Treasury told not to pinch cash

CASH from the sale of student debt must be pumped back into universities for the sake of the British economy, vice chancellors have warned ministers.

They say quality is at risk unless more money is provided for university staff, students, research, innovation and infrastructure.

In its submission to the next Public Expenditure Survey, the Committee of Vice Chancellors and Principals calls for immediate action to shift university funding jointly onto the state, employers and graduates.

While the committee says it will await the results of Sir Ron Dearing's inquiry on higher education, it does not want "a policy vacuum" on funding while the new Government reviews the findings.

It says the sale of the Student Loan Company debt next year should provide about Pounds 1.6 billion for higher education, although the "funding gap" is significantly higher. "CVCP would expect Government to use the bulk of these proceeds to re-invest in higher education," it says.

Vice chancellors also want money now earmarked for maintenance grants to be ploughed back into higher education if the Government decides to scrap the existing means-tested system.

The call follows concern that the Government may want to channel savings from student funding to boost Treasury coffers.

A spokesman for the Department for Education and Employment said it was impossible to comment until Dearing reported. And a Treasury spokesman said changes to student grants were still just speculation. "Education is the Government's main priority so it would look carefully as how best to allocate any money," he said.

The CVCP submission, published today, says universities make a powerful contribution to national prosperity but that Britain is lagging behind many other OECD countries in the amount it invests.

It says at least Pounds 474 million is needed for research equipment and another Pounds 1.25 billion for building maintenance. Research infrastructure needs about Pounds 530 million more. The CVCP warns that multinational companies with a UK base are moving their research abroad because of poor university infrastructure, and international students, who add Pounds 1 billion to the trade balance, could be put off by low funding.