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Dear Vice-Chancellor or Principal

1. The Secretary of State for Business, Innovation and Skills (BIS) wrote to HEFCE on 27 April 2012 providing guidance on student number controls for 2013-14 (see note 1). Through this guidance, BIS has asked us to free more student places from control, and make 5,000 places available through a core and margin exercise.

2. This letter provides initial information about how we intend to do this. Our proposals are subject to HEFCE Board approval in July 2012, following which detailed guidance will be issued to all institutions.

3. We welcome comments on these outline proposals by Friday 1 June 2012.


4. Last year, in ‘Teaching funding and student number controls: Consultation on changes to be implemented in 2012-13’ (HEFCE 2011/20), we consulted on proposals for implementing the reallocation of a margin of up to 20,000 places in 2012-13 to institutions with an average full-time fee of £7,500 or less (net of fee waivers) that could clearly demonstrate an acceptable quality of provision and demand for it.

5. The Government also requested that we no longer place controls on the recruitment of students with very high grades prior to entry to higher education. It defined this group of students as those who achieved grades of AAB, or above, at A-level, or the equivalent of this, and referred to this group as the ‘AAB+ equivalent’ population. In March we published the grade and qualification combinations that we will treat as equivalent to AAB or above at A-level for 2012-13 in guidance that accompanied the 2012-13 recurrent grant announcement in March this year (see note 2). Any other entry qualifications will not exclude a student from the 2012-13 student number control. The equivalents were determined solely for the purpose of operating a student number control, and are not intended to be a comprehensive or exhaustive assessment of students’ prior attainment. In setting the student number control limits for 2012-13, we have ensured that institutions continue to have flexibility to recruit students with high grade entry qualifications that are not included in the list of AAB+ equivalences, for example through providing a minimum core to the most selective institutions that might have otherwise found themselves with a very small core.

6. We created the 20,000 margin for 2012-13 by reducing each institution’s student number control after the reductions for the AAB+ equivalent population had already been applied. We then distributed the places through a competitive bidding process, inviting institutions to submit proposals for student numbers from the margin. Institutions were advised of their allocation from the margin in January 2012.

Proposals for 2013-14

7. For 2013-14 we intend to create and distribute the margin of 5,000 places broadly in line with the method we consulted on in 2011, and implemented for 2012-13. There are several reasons for this:

  • the method is fit-for-purpose in meeting government policy objectives
  • a consistent approach will ensure that institutions have a broad understanding of what will happen with 2013-14 numbers before they submit access agreements to OFFA at the end of May.

Employing a similar approach to the previous exercise will render a full and burdensome consultation process unnecessary. However, comments on the approach are welcome by 1 June; such responses will be considered alongside responses to the HEFCE 2012/04 consultation at our July Board, at which the final decisions on the process will be made.

Creating a margin of 5,000

8. To create a margin of 5,000 student places for reallocation we will take the following steps to reduce each institution’s student number control (the AAB+ population has already been taken out of 2012-13 core numbers). The reductions will reflect:

  1. The number of ABB (see note 3) and equivalent students admitted in 2011-12. We will provide further information about, and invite comment on, the qualification and grade combinations that we will treat as equivalent to ABB+ at A-level for 2013-14. (Our current consultation, HEFCE 2012/04, asks about principles for establishing equivalences, about which we will issue technical guidance after the consultation closes.)
  2. A proportion to account for anticipated annual growth in the ABB+ equivalent population between 2011-12 and 2013-14. The BIS letter referred to in paragraph 1 above asks the Council, ‘to take a cautious approach in making its assessment of the numbers of students in the ABB+ uncontrolled population in 2013-14 and their propensity to attend university’, and we shall do this.  
  3. Protection for the number of non-ABB+ students studying certain strategically important and vulnerable subjects.

9. The first 50 student numbers in an institution’s student number control are protected from these reductions; also we will not make a reduction where an institution’s total student number control is 50 or fewer. This protects very small institutions. We are considering whether, and to what extent, a protected core for the more selective institutions may continue to be needed.

10. The remaining student number control – after taking these reductions into account – represents the ‘core’. From this we will make a pro-rata reduction to create the ‘margin’ of 5,000 places.

11. Specialist institutions were able to opt out of the 2012-13 AAB+ and core/margin processes if they recruited primarily on the basis of audition or portfolio and have more than 60 per cent of their provision in Higher Education Statistics Agency (HESA) cost centres 30 (media studies) and/or 33 (design and creative arts). Institutions which meet the same criteria will again be able to opt out of the 2013-14 ABB+ and core/margin process. Those who choose to opt out will continue to have ABB+ students included in their student number control limits, and will not have their student number control reduced to contribute towards the creation of the 5,000 margin; however, they will not be able to benefit from an allocation from the margin, or recruit unlimited numbers of ABB+ equivalent students. We will have more information for institutions that opt out after the July Board meeting.

