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Executive summary


1. This document summarises our provisional allocations to institutions of recurrent funding for the academic year 2016‑17.

Key points

2. The overall grant we will distribute for the 2016-17 academic year is £3,674 million, comprising:

  • £1,578 million for recurrent research grant
  • £1,360 million for recurrent teaching grant
  • £160 million for knowledge exchange
  • £98 million for national facilities and initiatives
  • £478 million for capital funding.

3. The Board agreed these 2016-17 academic year budgets, assuming that the indicative funding available for the 2017-18 financial year will be confirmed. As usual, any future changes to the grant made available to us by Government could affect the funding we are able to distribute to institutions in the 2016-17 academic year, and this may include revising allocations after they have already been announced. Accordingly, institutions should plan their budgets prudently.

4. We are increasing by £20 million the 2016-17 budget for mainstream quality-related research (QR) and its London weighting to a total of £1,070 million. The other separate streams within recurrent research funding are maintained in cash terms at the same level as for 2015-16.

5. We are maintaining in real terms the total teaching grant budgets for our main high-cost subject allocation and for the targeted allocation for very high-cost STEM subjects (physics; chemistry; chemical engineering; and mineral, metallurgy and materials engineering).

6. We are introducing a stream of funding for a geographically focused national collaborative outreach programme that will target those places where students have the educational attainment or potential to succeed in higher education but where there is evidence that entry rates are below expectations. ‘National collaborative outreach programme: Invitation to submit proposals for funding’ (HEFCE 2016/06), invites proposals from consortia of institutions and others working together to widen access in areas that we have identified.

7. We are doubling the funding to improve provision for disabled students in 2016-17 to £40 million. The increase is to support institutions to meet the rapid rise in the number of students reporting mental health problems and to transition towards an inclusive social model of support for disabled students. The distribution of this funding better reflects the actual numbers of disabled students at each institution by no longer assigning institutions to quartile groups for weighting purposes.

8. We have reviewed allocations to support specialist institutions with world-leading teaching.

9. The amount of recurrent teaching grant continues to decline, predominantly as a result of the continuing phase-out of funding for old-regime students (those students who started their studies before 1 September 2012). The supplement for old‑regime students declines by £54 million from £91 million in 2015-16 to £37 million in 2016-17.

Action required

10. No action is required in response to this document.

Date: 6 May 2016

Ref: HEFCE 2016/09

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