English universities will face significant funding cuts in the next two financial years, the government has announced. But research spending has once again been preserved.
Institutions will lose an extra £125 million from their funding in 2014‒2015, the government’s Department for Business, Innovation and Skills (BIS) announced in its annual grant letter sent to the Higher Education Funding Council for England (HEFCE), published on 10 February. The figures also show that funding in 2015‒2016 will fall by a further £100 million, from £4.1 billion in 2014‒2015 to £4.0 billion.
BIS said the cuts were necessary “in the context of stretched public finances”. The biggest drop will come in the teaching grant, which will fall by £45 million in 2014‒2015 compared with spending plans outlined this time last year, and by another £246 million in 2015‒2016. A £37 million hardship scheme to help fund the poorest students has also been scrapped and merged into other streams.
Universities’ core funding for research will be maintained at £1.57 billion for the coming two years, the same as in 2013‒2014. Research avoided cuts mooted in an internal memo leaked from the department last year, but science advocates are likely to remain concerned about the effects of inflation on the static budget. The government will also maintain the £113-million Higher Education Innovation Fund, which promotes knowledge transfer beyond academia.
The letter does not dictate exactly how HEFCE should spend its budget, but does lay out government priorities. BIS says that the council should deliver savings “in ways that protect as far as possible high-cost subjects (including science, technology, engineering and mathematics), widening participation and small and specialist institutions”.
Capital spending — cut drastically in the 2010 spending review — will see a boost, including a £200-million competitive scheme to fund science teaching facilities, announced in September. Research will also receive an extra £17 million in capital in 2015‒2016, the documents show.
The letter calls for greater efficiency within higher education, specifically highlighting concerns about pay at the highest levels. “We are very concerned about the substantial upward drift of salaries of some top management. We want to see leaders in the sector exercise much greater restraint as part of continuing to hold down increases in pay generally,” it reads.
Within quality-related (QR) research funding, the letter says the sector must continue in its goal to make £238 million of “savings” over the period 2011‒2015, which is being put back into research. This includes more collaboration, sharing equipment and reducing “regulatory and bureaucratic burden”, it says. Ministers have also asked former chair of Research Councils UK, Sir Ian Diamond, to carry out a review of efficiency in higher education — his second such review in three years.
In a statement, Sir Christopher Snowden, vice-chancellor of the University of Surrey and president of the vice-chancellor’s group Universities UK, said the body was pleased that areas were being protected, but added that it failed to see how the projected cuts could be delivered without reducing allocations in those areas.
On 10 February, the government also announced the funding allocations for the UK’s seven research councils for 2015‒2016. The document confirms a pledge, made in June last year, to maintain the UK science budget (which includes research funding for the arts, humanities and social sciences) and increase science infrastructure spending to £1.1 billion in 2015‒2016.
The “ring-fenced” science budget, which ministers have promised not to dip into for non-science purposes, sees a rise of £115 million to £4.7 billion in 2015‒2016. The Campaign for Science and Engineering, which welcomed the news, put this down mainly to the inclusion of the £79-million “International programme and Emerging Powers Fund”, for which funding is transferring to BIS from the Department for International Development, as well as a £51-million boost for the research councils.