It has been derided by academics for doing little more than bolstering the legions of consultants and administrators on UK campuses, but an £888 million fund to “reward and develop” university staff has been hailed a success by an independent review.

The study, conducted by consultants Oakleigh, found that the hundreds of millions of pounds spent on the scheme since 2001 have dramatically improved universities’ human resources departments.

When the Rewarding and Developing Staff (RDS) fund was launched in 2000 by David Blunkett, who was then Education Secretary, he said it would “support increases in academic and non-academic pay”. In his guidance to the Higher Education Funding Council for England, he said the fund should cover six priority areas, including “addressing recruitment and retention difficulties” and “action to tackle poor performance”.

After three years of the fund, the University and College Union claimed that barely any of the money had gone to staff. It had instead been used to “boost human resources departments”, the union said.

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But the Oakleigh report, which is published today by Hefce, found that the initiative has helped universities to ensure that human resources issues play a key role in strategic planning and boosted salaries.

It also led to a favourable shift in attitudes towards the perceived status and purpose of people management in higher education, the report said.

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Steve Eagan, deputy chief executive of Hefce, said: “This study has identified the impact our initiative has had on HR management within universities and colleges. They can take full credit for responding very positively and making HR an integral part of their strategies by developing effective and modern practices.”

Universities said the funding had allowed the sector to address many underlying issues. They were able to offer leadership training to middle managers and to develop coherent career progression routes for all employees, including contract researchers and “blue-collar staff”.

Paul Curran, chair of Hefce’s higher education workforce steering group, said such investment was all the more important during tough economic times.

“Universities and colleges spend an average of 56 per cent of their income on staff costs,” he said. “It is vital for them to ensure that staffing is as effective and efficient as possible – even more so when money is tight. That calls for high-quality HR management.”

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Sally Hunt, general secretary of the UCU, said the fund’s impact had been inadequate.

“Since 2001, nearly £1 billion has been spent on the RDS initiative. In that time, the gender pay gap for academic staff in UK higher education has not improved – female pay was 18.2 per cent behind male colleagues in 2001 and was still 18.2 per cent [behind] in 2008. Levels of occupational stress in higher education are much higher than national comparators. Meanwhile, in a survey in December 2008, one third of academic and academic-related staff in UK higher education reported having been bullied at work in the previous six months.

“RDS funding has been a bonanza for human resource management consultants, but overall there’s been little real benefit to show for it.

“One of the main areas of spending under the RDS initiative has been on the implementation of the pay Framework Agreement. Improving pay inequality has been one of the main aims of the framework, but to date little has been done to carry out and act on joint equal-pay audits with staff unions despite joint guidelines for such audits being available since 2002.”

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hannah.fearn@tsleducation.com