At intervals of 3-4 years, research quality in English universities has been externally reviewed 5 times over the past 16 years. Assessment is based on peer-review of material submitted by universities to 70 separate subject panels. The principal component is information on research output, usually publications, from all academic staff identified as "research active". Research quality is rated on a numerical (1-5*), criteria-based scale. Ratings in all subject areas and across all universities have increased to give an average rating in 2001 corresponding to a level of "attainable national excellence". Between universities there are significant variations. In the prestigious Loxbridge group, where almost all academic staff are research-active, 90% of subject areas achieved ratings at level 5 in 2001; in contrast, in the New universities, where only 40% of academic staff is research-active, level 5 was achieved in 7% of subject areas. A combination of high research quality and high cost research (medicine, science, engineering) concentrated in the Old universities is similary evident in the distribution of research funding. Income from both research subsidy and research grants and contracts is divided: Old universities, 94% (Loxbridge, 35%), New universities, 6%. High institutional costs of the assessment process, particularly for areas of low-cost research, and increasing concern about the inadequacies of the rating system and failure of its direct link to funding suggest that substantial revision will be needed for future assessment exercises.