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  • Executive summary
  • Background: the funding agreement
  • Implications of 2011-12 grant adjustments on funding in 2012-13
  • Funding conditional upon delivery of growth
  • The medical and dental CFTE
  • The contract range
  • Institutions above their contract range
  • Institutions below their contract range
  • Consolidated 2010-11 contract range holdback recoverable in 2011-12
  • The student number control
  • Moderation
  • Monitoring ASNs for co-funded employer engagement
  • Funding for widening participation and other targeted allocations
  • Other conditions of recurrent grant
  • Conditions of recurrent grant relating to tuition fees and access agreements
  • Institutions with no HEFCE-fundable students
  • Verification
  • Data audit and reconciliation
  • List of abbreviations

Executive summary


1. We have a funding agreement with each institution that we fund, which specifies targets relating to student numbers. This document explains what action we will take if institutions do not meet their targets for 2011-12.

Key points

2. Within our funding agreements with institutions, we specify four targets that apply to student numbers funded through our mainstream teaching funding, although these targets will not all apply to every institution. They are:

  1. The contract range. Under our funding method for teaching, we calculate a standard level of resource for each institution, and an assumed resource (actual HEFCE teaching grant plus an assumption of income from fees). The percentage difference between assumed and standard resource for the academic year 2011-12 should be within a given range – known as the 'contract range'.
  2. The student number control. Our allocations for 2011-12 make provision for student numbers to be consistent with the Government's plans. To help manage the risk of over-recruitment, we have specified a limit for each institution of HEFCE-fundable and employer co-funded students starting full-time (FT) undergraduate (UG) and Postgraduate/Professional Graduate Certificate in Education (PGCE) study in academic year 2011-12. Institutions recruiting above this limit will incur a reduction in grant.
  3. Funding conditional upon delivery of growth. This applies to institutions that are expected to increase student numbers in 2011-12, as a result of being awarded mainstream additional student numbers (ASNs). Funding for those places is contingent upon institutions actually recruiting additional students to fill the places.
  4. The contract full-time equivalent (CFTE). This is a minimum number for students on UG medical and dental courses to which a quota applies.

3. These measures are designed, respectively:

  1. To maintain broadly comparable resource levels per student so that the quality of the student experience is not put at risk.
  2. To reduce the risk of HEFCE's grant being reduced by Government in order to meet unplanned student support costs.
  3. To ensure that funds allocated for expansion do indeed deliver additional places.
  4. To ensure that the intended number of medical and dental students required to meet national needs is delivered, in return for the exceptionally high level of funding provided for such students.

4. To achieve these objectives we will withhold grant from an institution which meets one or more of the following criteria:

  1. The institution is found to have a level of assumed resource which takes it above its contract range.
  2. The institution exceeds its permitted level of HEFCE-fundable and co-funded students starting FT UG or PGCE study in the academic year 2011-12 (the student number control).
  3. The institution does not deliver the growth expected in 2011-12 arising from an award of mainstream ASNs.
  4. The institution under-recruits against its CFTE target for medicine and dentistry.

5. In addition to the targets and monitoring arrangements that apply to our mainstream teaching grant, we also fund some student numbers outside our mainstream teaching allocations. These include allocations for co-funded employer engagement. These allocations are subject to separate arrangements for monitoring and grant adjustments.

6. In relation to paragraphs 4-5, before taking any action we will give institutions an opportunity to tell us about any material changes in definitions or mitigating factors that may have influenced the calculated level of grant adjustment.

7. We allocated £4 million in 2010-11 to support institutions that are shifting the balance of their provision towards strategically important and vulnerable subjects. We invited bids for this initiative in 'Support for moving full-time undergraduate numbers into strategically important and vulnerable subjects (SIVS) in 2010-11' (HEFCE Circular letter 06/2010). For 2011-12 we are providing a further allocation under this initiative, which will enable institutions that were successful in their bids to maintain their intakes in these subjects at the higher levels they planned for 2010-11. The subjects in question are certain science, technology, engineering and mathematics subjects and modern foreign languages. We reserve the right to withdraw funds in the event that the proposed recruitment does not occur.

8. If an institution does not recruit any students in 2011-12 then all funding for teaching allocated for 2011-12 will be held back.

Action required

9. No response is required.

Date: 1 July 2011

Ref: HEFCE 2011/21

To: Heads of HEFCE-funded further education colleges, Heads of HEFCE-funded higher education institutions, Heads of universities in Northern Ireland

Of interest to those
responsible for:

Finance, Student data, Planning

Enquiries should be directed to:

By e-mail to or to HEFCE higher education policy advisers