So ends 1996. Four years of hard work yielded a welcome Christmas present for many in terms of improved research assessments. Months of campaigning and lobbying produced a little more cash for universities and colleges in the Budget than had previously been planned but nothing extra for science.

Nearly as many months of stating an overwhelmingly strong case failed to produce agreement on better pay for any grades of staff. A modus vivendi was finally reached on setting up a quality assessment agency for higher education and the task of turning plans into reality passed to the newly appointed chairman, Christopher Kenyon: a name to note for the coming year.

What can be said of the state of higher education as the year ends? Britain has a habit of criticism and self-deprecation. This saves us from hubris but puts us at risk of self-denigration. Since universities are the hub of critical habits, academic values requiring people to be rigorous in their judgements, universities are particularly vulnerable to damage of this kind. A financial scandal here, a shoddy franchise there, allegations that staff are bullied, bad supervision of a PhD, whistle-blowing on soft assessment of courses, an unfavourable assessment report, all can give an impression of failure. All are more plausibly seen as evidence of a healthy and open system extruding the venal or incompetent.

This is not to argue for complacency: it is to get over two messages. One is to United Kingdom politicians. The system is not broken (though it is broke) and you do not need to meddle. It is quite evident from the research assessments that given objectives and the freedom to manage their own affairs, universities are good at sorting themselves out even if doing so causes grizzling. Goldsmiths' greatly improved performance, for example, is testimony to the effect of tougher management. Exeter's slippage suggests lack of management which will doubtless be addressed promptly.

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The other message is to would-be customers and collaborators round the world. Do not be deceived by UK higher education's habit of self-criticism into thinking that it is in decline. It is not. At considerable cost, especially in staff time, British higher education is now able openly to demonstrate its quality department by department across the system.

Teaching assessments (where they have been made) show that with rare exceptions the quality of teaching is good. Research assessments, where there is now a basis for comparison over a decade, show that more research is being done and that it is getting better. Student numbers show that despite a freeze on full-time undergraduate numbers, demand for higher education continues to rise with part-timers and postgraduates, most of whom pay for the privilege, pushing overall enrolments up 10 per cent last year. Increasingly hard-hitting reports from the ³ÉÈËVRÊÓƵ Quality Council, higher education's own quality arm, show that the academic community itself is now prepared to haul over the coals those whose standards threaten overall reputations.

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It is a huge achievement and it is the result of much harder work by staff. The trouble, the great big trouble as the year ends, is that staff, with the exception of a few star studded professors whose salaries are individually negotiated, have not been compensated by better pay. What spare money there was went either to those professors and/or to extra research staff to back RAE bids.

The number of academic staff on fixed term research only contracts has nearly doubled since 1992. This accounts for the oddity in the RAE that the number of staff assessed is up compared to last time even though many institutions have put in lower proportions of their people.

Pay means money and it is money - where to get it and how to share it - which will be the central issue for 1997. Ron Johnston (this page) shows how highly complicated an issue it will be. And already, as the year ends, some of those with the strongest research performances (page 1) have started log rolling designed to get themselves a larger share of such money as there is.