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(Photograph) - British industry is dipping deeper into its pockets in order to fund research in the old universities.

Government statistics show that industry spent Pounds 131.3 million on research grants and contracts in 1993/94, the latest year for which figures are available. That tops spending in the previous year by Pounds 8.9 million, and represents a 7.2 per cent in cash terms and a 4.8 per cent rise in real terms.

Cambridge received the most cash, Pounds 6.2 million. Nottingham, which came top last year when it accumulated even more industry research money than Cambridge this year, slipped to fourth. Newcomers in the top ten are Southampton and Manchester, at the expense of two Scottish universities, Edinburgh and Heriot-Watt.

Over the past ten years, industry spending has risen by a staggering 116 per cent in real terms as universities have sought sources of income beyond the Government purse. This additional income has been supplemented by the increasing amount of money from endowments and donations, apparently the result of a growing American-style practice of educational philanthropy. In 1993/94, the old universities received Pounds 237.8 million, a real terms increase of 457 per cent. Other income streams have been developed, including residences and catering, which were not even identified as income sectors by the Universities Statistical Register ten years ago.

Universities now make more than Pounds 400 million, although only about Pounds 6 million works out to be actual profit. It is probable that the Government's new figure collecting group, the Higher Education Statistical Agency, which took over the operation of the now defunct USR earlier this year, will define some new industry-oriented categories, as well as collating comprehensive figures for old and new universities.

HESA is to publish its first report next year.