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HEFCE press release

5 November 1997

Advice to the DfEE on the future of college fee funding for Oxford and Cambridge Universities

The Board of the HEFCE today confirmed its support for excellence in teaching and research and agreed that it should do nothing to damage the special character and world class standing of education at Oxford and Cambridge Universities.

The Government has asked for advice from the Board on the issue of the college fees for the two universities to be given in confidence.

In a wide ranging discussion the Board considered a number of options, from maintaining the present system, to replacing college fee income with grant to the universities. If the option chosen led to a reduction in funding, the Council would want to avoid damage to the quality of college teaching and research.

The Council also signalled that it would wish to consider, as one of its new initiatives, introducing a premium for teaching quality. This would be applied across the higher education sector in England, benefiting the two universities and other institutions offering excellent provision.

The Council will provide advice to Government in the form of a commentary on a range of options.

Ends

For further information contact Roger Grinyer or Philip Walker on 0117 931 7339.

Notes for Editors

1. On 4 August 1997 the DfEE wrote to the HEFCE asking for advice on the future of fees for the colleges of Oxford and Cambridge Universities.

2. Under mandatory awards legislation, the colleges may charge a fee for students through local education authorities, in addition to the normal tuition fees paid to the university. Total fee income in the 1997-98 academic year (AY) is £32.5 million to Oxford and £28.2 million to Cambridge.

3. Some teaching and administrative activities undertaken by the colleges of Oxford and Cambridge would be undertaken centrally at other universities. To avoid double-funding, the HEFCE deducts an amount from the universities’ recurrent grants, which reflects expenditure by the colleges on such activities. The proportion of fee income deducted from grant is 43 per cent for Oxford and 40 per cent for Cambridge. Net college fee income in the 1997-98 AY is £18.5 million to Oxford and £16.9 million to Cambridge.

4. In requesting advice, the DfEE asked how the Council’s new funding method for teaching might be applied to these universities and colleges. The principles underlying the method are:

• institutions must be open and accountable in the use of public funds
  
• similar provision should attract similar levels of funding
  
• any premium funding should be applied in a way that is transparent and justifiable
  
• where funds are allocated selectively, this must be against agreed criteria and according to merit.

5. The DfEE also referred to a recommendation by the Dearing Committee (Recommendation 74), which suggests that variations in the level of public funding for teaching, outside modest margins, should occur only where:

• there is an approved difference in the provision;
• or society (through the Secretary of State or his or her agent) concludes that an exceptionally high level of funding represents a good use of resources in relation to other funding needs in higher education.

The Dearing report noted that college fees represent a substantial addition to the standard funding for higher education institutions, and suggested that the Government review them against these two principles.

HEFCE 7/97

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