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The announcement follows the grant letter from the Department for Business, Innovation and Skills to HEFCE of 4 March (Note 1), which sets out the Government’s priorities for higher education for the coming year.

Key elements of funding

The key elements of the £3.7 billion funding are:

Research

£1.6 billion

Teaching

£1.4 billion

Knowledge exchange

£0.2 billion

Capital funding

£0.5 billion

National facilities and initiatives

£0.1 billion (Note 2).

Funding for recurrent research has increased by £20 million compared with 2015-16, while funding for knowledge exchange is maintained in cash terms. Funding for teaching has been reduced by £21 million. Within teaching, the total budget for high-cost subjects such as science, technology, engineering and mathematics will be maintained in real terms.

Widening access

New funding for geographically-focused national outreach will target places where students have the educational attainment or potential to succeed but where there is evidence that entry rates are below expectations (Note 3). The funding for this will be £30 million for 2016-17, rising to £60 million from 2017‑18.

This approach will enable progress towards the Prime Minister’s goal of increasing the participation of disadvantaged and black and ethnic minority students (Note 4).

Support for disabled students

Funding for widening access and improving provision for disabled students will be doubled in 2016-17 to £40 million.

The increase will support institutions better to meet the needs of the rapidly growing number of students with mental health problems as recommended in recent HEFCE research reports (Note 5).

Professor Madeleine Atkins, HEFCE Chief Executive, said: 

‘The HEFCE Board’s decisions on teaching funding address key priorities for Government, students and the wider public. HEFCE’s funding will protect the high-cost subjects which are key to economic growth. We are targeting funding to help meet the Prime Minister’s widening participation goals, and to support institutions more effectively to meet the needs of students with mental health problems.

‘There are challenges ahead for the sector. Teaching grant is expected to reduce in cash terms by £120 million over the spending review period, even as student numbers increase. Our budget decisions for 2016-17 will help institutions prepare for and manage the changes ahead.

‘The increased funding for research enables us to take a small step towards recognising the improved research performance of the sector that was evident in the 2014 Research Excellence Framework outcomes. This increase will be provided through HEFCE’s mainstream quality-related research funding.’

Notes

  1. The Government’s grant letter to HEFCE of 4 March 2016 is available at www.hefce.ac.uk/news/newsarchive/2016/Name,107598,en.html.
  2. Figures in this press release are rounded and therefore the figures in this table do not sum. More precise figures are given in ‘Funding for universities and colleges for 2014-15 to 2016-17: Board decisions’ (HEFCE Circular letter 03/2016).
  3. See www.hefce.ac.uk/analysis/yp/gaps/.
  4. The Prime Minister’s goal is to double the proportion of young people from disadvantaged backgrounds entering higher education by 2020 compared with 2009, including increasing the number of students from black and minority ethnic communities studying in higher education by 20 per cent by 2020.
  5. See York Consulting and University of Leeds, ‘Support for higher education students with Specific Learning Difficulties’, and Institution of Employment Studies, available at ‘Understanding provision for students with mental health problems and intensive support needs’.
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