Give us Pounds 5 billion and we'll give back more

The CVCP aims to persuade the government that higher education is vital to wealth creation and social inclusion. Tony Tysome reports

Vice-chancellors conjured scenes from Oliver Twist last week, when they took their funding bowl back to the government to ask for Pounds 5 billion more.

Their arguments supporting the bid for extra cash, contained in their submission to the comprehensive spending review for the next three years (CSR2000), suggested that many universities are already in the workhouse. It cited recent funding council figures that show a third of English universities have forecast deficits, with an overall Pounds 250 million a year shortfall signalling a "worrying decline in the sector's operating position over the CSR2000 period".

But the Committee of Vice-Chancellors and Principals says it is coming to the government with more than a bold beg. Its 26-page submission attempts to demonstrate what the British economy and society stand to gain from what would be in real terms a 10 per cent increase in higher education funding.

The CVCP's central argument is that higher education "is now rightly regarded as crucial to wealth creation and universities as vital partners in the development of a knowledge-based economy". Universities also "have a key role to play in the drive for a fairer, more inclusive society".

Universities can make a significant contribution to achieving the government's goals for improved employability, flexibility in changing markets, technology transfer, and entrepreneurship, the submission paper says.

They also have "major advantages" in the global market for higher education, with a reputation for quality combined with the emergence of English as a universal academic language. Universities could help fulfil prime minister Tony Blair's vision of them as "wealth creators in their own right" by tapping into demand from international students, whose numbers are expected to rise from 1.75 million worldwide next year to 2.7 million by 2010.

Value for public money invested has already been demonstrated in a report on a study headed by Iain McNicoll of Strathclyde University, the CVCP says. It argues that assessment regimes ensure institutions are fully accountable, and recent performance indicators show that they are efficient by international standards.

The submission paper says there is a "growing bond of interdependence between society and higher education institutions as they become ever more central to the economic well-being of the nation, regions, localities and individuals".

But it warns that "without increased investment in higher education to nourish the learning society, the hopes for the creation of a new Britain with wider life chances will be dashed".

The CVCP identifies five "investment needs" that it says must be fulfilled if the sector is to achieve government targets.

Quality must be maintained

If Britain's social and economic needs are to be met, there must be new investment worth Pounds 125 per student in 2001-02, Pounds 250 in 2002-03, and Pounds 350 in 2003-04. The total bill for such investment would be Pounds 1.375 billion.

The CVCP says it acknowledges the "considerable investment" that the government has committed to higher education since May 1997, but it remains "concerned at the continuing funding cuts per student". The latest funding announcement for 2001-02 reduces funding per student by a further 1 per cent in real terms, on top of a 35 per cent cut over the past decade. This planned cut should be rescinded and funding per student held at the resulting level throughout the CSR period.

The submission argues that if such levels of public funding are not made available, it will mean investment in schools and colleges to raise standards will not be matched by opportunities in higher education; the quality of the student experience will suffer; the rich diversity of British higher education will be constrained; innovative approaches to teaching and the development of new learning materials will be in jeopardy; students will be taught using obsolete equipment; the advantages of using new technology will not be realised; and the higher education staffing structure will not support the needs of the sector.

Participation requires aid

Universities are central to the government's aim of increasing social inclusion, the submission says. This has been at least partly realised in the prime minister's announcement of a new participation target of 50 per cent of under-30s by 2009.

But if universities are to play their part in achieving this goal, they will need an extra Pounds 425 million. The CVCP says this additional spending would be justified because universities are supporting attempts to broaden the student intake.

It argues that "measures to expand higher education should ensure the articulation of provision within further education and higher education institutions, so that learners can progress easily from sub-degree to degree-level study and beyond. Flexible modes of study, credit systems, the accreditation of prior learning and progression agreements between institutions are some of the means by which universities can facilitate this progression".

The CVCP uses the submission to sound warning bells over the possible outcome of the Cubie inquiry on student finance in Scotland. It says it strongly supports the principle of student contributions through fees on the grounds that graduates are major beneficiaries of higher education. It adds: "It would be unfortunate if changes in funding in one part of the UK damaged cross border flows of students, which we consider to be crucial to a vibrant higher education sector and to student choice".

Teaching needs support

The CVCP says new investment in the learning and teaching infrastructure to the tune of Pounds 500 million is needed to safeguard standards. This will enable universities to extend higher education to a wider population; take advantage of advanced information technologies; offer additional opportunities for lifelong learning; and maintain a competitive position in international markets.

In IT, the submission points to evidence compiled by the Dearing committee and a joint Department for Education and Employment/Higher Education sector working group to show that extra investment is needed. Dearing recognised that higher education was becoming an internationally tradeable commodity, and that the development of IT learning materials would both be critical and require considerable expenditure.

The working group said the sector needed Pounds 43 million per year for student support in IT and Pounds 12 million for staff training; Pounds 30 million a year for developing institutional IT networks; Pounds 100 million a year to provide one computer for every five students; and Pounds 13 million a year for electronic library facilities.

A current annual teaching equipment spend of Pounds 135 to Pounds 185 per full-time equivalent student is low, the submission says. A Programme of Policy Research in Engineering, Science and Technology survey concluded that three-fifths of universities were unable to deliver important areas of teaching effectively due to equipment limitations. The cost of meeting the priority equipment needs of institutions in England and Wales came to Pounds 450 million, PREST said.

Competitiveness costs

Budget announcements, the 1998 competitiveness white paper and the forthcoming science and innovation strategy all place universities at the heart of the productive sector of the economy, the submission says. Universities are ready to play their part in stimulating innovation and competitiveness, but they need more money to do the job properly.

The additional funds for infrastructure, research activity and PhD stipends in the last CSR were welcome, but "essentially plugged a gap". What vice-chancellors say their universities need now is "funding sufficient to remove what remains of the gap".

A study commissioned from PREST has helped identify the scale of the shortfall. The CVCP says this is no less than Pounds 900 million. This extra money should be for basic research, and would enable universities to focus on the development of people in research - attracting the best staff and students.

The CVCP also calls for an additional Pounds 150 million per year to put "third leg" applied research activities "on a sustainable basis". If properly supported the third leg has the potential to enhance commercialisation and knowledge transfer; enable universities to engage in collaborative ventures with industry; boost university contributions to the development of entrepreneurialism; and achieve major change in the growth of Britain's knowledge base.

Bett must be addressed

The recommendations of the Bett report represent an opportunity to address a range of key staffing issues in higher education, all of which imply a need for major investment, the submission report says.

Bett made it clear that future productivity gains in higher education would be difficult to achieve without additional funding, if universities were to avoid loss of quality, it adds. A long-term decline in pay rates has brought about staffing shortfalls in subject areas critical to British higher education's competitive edge, such as business studies, information technology, electronic engineering, accountancy, law and teaching. Further research by the CVCP and the Standing Conference of Principals found that all institutions are experiencing recruitment problems, particularly of high-calibre staff at senior level.

To address these difficulties fully will require an investment of an extra Pounds 675 million to modernise pay structures and evaluation methods, and another Pounds 530 million to tackle recruitment and retention problems, the CVCP says. On top of that, improving management practice and staff development through training will cost an extra Pounds 195 million.