INCREASED funding for academic research, as promised by the Governor in his policy speech, has fuelled a proposed increase in spending on the University and Polytechnic Grants Committee (UPGC). Funds for the UPGC will increase by 12.7 per cent to $6.38 billion, which will also help pay for the increasing number of first year first degree places for full time students. It is estimated the number of such students will reach 12,520 in the 1993 academic year, an increase of 1,513 places over the current year. The number of full-time students is also expected to increase at the seven institutions the committee funds. Increasing by 3,612 from the 1992 academic year, the number is expected to reach 52,394. Mr Chris Patten announced a 20 per cent yearly boost in real terms to research grants, spending that he described last October as ''seed money''. The Research Grants Council awarded $116 million to Hongkong institutions last academic year. The figure will jump to $147 million for 1993-94 and is expected to top $200 million in real terms in 1994-95. The UPGC has also allocated funds for a major review of the development of tertiary education in the 1994-95 period, which was started last year. The Education Department's spending power next year will be increased by 14 per cent to $13.53 billion - an increase of 5.3 per cent - according to the budget estimates. Six areas of increased spending are: Kindergarten increases of 8.9 per cent to $130.4 million mainly due to more kindergartens being eligible for reimbursement of rent and rates; Primary education up 3.1 per cent to $5.101 billion. Improved class-teacher ratio, reduction in class sizes, more primary schools operating whole-day classes and replacement teachers for those on training all demand the creation of 89 new posts; Secondary education up 6.4 per cent to $7.267 billion. Eleven new posts will be created to cover extra sixth form classes and replacement teachers for those on training; Special education for the disabled up 8.1 per cent to $696.7 million. More classes and boarding places and improved services for students; Post-secondary education up 8.1 per cent to $276.4 million. For upgrading facilities in colleges, intensive English programmes by the Institute of Language in Education and the setting up of an organisation to assess the qualifications of non-graduate teachers; Adult education given a 4.9 per cent increase to $60 million to cover increased demand. Legco's education sector representative, Mr Cheung Man-kwong, said there was some general improvement in spending on education. But he was worried that the increase might not be enough to implement the proposals recommended by the Education Commission Number Five report.