Extra government investment is needed to retain the quality of research in the UK, a committee of MPs has warned.

In its report published on Thursday, the science and technology committee found that many of the powers regarding the allocation of funds lay with the Research Assessment Exercise, an unelected body.

The committee calls on education minister Margaret Hodge to take back some of that control.

"The RAE and the funding decisions based on it have major repercussions for the higher education system. We find it hard to believe that the minister is prepared to delegate all of that power to an unelected quango. It cannot be in the public interest that she should do so," said the report.

While the RAE has shown improvements in university performance, the MPs claimed that it distracts staff from their research.

"It also stands accused of distorting research practice, ruining academic careers and contributing to the closure of university departments."

Dr Ian Gibson, chairman of the committee and Labour MP for Norwich North, said that while British scientists remained the best in the world, "world-class reearch cannot be maintained on bargain-basement funding."

The government has allocated an extra £30million for 2002-3, but the report found that this is "far short" of the required funds of £206million.

"The government has already demonstrated its commitment to investment in research with the £1.75billion made available for infrastructure, in partnership with the Wellcome Trust, in the last two spending reviews," a spokesman at the department for education said.