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Under the funding mechanism - the Research Assessment Exercise (RAE) - all but the highest rated university departments have had their funding withdrawn or reduced.
As a result many of the smaller speciality areas have been forced to cut back on academic staff or close departments altogether. In 1997, for instance, there were 12 academic departments of anaesthesia in London. Only three remain in 2005.
In psychiatry, over a quarter of all academic posts in the UK have been cut, and a quarter of posts in academic pathology have also been lost between 2000 and 2003.
Professor Michael Rees, head of the BMA's Medical Academic Committee, said:
"The UK is second only to the US in international medical research output, yet the RAE ranks it 30th in the world.
"The system's rating criteria are biased against medical research - and have left key specialities scrambling to survive. As medical schools cut back on posts to balance their books, we face the disappearance of certain specialities from medicine departments altogether.
"In radiology, for instance, departments have closed in medical schools in London, Liverpool and Leicester, and senior lecturers have been lost in Nottingham, Cardiff, Bristol and Edinburgh. This at a time when the NHS faces a desperate shortage of radiologists.