Tuesday 23 December
Decisions on the funding of teaching and research
At its meeting on 18 December the HEFCE Board considered responses to the consultations on the future funding of teaching, research, and postgraduate research programmes (HEFCE 2003/23, 2003/38 and 2003/42). In the light of those responses it made a number of decisions, which are given below. As the grant letter from the Secretary of State had not been received, the Board was unable to announce the level of funding. We hope to be able to do this early in the New Year.
Funding method for teaching
1 The Board agreed in principle that we should move towards a system for funding teaching that is informed by costs. The current method is based on expenditure reported by institutions in different subject areas.
2 The consultation revealed support for an alternative way of determining subject weightings based on full economic costs using the Transparent Approach to Costing (TRAC) method. This would enable universities and colleges to make informed decisions based on actual costs. The TRAC methodology has already been used to report the full economic costs of research at institutional level, and is being developed to estimate the full economic costs of research projects.
3 The Board acknowledged that it would take at least three years to complete a TRAC-based study to identify the full economic costs of teaching in different subjects, and agreed that such a study should begin. This would need to be followed by a full consultation with the sector before any new system could be implemented.
4 In the light of these decisions the Board agreed that the current method should continue in its present form for at least three years, keeping any changes to a minimum. However, the Board concluded that some changes were necessary to reflect the most recent information from universities and colleges and the responses to the consultation.
Price groups
5 The Board agreed the following in relation to price groups, which will affect funding in 2004-05:
- There will continue to be four price groups - A,B,C and D - and price group B will not be split.
- Media studies will continue to be funded within price groups B, C and D, pending a review of the full economic cost of different types of media courses to inform funding in 2005-06.
- Similarly, sports science will continue to be funded within price groups C and D, pending a review of the full economic cost of different types of courses to inform funding in 2005-06.
- Psychology will be funded entirely within price group C, as proposed in the consultation.
- Computer software engineering will be funded entirely within price group C, as proposed in the consultation. The criteria for assigning activity to computer software engineering and electrical, electronic and computer engineering will be reviewed.
- All sandwich year-out students will be funded as price group C.
6 Taking account of changes arising from the consultation, the base price for price group D (classroom-based subjects) is expected to rise by 20 per cent, to around £3,400 per full-time equivalent student. Weightings for the four price groups in 2004-05 will be:
| Price group | Weighting |
|---|---|
| A | 4 |
| B | 1.7 |
| C | 1.3 |
| D | 1 |
Fee assumptions
7 In the light of the consultation, the Board agreed the following on assumed fee levels for 2004-05:
- Assumed fees per part-time undergraduate will match those for full-time undergraduates.
- Assumed fees for full-time postgraduate taught students will be increased to a level not exceeding the base price; for part-time postgraduate taught students they will be increased to a level not exceeding the base price plus 10 per cent.
Premiums for part-time and foundation degree students
8 Premiums will be introduced for all part-time students and all students on foundation degrees. In both cases these will be calculated as 10 per cent of the unweighted full-time equivalent.
Implementation
9 Where institutions move outside the tolerance band (plus or minus 5 per cent), in the first instance movement back into the band will be achieved by reviewing the size of institutional premiums, where institutions are eligible. Any further migration, for those above the band, will be achieved in the first instance by increases in student numbers over an agreed period. For those below the band it will be achieved by additional funding phased over three years.
10 Full details of these and other funding decisions arising from the responses to the consultation will be available early in the New Year.
Funding method for research
11 Following our consultations on research funding (HEFCE 2003/38) and on improving standards in postgraduate research degree programmes (HEFCE 2003/23) the HEFCE Board has made the following decisions:
- The formula for allocating the additional resources to the very best 5* research departments will be modified. In 2003-04 we distributed these extra resources to departments showing sustained excellence through a rating of 5* in both the 1996 and 2001 RAEs. In 2004-05, as well as the 'double 5 stars', we will include departments that were rated 5* for the first time in 2001, if they achieved this without a reduction in the number of research active staff submitted. In order to maintain stability between years, no HEI will receive less than its allocation for the 'very best 5*' in 2003-04. (See also EP 09/2003.)
- Funding for research capability will continue until the next Research Assessment Exercise (RAE).
- Additional capital funding of £8 million per annum for the years 2004-05 and 2005-06 will be allocated as part of the Science Research Investment Fund (SRIF) to the four institutions with the highest SRIF allocations.
- Funding for promising research fellowships of £5 million per annum for the years 2004-05 and 2005-06 will be mainstreamed and added to the funds for Rewarding and Developing Staff.
12 The Board also agreed, in principle, the following:
- to consolidate existing funding for postgraduate researchers through a single funding stream from 2005-06
- to work with the Quality Assurance Agency (QAA) with a view to implementing minimum standards for postgraduate research degree programmes as part of the QAA code of practice
- to continue work on revising the research funding formula and subject cost weights, for implementation after the next RAE, in close consultation with other research funders including charities and the Research Councils.
13 The Board agreed to review the levels of funding for research departments rated 5*, 5 and 4 at its January meeting, following receipt of the grant letter from the Secretary of State.