Article

The Higher Education Funding Council for England (HEFCE) announced today that it will make available £7,476 million in funding for universities and colleges in England for 2008-09. This represents a 3.3 per cent increase in total grant over the current year (2007-08).

A table showing individual grant allocations is attached.

Today's announcement provides for:

* an additional 24,000 full-time equivalent students for 2008-09, full-time and part-time (proposals to allocate additional student numbers for 2009-10 and 2010-11 will be announced later in the year)

* an uplift to the funding of teaching (including widening participation) and research

* a continuation of £25 million in additional funding to support very high-cost and vulnerable science subjects (physics, chemistry, chemical engineering, and mineral metallurgy and materials engineering).

Professor David Eastwood, Chief Executive of HEFCE, said: 'This is a good settlement which reflects the Government's recognition of the crucial role played by higher education in securing the country's economic and social well-being and international competitiveness. The funding will provide substantial growth in student numbers and offer greater opportunities to students from a wider variety of backgrounds. These include people in the workplace and those living in parts of the country where there is an under-provision of higher education.

'The funding will also enable us to continue to sustain and develop a dynamic and internationally competitive sector by supporting high quality research. It will enable the growing links between higher education and businesses to flourish encouraging economic regeneration and prosperity through innovation and applied research. It will also foster the wider social roles of universities through public and community engagement.

'One of the most encouraging features of this settlement is the Government's continuing commitment to maintaining the unit of funding over the next three years. This will enable universities and colleges to plan with confidence by offering stability in funding with sufficient resources to encourage dynamism and innovation as they continue to unlock the full potential of higher education in this country.

'The recurrent grant allocations that we are announcing today show variations in outcomes between institutions, reflecting their success in attracting funding for additional student numbers, widening participation and research and the extent to which they have been affected by the implementation of the Government's policy on funding for students aiming for equivalent or lower qualifications (ELQs).'

John Denham, Secretary of State for Innovation, Universities and Skills said: 'The Government is investing more in higher education than ever before with record numbers of students going to university.

'By 2011, funding for higher education will have increased by over 30 per cent in real terms since 1997. This increased investment will ensure that universities and colleges have the resources they need to continue widening participation and reaching out to new talent by working more closely with schools and employers.

'I'm pleased to see funding for more than 20,000 additional student places this year, as well as the continued commitment to strategically important subjects such as science and engineering'.

For further information, contact: Roger Grinyer, tel 0117 931 7307, e-mail r.grinyer@hefce.ac.uk or Philip Walker, tel 0117 931 7363, mobile 07795 257263, e-mail p.walker@hefce.ac.uk

Notes to editors

1. Full details of the recurrent grants and tables showing allocations to individual institutions are given in HEFCE 2008/ <http://www.hefce.ac.uk/pubs/hefce/2005/05_13/> 12, 'Recurrent grants for 2008-09', which will be available on the HEFCE web-site, www.hefce.ac.uk under Publications on Thursday 6 March. These allocations are provisional; final allocations will be announced in July 2008.

2. HEFCE is directly funding 131 higher education institutions and 128 further education colleges for 2008-09. Grants for individual universities and colleges are largely calculated by formula, according to the number of students and the subject mix, and the volume and quality of research.

3. The total funding of £7,476 million available for 2008-09 includes £4,632 million for teaching (of which £364 million is for widening participation), £1,460 million for research, and £120 million for business and community engagement through the Higher Education Innovation Fund (HEIF), which together comprise the £6,212 million funding for recurrent grant available for 2008-09.

4. The funding for research includes:

a. £62 million to support business-related research

b. £185 million to support charity-funded research

c. £199 million to support postgraduate research.

5. The announcement also includes £337 million for special funding representing a reduction of 25 per cent on 2007-08. This decrease is largely the result of transferring the HEIF to formula recurrent funding, which will help to reduce the accountability burden on institutions.

6. £902 million of the total funding announced today will be allocated separately as earmarked capital grants to support teaching and research.

7. None of the increases to universities and colleges take account of the additional fee income in 2008-09 that is expected following the introduction of variable fees for full-time undergraduates from 2006-07.

8. Following the Government's decision to phase out funding for students taking qualifications equivalent to or lower than those they already hold, institutions' individual grants show the changes that result from the implementation of the ELQ policy. This has produced savings of a little under £25 million in 2008-09, releasing funding available for reallocation to institutions for increasing and widening participation.

9. In general each institution's recurrent resource for teaching and research will be at least maintained in cash terms compared with 2007-08.

10. Of the £6,212 million available as recurrent grant for 2008-09, £5,990 million is included in the institutional grant tables in HEFCE 2008/12. The balance of £222 million is due to:

a. £120 million for HEIF. After institutions' strategies associated with this funding have been received and approved, final 2008-09 funding allocations under HEIF will be incorporated into the final recurrent grants published later this year.

b. £102 million set aside as provision largely for teaching funding allocations that are to be finalised later. This includes provision for further growth in 2008-09, and for changes to widening participation allocations to allow for corrections by institutions to their underlying data.

c. London Metropolitan University has not been included in the grant tables because data confirmation has not yet been finished, following a recent audit visit. We are working with the university to finalise this matter.