Distributing the 5,000 places

12. In line with government advice, we will consider the quality of the provision and the demand for its places, and will allocate the 5,000 numbers in the following way:

  1. The majority of places to institutions that we already fund with an average full-time (FT) fee of less than £7,500 (net of fee waivers) for students commencing in 2013-14.
  2. A sizable minority to institutions that we already fund with an average FT fee of between £7,500 and £8,250 (net of fee waivers) for students commencing in 2013-14.
  3. A minority to institutions that we already fund who commit to using their margin allocation to expand their established franchised partnerships. Higher education institutions with an average full-time fee above £8,250 (net of fee waivers) can be considered for an allocation under this priority area if their franchised provision has an average full-time fee of less than £7,500 (net of fee waivers) and if they commit to using the numbers they are allocated solely to increase this franchised provision accordingly. OFFA will be collecting data about partnerships, and will share these data with HEFCE.
  4. A further minority to providers of HE not currently in receipt of direct HEFCE funding for FT undergraduate (UG) places.

13. We intend to make the allocation of numbers in the first three categories formula-based, on a pro-rata basis because there are too few numbers to justify the burden on institutions or HEFCE of a bidding process.

14. The exception to using a pro rata allocation will be those providers not currently in receipt of HEFCE funding directly for FT UG (d. above) because we would want to treat this group of institutions in the same way as we treated new bidders last year. It is reasonable to expect that these providers should be able to submit a competitive proposal in order to be considered for FT UG HEFCE-fundable student places for 2013-14. No bidder in this category will be allocated more than 50 student numbers, and there will be a minimum allocation of 25 as last year.

15. There will be an appeals process in late January 2013, and a number of places will be set aside for successful appeals.

Monitoring fee levels

16. In promoting student choice, the Government wishes to ensure that students have the opportunity to study at universities and colleges that combine high quality education and excellent value for money.

17. Our guidance on the award of margin places for 2012-13 was clear that we would monitor net fees for undergraduate students commencing their studies in 2012-13 in institutions awarded student places through the core and margin exercise. This monitoring process will be extended to students commencing their studies in 2013-14 in institutions that benefit from margin places from the new exercise. This will allow the Government to take a view on whether or not its policy intention is being realised.

18. Universities and colleges awarded places from the 2012-13 and 2013-14 margins should therefore be aware that significant increases in average net fee levels (after fee waivers) over the next two or three years may result in a downward adjustment of their institutional student number control total from 2014-15 onwards.


19. The Government has requested that we should continue to take fee thresholds into account in allocating these numbers, so we intend to use the average fee information contained in institutions’ access agreements submitted to OFFA in May 2012. We will not make an allocation from the margin to institutions that do not meet the fee thresholds for this exercise.

20. Demand was one of the criteria by which numbers from the 20,000 margin were awarded for 2012-13, so we intend to use the early recruitment data available in the Higher Education Students Early Statistics (HESES) and Higher Education in Further Education: Students (HEIFES) surveys for 2012-13 to see whether these places have been filled. For all institutions, we reserve the right not to offer an allocation to those who do not recruit to at least 95 per cent of their 2012-13 student number control limit (for reasons other than a need to offset over-recruitment that occurred in 2010-11 or 2011-12) or to those who significantly over-recruit.

21. Quality is the second key criterion of the core and margin exercise, so we intend to use Quality Assurance Agency review results and National Student Survey data to ensure that we do not offer a pro rata allocation for 2013‑14 to institutions about which there are obvious quality-related concerns.

22. There will be no requirement on institutions to submit further supporting information or data, because we can use data they will have already submitted. The exceptions to this are providers not currently in receipt of FT UG places who wish to bid for numbers; advice about the format of these bids will be made available in July.


23. We expect the timings of this exercise will be:

Deadline for comments on these outline proposals 1 June 2012
HEFCE Board meeting 12 July 2012
Letter to institutions with final advice, including an invitation to bid to providers without FT UG HEFCE numbers By end July 2012
Deadline for receipt of bids from providers that we do not currently fund directly for FT UG places Early autumn – to be confirmed
HEIFES / HESES 2012 received by HEFCE November / December 2012, respectively
Provisional SNC allocation announced January 2013
Appeals process End January / Early February 2013
Final SNC allocation announced February / March 2013

Further information

24. These are our outline proposals for implementing 2013-14 student number control policy, and need to be approved by the HEFCE Board on 12 July 2012. We will have more information for institutions after that meeting.

25. Your comments on our proposals are welcome, and should be e-mailed to Dave Norman by Friday 1 June 2012.

Yours sincerely


Sir Alan Langlands

Chief Executive


1. The letter and HEFCE advice, and BIS press release.

2. They are specified in paragraph 67 of 'Technical guidance for higher education institutions' on the Annual funding allocations section of the HEFCE web-site under 'For institutions', and in the equivalent document for further education colleges.

3. AAB+ has already been removed from the controlled population.


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Date: 14 May 2012

Ref: Circular letter 12/2012

To: Heads of HEFCE-funded further education colleges, Heads of HEFCE-funded higher education institutions

Of interest to those
responsible for:

Senior management, Planning, Admissions to HE

Enquiries should be directed to:

Dave Norman, tel 0117 931 7095, e-mail