Higher Education Innovation Fund

We provide funding for knowledge exchange (KE) via the £213 million Higher Education Innovation Fund (HEIF) to support and develop a broad range of knowledge-based interactions between higher eductation providers (HEPs) and the wider world, which results in benefits to the economy and society.


The aim of HEIF is to create and sustain a range of KE activities in response to demand across the economy and society.

It is designed to support and develop a broad range of knowledge-based interactions between HEPs and the wider world, which result in economic and societal benefit to the UK.

In September 2019, the Universities Minister Chris Skidmore announced a new strategic direction for university knowledge exchange funding to drive the high performance needed to deliver the government's commitment to raise research and development investment to 2.4% of GDP. This included confirmation that that the total amount of HEIF funding will increase by £25 million in 2020-21.

What HEIF supports

HEIF supports and incentivises providers to work with business, public and third-sector organisations community bodies and the wider public, to exchange knowledge and increase the economic and societal benefit from their work.

HEIF provides a strong return on investment, with £9.30 generated for every £1 of funding.

Performance-based allocation

HEIF allocations are performance based, informed by the results of the annual Higher Education Business and Community Interaction (HE-BCI) survey and other data, and underpinned by institutional strategies for KE.

Institutional plans to support the Industrial Strategy

In 2017-18, HEFCE made available an additional £25 million of HEIF to support the delivery of the Industrial Strategy. This was followed by Research England increasing HEIF again for 2018-19.

Because this additional funding was made available specifically for supporting the delivery of the UK's Industrial Strategy, in the spring of 2018 we called for additional plans to sit alongside the existing institutional strategies.

We have published a report which summarises uses of Industrial Strategy uplift allocations through HEIF and Industrial Strategy related developments in universities, based on evidence from the plans for HEIF submitted to Research England.

HEIF annual monitoring

Institutions in receipt of a HEIF allocation are required to provide an annual monitoring statement (AMS) to Research England each winter. The AMS documents relating to the 2018-19 HEIF allocation, issued directly to relevant HEIs in late November 2019, must be returned by midday on Friday 28 February 2020. A guidance document to support the completion of the 2018-19 HEIF AMS return (PDF) is available.


How do you allocate HEIF?

HEIF is allocated by formula to all eligible providers, subject to acceptance by Research England of an institutional strategy and plan for knowledge exchange.

For more detailed information see funding allocations.

What criteria do you use to judge an institution's eligibility for HEIF?

In order to receive HEIF, providers must provide to us, and have approved, a strategy and plan. These strategies must meet the following criteria:

  • The institution must have a sound strategic approach to KE, in line with the institution's individual corporate strategies and core institutional mission, and linked with appropriate management systems. It must have identified its main intended outcomes and impacts for the economy and society, and must give us the confidence that it has ways to monitor and evaluate activity to demonstrate that it is achieving these outcomes and impacts.
  • The institution must have a sound approach to the management of its KE activities, including demonstrating that it is actively seeking efficiency and effectiveness. It must have a strategy in place to maximise the opportunities to collaborate with other UK HEPs to use its higher education and research grant most efficiently.
  • HEIF is being spent in line with overall objectives of the programme and appropriately in the context of the institution's overall strategic approach to knowledge exchange and national policies / priorities.

How do you calculate allocations for individual providers?

To target KE funding where it can support higher education knowledge and skills to have the greatest impact on the economy and society, we only give HEIF to providers with evidence of significant KE performance and partnerships.

To judge this, we use data on the income received by an institution from its users - businesses, public and third sector services, the community and wider public - as a proxy measure for the impact of its KE activities.

We calculate allocations for individual providers by adding together their main KE income indicators. This data is collected through:

  • data that providers submit to the Higher Education Statistics Agency (HESA) in the Finance Record and Higher Education - Business and Community Interaction (HE-BCI) Record
  • data on knowledge transfer partnerships from Innovate UK.

We take account of income over a three-year period, weighted towards the latest year of performance, providing a balance between stability and dynamism.

Is the increase of HEIF to £250 million from 2020-21 a new announcement?

