England funding blueprint

July 5, 1996

A funding system which aims to even out cash imbalances in English higher education was unveiled this week.

More support for universities and colleges offering specialist provision, and those catering efficiently for large numbers of students, is heralded by the Higher Education Funding Council for England's Funding Method for Teaching consultation document.

Those with large numbers of part-time students, mature undergraduates, students with disabilities or from lower socio-economic groups, stand to benefit. Small and highly specialised colleges, further education colleges running higher education courses, and those institutions at the cheaper end of the funding spectrum, will also gain.

But universities offering mainly traditional high-cost programmes could lose out unless they score well on other factors, such as high quality, demand, and national and regional needs.

The scheme, which could start from next year and go into full operation by 1998/99, is designed to iron out rates of funding and introduce changes in the way student numbers are distributed.

Funding: The council proposes to establish four new price groups to help it set standard prices in higher education. They are: clinical medicine, dentistry and veterinary science; laboratory-based courses; part-laboratory based; and mainly classroom based. The council will use institutional financial records to decide on the standard price for each group. Standard prices may be influenced by the following: * Part-time students * Mature students * Students with disabilities * Students from lower socio-economic groups * London institutions * Small specialists, such as performing arts colleges * FE colleges offering higher education courses Institutions will be invited to map their provision on to a notional credit system. The paper suggests: "This will enable full-time and part-time students to be considered and funded together."

The present and new system will be compared and adjustments made over a time, yet to be determined, to bring all within 5 per cent of their new funding level. Where the model shows unit funding should be increased somewhere, this could be done by increasing funds, reducing student numbers, or both.

The system would mean any efficiency gains required of the sector would be applied equally across all institutions rather than differentially according to their average unit of council funding.

The council is also considering rolling formula capital funding into recurrent funding. Money would be divided between teaching and research in a split ranging from 70 per cent for teaching and 30 per cent for research to 78 per cent teaching 22 per cent research.

Student numbers: Institutions can bid for extra student numbers on the grounds of: * High quality - the council would leave it to institutions to bring whatever evidence they can to back their case * Student demand - it would be up to institutions to prove there was a particularly high demand for their courses * National policy - priorities identified by the council * Regional need - particularly in areas poorly served by higher education * Institutional mission and strategy - institutions would have to show how this would be helped by extra numbers.

Bids would be made to six peer review panels. One would cover specialist colleges; four all other higher education institutions, divided into four regional groupings; and a sixth FE colleges.

To allow institutions to plan, the council proposes to invite bids for extra numbers every two or three years, though numbers actually allocated would be reviewed annually in the light of public expenditure settlements.

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