Proportion of UK GDP devoted to higher education falls again

Investment in higher education in the UK as a share of national wealth dropped further behind the average among industrialised countries even before the current funding reforms, according to an annual report.

September 13, 2011

Figures from the Organisation for Economic Cooperation and Development’s latest Education at a Glance study, published today, show that the UK spent 1.2 per cent of its gross domestic product on tertiary education in 2008, below the OECD average of 1.5 per cent.

The fall from 2007, when the figure was 1.3 per cent, was due to a drop in the amount of public money going into higher education from 0.7 per cent to 0.6 per cent of GDP, leaving only Japan lower among OECD nations.

Wendy Piatt, director of the Russell Group of research-intensive universities, said that the figures “signal that without more investment, the UK risks jeopardising the competitive advantage which has made our universities the envy of the world”.

“Our universities are already doing more with less, and we will continue to find ways of increasing efficiency.

“But we must aim to bring our investment in higher education closer to that of our major competitors, whether through increased public funding, private investment such as philanthropy, or tuition fees backed by a fair system of loans,” she added.

The report also shows that the share of private expenditure on higher education in the UK had almost doubled from 32.3 per cent of total spend in 2000 to 65.5 per cent in 2008 due to the tuition fee reforms of the last decade.

In the academic year 2008-09, again well before the current funding reforms were decided, students in the UK were paying the third highest annual tuition fees among OECD countries at $4,840 (£3,046) – behind the US and Korea.

Other figures in the analysis reveal that the UK was lagging behind in its participation rate for 20- to 29-year-olds.

Just 17 per cent of the age group were in education in 2009, well below the OECD average of 26 per cent.

Sally Hunt, general secretary of the University and College Union, said: “The UK’s poor record of investment in educating adults places us at a real disadvantage against other countries. We need an urgent debate about the importance of education and skills to our economy and society before it is too late.”

• For full coverage of the OECD analysis, see Times Higher Education this Thursday.

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