The government's commitment to the increase of HEIF to £250 million was published in the Industrial Strategy, and confirmed in the UKRI Delivery Plan. We are now confirming details: that decisions on allocations will be made as part of Research England and the Office for Students' funding rounds in spring 2020, and published along with details of a long-term review of the HEIF method.

Who makes decisions on HEIF allocations?

Decisions are made by Research England in conjunction with the Office for Students (OfS), taking into account government, UKRI and Department for Education priorities in annual grant announcements and guidance letters, and advised by the Research England Council.

Will the method for HEIF allocations in 2020-21 be different from 2019-20?

The Minister announced that there will be a long-term review of the HEIF method that will inform allocations in the later part of the next HEIF planning period, which runs from 2020-21 to 2024-25. It is likely then that there will be continuity in 2020-21 with the method set out for the last planning period, 2016-17 to 2020-21, in HEFCE circular 2016/16. The approach to allocations will though need to consider the use of the additional £25 million being made available to support the delivery of the Industrial Strategy from 2020-21 onwards.

Will new policies and priorities for HEIF be published alongside 2020-21 allocations?

Revised guidance updating HEFCE 2016/16 will be published in RE funding round documents for 2020-21 allocations, taking account of any new government, UKRI or OfS priorities (for example, in the Spending Review). Guidance in spring 2020 is though unlikely to change significantly from HEFCE 2016/16. RE will publish new guidance for the new HEIF method later in the period, which may be significantly different from the current approach to date. Hence, we do not want to implement two significant changes of approach within one planning period.

Will a new round of HEIF strategies be requested?

We set out in the RE delivery plan our approach of asking for long-term accountability statements as the basis of HEIF allocations. These are likely to be more narrowly focused on uses of HEIF than previous strategies, so as not to duplicate unduly information submitted for the KEF and KE concordat exercises. Details will be set out in RE funding round documents in spring 2020. New guidance on the next method for HEIF is also likely to cover appropriate accountability requirements.

Why are you reviewing the HEIF method?

Our decision to review the funding method reflects that we have made good progress to develop the KEF as a more accurate approach to measuring KE performance, which is the focus of the HEIF allocation method; and our progress has been praised by the Universities Minister as meeting government priorities. It also reflects that the HEIF method has not been the subject of full consultation since its inception in 2006.

There have also been various incremental changes to the method over time to address specific policy priorities, and the review gives us an opportunity to look at the best means to address all these. A new method will also allow us to consider how to address new policies, for example how to give greater attention to student contributions and benefits, which is the subject of our current joint call with OfS.

How will a new HEIF method be developed, and when?

Further information on the approach to making changes to the HEIF method will be published as part of RE documentation in the spring 2020 funding round. The approach is likely to include: a review of the principles and strengths and weaknesses of the current method; consideration of any new government, UKRI and OfS priorities and availability of funding; construction of a new method based on a further developed KEF; and full consultation. RE and OfS intend to use the new method to make HEIF allocations within the later part the next planning period which runs from academic year 2020-21 to 2024-25.

What are HEIF five year strategies?

In August 2016, HEFCE asked providers eligible for HEIF to complete an institutional five year strategy. These strategies, together with an overview report, may be found on the HEFCE website.

Research England expect to call for new five year strategic documents in the summer of 2020, to form the basis for release of HEIF allocations from the next planning period 2020-21 to 2024-25.

Is there a cap on individual allocations?

Yes. There is a cap on individual allocations so that no one institution receives a level of funding that disadvantages others. Where there is evidence that the cap is a constraint on an institution's support of economic growth, we provide a supplement to enable their KE strategies to be enhanced. The supplement is based on the providers shares of qualifying income (calculated according to the main KE allocation method).

How often are allocations re-calculated?

Allocations are re-calculated annually based on the latest data and to reward recent performance. But we also moderate year-on-year changes to give providers a level of predictability so that they can draw up five-year KE programmes.

How do you work with the Office of Students?

Although we provide most of the HEIF from our budget for supporting KE, a proportion of it is provided by the Department for Education from its budget for teaching in higher education providers. We therefore work with the Office for Students, which oversees teaching funding, to support its evaluation of the teaching and student elements of HEIF and to ensure joint agreement of strategic objectives and the criteria for HEIF funding that reflect the teaching elements of KE.

Read about the joint call from Office for Students and Research England.