The whole matter of university funding, including student fees, is under consideration in a review launched by the previous Government.

It now falls to new universities minister David Willetts to decide the future level of the public financing of academia.

Carrying out commercially-exploitable research and knowledge-transfer projects will, therefore become even more vital as an income-generator for the likes of the University of Bradford, which has successful working links with more than 200 firms and organisations Income from knowledge-transfer projects is already approaching £20m.

The university’s vice-chancellor, Professor Mark Cleary, says delivering world-class applied research and knowledge transfer is a priority, with ambitious targets to reach by 2014.

He said: “For a university like Bradford, the way in which we work with businesses is very important for our future development and sustainability.

“This work is very varied, ranging from engineers and life scientists developing products and programmes with major companies such as Ford or Smith & Nephew, to the work of social scientists in developing training programmes with groups such as the Foreign and Commonwealth Office or the China Development Bank.

“Such work, built on the strength of our research, helps enormously in building our reputation for Making Knowledge Work (the university’s motto).

“We are proud of our business partnerships and hope to see them grow in the coming years. Knowledge-transfer work is key to the university’s success and strategic vision.”

Following the credit crunch, leaner times have already changed the way the university operates, including a voluntary redundancy programme and reorganisation to meet a reduced student intake.

Draconian public spending cuts to tackle the deficit will create even tougher challenges.

According to Professor Phil Coates, pro vice-chancellor for research and knowledge transfer, enhancing its reputation as a centre for applied research is essential to securing the university’s future.

He is overseeing the introduction of a series of interlinked Research & Knowledge Transfer (RKT) centres to combine its research strengths with national and international priority areas, as a key part of its future strategy.

Professor Coates said: “We have world-class research in several areas and collaborations with a wide range of universities, companies and organisations worldwide.

“Key research strengths are in healthcare technologies, advanced materials, digital technologies, applied social research and sustainable living.

“The university has a strong research culture, with more than 80 per cent of our output in the last UK Research Assessment Exercise being rated as at least international quality. Around 60 per cent of our academic staff were entered in the exercise. We are ranked in the top 50 UK universities for our research funding.”

Professor Coates sees the ‘cluster’ approach through the RKT centres as a bold but necessary move by the university.

The RKTs range from the Polymer Interdisciplinary Research Centre – a world-class research laboratory for advanced polymers – which has been operating for more than 30 years, to more recent developments such as the centre for visual computing and the centre for skin sciences.

In the area of knowledge transfer, the university has collaborated with many regional, national and international companies and organisations. These include Arup, British Aerospace, BASF, China Development Bank, Cummins, Dow, Nampak, the NHS, Stiefel, Surgical Innovations, the United Nations, Rotary International and Yorkshire Cancer.

The university recently held its first knowledge transfer excellence awards.

Winners included Professor Hassan Ugail, from the School of Computing, Informatics and Media, who received the vice-chancellor’s award for his patent development and the formation last year of a spin-out company, Tangentix Ltd. The company is developing technology to provide 3D computer games on demand.

Tangentix is developing a commercial product for handling 3D graphic models based on new technology developed by a team at the university led by Professor Ugail. This has the potential to improve and enhance the graphics of video games and movies and to change the way they are used in consumer electronics.

Potential markets range from game production and distribution to the silicon devices used in computers and consoles.

The aim is to develop a ‘bank’ of high-quality 3D graphics on a central server which overcome bandwidth restrictions and maintain picture quality for downloading on demand by subscribers. The firm now wants to hire a high-profile chief executive.

Also recognised was Cogwork Studios, a new venture established by Robert McCarthy and Simon Havil, who both graduated in 2005 and have since gained experience in the computer games field.

Their new business, which is based at the university, designs apps for iPhones and mobile phones. Cogwork Studios is also working on contracts for iPhone games design, translation services and providing quality assurance for a range of mobile phone handsets.

New-product development uses current students and provides them with valuable hands-on experience.

The pair are taking advantage of local support, such as Bradford Kickstart, the chamber of commerce and mentoring from David Robertson-Brown of the Bradford Gumption Centre.

Research led by Professor Anant Paradkar, of the Institute of Pharmaceutical Innovation, Life Sciences, in collaboration with Whitby-based Nature’s Laboratory, which supplies natural health products, clinched the business innovation award.

Andrew Day, from the School of Engineering, Design and Technology, received a special award for his long-standing record of knowledge-transfer activity with many businesses, notably Ford, BP, Gates Corporation and, more recently, BAE Systems and Tata Motors.