, a Brexit Deal was agreed with the European Union. The Deal is a testimony to the commitment of negotiators and influencers on both sides. Beyond the details of the Deal, the fact that a deal was reached at all is important.

It sets a positive tone for future relations between the UK and the European Union, agreeing terms for future trade and engagement. Most businesses do not have to prepare for the prospect of tariffs and quotas and there is more clarity on UK involvement in EU programmes.

Critically, both sides enter the new year with an eagerness to make the agreement work.

Many of the activities that universities and businesses collaborate on – such as research, innovation and education – are underpinned and strengthened by global interaction. 2020 and the Covid-19 pandemic has cast a spotlight on the importance of collaboration to protect our health, wellbeing and prosperity.

So what does the Deal mean for university-business collaboration? We offer our first reflections below.

Successful collaborations, require strong partners

Achieving a deal has reduced the level of disruption felt in the new year across many UK industries. The EU and UK achieved their shared ambition to remove tariffs and quotas on all goods. This goes further than any other EU trade deal with a third country. The Deal will not remove the need for customs declarations and paperwork for traders, but will simplify it in some instances.

This will mean that most businesses will be facing a lower level of change than they would be in a no-deal scenario. Whilst the world continues to face the Covid-19 pandemic and the unprecedented disruption it has caused, the Deal is welcome news for most UK businesses. A lower level of disruption and uncertainty also makes it more likely for collaborations with universities to be sustained.

However, analysts do suggest that the Deal for the services sector is limited. The general provisions in the agreement suggest extensive market access for services, but the large number of exceptions in the annexes vary by sector and member state. This may lead to greater disruption in some parts of the services sector than others, with wider implications for the UK economy and collaborations.

Continued collaboration with the EU on research

Many researchers were relieved to hear that the UK will continue involvement in the EU’s flagship Horizon research programme, which plays an important part in supporting global research collaboration.  The agreement commits the UK to further negotiations to formally “associate” with the programme. These negotiations on the details of association are likely to take some time – but the commitment to UK involvement in the programme is positive.

Over half of the UK’s academic research publications are the product of international research collaborations and evidence suggests that collaborative research has a greater impact. Our researchers and innovators come here from around the world to share and build their knowledge and expertise. Association to the Horizon programme, on fair terms, will help to maintain our close research relationships around the world.

The UK will also continue to have a role in four other EU programmes: the Euratom nuclear research programme, the ITER project to build the world’s first functioning nuclear fusion system, the earth monitoring project Copernicus, and EU satellite surveillance and tracking services. Notable by its absence, UK-based companies will not be allowed to compete for financing in the European Innovation Council’s Accelerator Fund. The UK will keep its place in the European Research Infrastructure Consortium programme, which offers infrastructure funding for big research facilities across Europe.

No automatic recognition of professional qualifications

There will no longer be automatic recognition of professional qualifications. From the 1st January 2021, UK nationals planning to service clients in the EU, and EU citizens holding UK qualifications, will typically need to have these qualifications recognised on a state by state basis in the EU. This will have implications for businesses, who may find it more challenging to hire professional staff from the EU, as well as individuals, graduates and students who may have reduced opportunities to practice overseas.

The big question will be how easily sectoral qualification bodies in the UK and EU are able to agree mutual recognition on a country by country basis in the years to come. Encouragingly, the UK has already committed to seeking mutual recognition of professional qualifications in its trade negotiations with India.

No special treatment of EU students

This was already known, but it is worth remembering that the UK’s withdrawal from the EU will mean that EU/EEA students starting in the 2021-22 academic year will no longer be able to access the UK’s student loan system and will no longer be charged at home fee rates. EU/EEA students will also have to apply for a new Student Visa to study in the UK.

The UK will not participate in Erasmus plus

The UK will not associate to the EU’s student exchange programme, Erasmus plus, but will set up an alternative Turing Scheme. The details of this scheme are not yet known.

Analysis shows that offering students an international experience as part of their degree can improve their employability, particularly amongst those from disadvantaged backgrounds. In a globalised world, it is in the interests of students, universities and also employers to create these opportunities.

Impact on global relationships and decision making remains to be seen

Of course, many questions remain as to how the end of the transition period will impact different aspects of university-business collaboration. Indeed, the details of many elements of the agreement will require further negotiation.

Perhaps most importantly – the Deal only determines the framework of a future relationship. In practice, the nature of “the relationship” will largely be shaped by the individual actions of people, businesses, organisations and leaders. As well as, of course, domestic decisions on regulation, immigration, and fiscal policy.

The UK has a global reputation for research and talent. Over half of UK R&D spend comes from business. In 2018, 53% of business-based R&D was funded and performed by foreign-owned businesses and since 2011, foreign-owned businesses based in the UK have invested more in R&D than British-owned businesses.

It’s therefore critical that discussions about the challenges and opportunities of Brexit do not end now that a deal has been struck.

Many decisions still need to be taken, not least a further six months of negotiations on post-Brexit data flows and negotiations on Horizon terms. The UK will also have important decisions to make about its own domestic laws and regulations, including new opportunities to adjust state aid rules and develop Freeports.

For now we have taken an important step towards building a new relationship with the European Union. Continued collaboration is critical to making it a success.