Proposed changes to postgraduate funding in England have been altered in the wake of strong sector opposition - but critics say the funding council's alternative proposal will still see cash further concentrated in pre-1992 universities.

More than ?200 million of Research Degree Programme funding, intended to subsidise the supervision of postgraduate research students, is currently distributed annually by the Higher Education Funding Council for England on the basis of student numbers.

But in response to a call from the government to fund postgraduate training "selectively" on the basis of "only internationally excellent research", Hefce proposed a new funding formula for 2012-13 based on the ratio of a department's 4* to 3* research in the 2008 research assessment exercise.

However, many of the 107 respondents to the funding council's consultation exercise, which closed in June, raised "profound concerns" about the proposal, including the fact that it took no account of how large a proportion of a department's research was rated 3* or 4* out of the total research.

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Subject to final confirmation at the end of the year, RDP funding will now be distributed according to the ratio of a department's 3* and 4* research combined to the total amount of research rated 2* and above.

Alan White, director of the graduate school at the University of East London, welcomed Hefce's decision to abandon a further proposal to end funding where the ratio between a department's RDP grant and its quality-related research funding exceeded a certain unspecified level.

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But he criticised the funding council's "reluctance to let go of its assertion that quality of research output can be used as a proxy for quality of research supervision".

Dr White said the new formula would still see the further concentration of RDP funding in pre-1992 universities, and argued it would be better to allocate it based on the postgraduate research element of institutional reviews carried out by the Quality Assurance Agency.

But he was pleased that "turbulence" would be minimised by Hefce's decision to cap any increases on a department's current funding levels at 30 per cent in 2012-13.

Hefce said this was partly in response to respondents' scepticism that supervision costs were higher in better-rated departments.

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However, Wendy Piatt, director general of the Russell Group of large research-intensive universities, said the cap could "inhibit the ambitions of the very best universities, and appears to conflict with the government's intentions to differentiate between, and reward, higher- quality research environments".

"In a time of very limited resources, funding should focus on those institutions most capable of delivering excellence and of maintaining the UK's place as a global leader in higher education," she said.

But she welcomed Hefce's confirmation of its decision to top up the RDP funding pot with the ?35 million freed up by no longer taking 2* research into account in the allocation of quality-related funding.

Les Ebdon, chair of the Million+ group of post-92 universities, said this would "further retrench historic patterns of funding and privilege".

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paul.jump@tsleducation.com.