Key decisions for the provisional distribution of funding following the meeting of HEFCE's Board in January.

HEFCE announces funding for universities and colleges in 2010-11

HEFCE announced today the main decisions made by the Board at its meeting on 28 January on the provisional distribution of funding to universities and colleges in 2010-11. These decisions were taken in the light of the Secretary of State's grant letter of 22 December 2009. The detailed approach taken by the Board and the decisions are contained in HEFCE Circular letter 02/2010 (attached)

The Board agreed the allocation of £7,356 million for the 2010-11 academic year covering teaching, research, capital and related activities. The grants to individual institutions will be decided by the Board at its meeting on 4 March, and the full grant announcement will be published on 18 March.

The main decisions made by the Board were:

. £4,727 million recurrent funding for teaching. This represents an increase of 0.4 per cent in cash terms or a decrease of 1.6 per cent in real terms, compared with 2009-10.

. £1,603 million recurrent funding for research. This represents a £32 million or 2 per cent increase in cash terms (maintained in real terms) on the £1,571 million allocated for the 2009-10 academic year.

. £562 million in capital funding, which represents a 14.9 per cent reduction in cash terms on the 2009-10 allocation.

. £294 million in special funding for national programmes and initiatives. This represents a 7 per cent reduction in cash terms on 2009-10.

. £150 million for the Higher Education Innovation Fund (HEIF), which compares with £134 million in 2009-10. This represents an 11.9 per cent increase.

Sir Alan Langlands, Chief Executive of HEFCE, said: 'This is a challenging financial settlement, but we are doing all that we can to support excellence in teaching and research by keeping across-the-board reductions in core funding to universities and colleges to a minimum. Our approach will also give institutions maximum flexibility to pursue their priorities.

'In addition we will maintain our commitment to widening participation and to strategically important subjects in science, technology, engineering and mathematics. We will continue to support excellent research across a wide range of disciplines, and build on the success of HEIF to forge even stronger relationships with industry and other public and third sector partners.

'These are testing times but higher education has benefited from very substantial growth over the past 10 years, and we should continue to aim for the very best within available resources. UK higher education generates nearly £60 billion for the economy with a multiplier effect of 3:1 from public investment. It clearly makes sense for the Government to take full account of this in setting priorities for the effective use of public funding in future spending rounds.'