| 28 February 2007 |  |
| To | Heads of HEFCE-funded higher education institutions Heads of HEFCE-funded further education colleges Heads of universities in Northern Ireland |
| Direct Line | 0117 931 7300 |
| Direct Fax | 0117 931 7203 |
Circular letter number 04/2007
For further information contact HEFCE regional consultants or regional advisers
Dear Vice-Chancellor or Principal
Allocation of funds for additional student numbers in 2008-09
1. This letter sets out our plans for the distribution of funding for additional student numbers (ASNs) for the academic year 2008-09.
2. To date, we have not made significant allocations of ASNs for 2008-09, as this academic year falls within the period of the Government's next Comprehensive Spending Review (CSR). We do not expect to learn the result of the CSR settlement for higher education until late in 2007, and therefore we do not know whether we will have funding available for ASNs.
3. However, we have a number of existing areas of commitment where a failure to allocate growth would put at risk the achievement of our policy objectives. In particular, these objectives include:
- increasing overall levels of participation in higher education
- increasing the number of enrolments in foundation degrees
- developing provision that encourages closer engagement between HE and employers
- increasing provision in subjects that are strategically important to the economy and society, but vulnerable because of relatively low student demand.
4. In parallel with these broad policy aims, we also wish to provide continued support for the large-scale strategic projects at institutions that have received grants from our Strategic Development Fund (SDF). These SDF projects commonly require sustained growth in student numbers to make them viable in the long term and to provide good value for money.
5. Without wanting to anticipate or prejudice the outcomes of the CSR, we have decided that it is essential that we allocate some funding for growth for 2008-09. We have therefore committed existing funding for this purpose.
6. The HEFCE Board has agreed that we should allocate 10,000 full-time equivalent (FTE) ASNs for 2008-09, ensuring that these deliver at least 5,000 additional FTEs in foundation degrees. We will also make available funding to deliver ASNs in conjunction with employers, with the expectation that this funding will deliver 5,000 FTE students - the contribution from employers making up around half the cost of delivery. Where provision is for employee development for a specific employer - at any level, and including foundation degrees - we would expect this to be co-funded.
7. In order to keep complexity and burden to a minimum we will allocate all ASNs for 2008-09 through our strategic growth route - that is, via the SDF. Institutions that have already received ASNs as part of an SDF award are invited to contact their HEFCE regional consultant or regional adviser to discuss their requirements for growth in 2008-09. We will need confirmation of these requirements, following discussion, by 5 April 2007 so that all requests can be considered together by the SDF Panel at its meeting in July 2007. Institutions that are currently preparing an SDF bid should continue to do so, following the standard SDF timescales for bid submission set out on our web-site under Finance and Assurance/Finance and Funding/Strategic Development Fund. The last panel meeting at which ASNs for 2008-09 could be approved will be in December 2007.
8. It should be noted that the numbers available are very limited. We will give priority to projects which can deliver ASNs as foundation degrees and/or through co-financing with employers. We will also take into account institutions' track record in recruiting ASNs.
9. While still following the process outlined above, we would be prepared to consider requests for ASNs to be brought forward and delivered in 2007-08 rather than 2008-09. Institutions interested in this option should discuss the feasibility and timing with their HEFCE regional consultant or regional adviser.
10. Any future funds for growth beyond those set out in this letter are contingent on the outcome of the 2007 CSR and will not be known before late 2007. We will, of course, inform the sector when we know the outcome.
Employer engagement
11. Our strategy for engaging employers with learning at higher education level continues to develop and remains one of our key policy priorities. A separate circular letter (CL 03/2007) provides an update on this area, and clarifies our position on a number of issues, particularly in relation to the allocation of co-funded ASNs.
12. We anticipate that, with guidance, existing structures such as Lifelong Learning Networks and Train to Gain Pathfinders may be in a good position to help us achieve the delivery of 5,000 co-funded FTE ASNs, as outlined above. We would like to encourage the development of co-funded programmes of HE, and invite institutions interested in delivering such programmes to contact their regional consultant or regional adviser to discuss possible opportunities.
Yours sincerely
Professor David Eastwood
Chief Executive