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What can we fund at colleges?

We can fund higher education (HE) in publicly funded FECs and sixth-form colleges, and institutions maintained or assisted by a local education authority. These powers are set out in the Further and Higher Education Act 1992

We can only provide funding to HE courses in colleges, which are known as ‘prescribed courses’ (see below). These are courses that lead to qualifications set out in the legislation. We cannot provide funding for individual HE modules at colleges.

We do not fund non-prescribed HE courses at colleges, which may be funded by the Skills Funding Agency or through another source.

How do we allocate funds?

We calculate teaching funding by using a formula. This takes into account the ‘price group’ of a qualification as set out by the Skills Funding Agency. The price groups bring together different courses according to how costly they are for the college to deliver.

‘High cost’ qualifications will receive more funding. But these funds do not cover the total cost of delivering the course. The remaining costs come from fees which the college charges its students.

The annual funding we allocate to colleges for teaching takes the form of ‘recurrent funding’. This means that we use data which colleges return to us about the details of their students and courses to inform and revise our funding allocations. With each data return we revise our calculations. 

Teaching funding allocations are based on data returns for the previous year. 

Colleges may also receive ‘targeted allocations’. For 2017-18, there have been a number of changes to our targeted allocations:

We discontinued the widening access targeted allocations, and instead increased the funding available to the national collaborative outreach programme to £60 million.

We have provided student premiums for full- and part-time students to support successful student outcomes. These replace the precious allocations for improving retention and incorporate the previously separate allocation for part-time undergraduates.

We also provide targeted allocations for the extra costs of part-time undergraduates, for some accelerated courses, and for colleges based in London. 

Further information

Page last updated 14 June 2017