31 August 2004

To	Heads of HEFCE-funded higher education institutions Heads of universities in Northern Ireland

Direct Line	0117 931 7300
Direct Fax	0117 931 7203

Circular letter number 17/2004

For further information contact Ian Lewis, tel 0117 931 7336, e-mail i.lewis@hefce.ac.uk

Dear Vice-Chancellor or Principal

'On the Edge: securing a sustainable future for higher education'

1. Over the last two years HEFCE has been working jointly with the OECD's Institutional Management in Higher Education (IMHE) programme on a project looking at financial management and governance of higher education institutions (HEIs). The project examined the strategic financial management issues affecting higher education in the changing policy and funding environments in eight OECD countries .

2. The outcome of the study is this international report, entitled 'On the Edge: securing a sustainable future for higher education'. The report is aimed both at policy makers and at heads, senior managers and governing bodies of HEIs. It sets out the challenges facing those concerned with the ability of universities and colleges to deliver educational goals in the long-term.

3. The challenge for public policy makers, at a time when public funding is declining as a proportion of the total funding for higher education, is how to ensure that HEIs still deliver governments' aims, without threatening the long-term sustainability of individual institutions.

4. The challenge for HEIs, at a time when the range of activities and funds is becoming more complex and less predictable, is how to position themselves within the various markets in which they operate, and to do so in ways that are consistent with their academic objectives for the long-term.

5. With both these challenges, the focus is on a long-term sustainable future: the ability of universities and colleges to meet their own and society's objectives, not only now but also in the future, and to the necessary standards of excellence. This will involve increased levels of collaboration, and longer-term partnerships between HEIs, their sponsors and their beneficiaries for the benefit of all.

6. I commend the enclosed report to you. It is also available on the OECD IMHE web-site, along with the individual reports on the higher education systems in the eight participating countries, which provided information for the international report.

Yours sincerely

Howard Newby
Chief Executive

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