14 December 2004
EP 06/2004
Grant funding and student numbers for the next three years
The Secretary of State for Education and Skills has announced funding and student numbers for higher education for 2005-06 to 2007-08. The information is contained in the annual grant letter to David Young, Chairman of the HEFCE. We welcome the strategic focus of this letter.
The letter gives us and universities and colleges greater transparency and certainty by providing information on funding and student numbers over the next three years. We particularly welcome confirmation of the Government's commitment to maintaining the real-terms student funding per head, and to increasing participation in higher education towards the 50 per cent target. This commitment is reflected in the increases in funding over the three-year period to support growth in the number of students resulting from demographic change.
We also welcome confirmation of the increases in funding for research announced in the Government's 'Investment Framework for Science and Innovation 2004-2014'. DfES funding for research (both recurrent and capital) will increase from £1.3 billion in 2004-05 to £1.7 billion in 2007-08, an increase of over 30 per cent in real terms. In addition we welcome the continued capital funding for teaching, which increases to over £450 million a year from 2006-07.
Total public funding for HEIs will increase from £6,186 million in the 2005-06 financial year to £6,874 million in the 2007-08 financial year (excluding Access and Hardship funding and the costs of capital and depreciation). This represents a cash increase of £688 million, or 11 per cent.
We will continue to work with the Higher Education Regulation Review Group in delivering a lighter accountability regime, building on the recent achievements in reducing bureaucracy.
We also confirm our commitment to keep our own operating costs to the minimum. These will fall, as a percentage of total grants, from 0.30 per cent in 2004-05 to 0.24 per cent (£16.7 million) by 2007-08.
We welcome the proposal to support the development of research-informed teaching in less research-intensive institutions, with funding of £25 million over the next three years.
The grant letter will be considered at the HEFCE Board meeting on 16 December after which we will make a further announcement.