Funding to Universities Reduced in UK

Worldwide trend is to reduce funding to universities forcing them to stand on their own feet. Soon this will catch trend in Gulf. Better be prepared for the worst.


Here is link to the news item
http://www.guardian.co.uk/education/2010/jan/19/university-cuts-peter-mandelson

Universities will benefit from tighter budgets in the long termThe relatively small cut in public funding does not mean a lack of commitment to higher education

In 2009, the government made it clear that higher education would have to shoulder its fair share – but not more than its fair share – of reductions in public spending in the years ahead. Critics of this decision have suggested it will bring British higher education to its knees. Figures from the Institute of Fiscal Studies have further fanned the flames. However, these figures are purely speculative and, in reality, the savings we have set out amount to a reduction of under 5% over the next three years. We need to have a reasoned discussion over how to maintain university teaching and research quality in the face of the wider fiscal realities.

A more positive view makes a virtue of fiscal necessity, especially when you look at the big trends in British higher education.

Tighter budgets can be a spur to further diversifying the funding of British universities. It can also focus minds on teaching and research excellence and new ways of delivering higher education. Both of these trends are already part of the picture of British higher education. Both need to become more so.

UK universities have never enjoyed such a long and sustained period of public financial and political support. Since 1997, we have put higher education at the centre of our strategy for building a modern knowledge economy.

In line with this, public investment in British universities has grown by 25% since 1997, reversing a decade of declining investment and standards under the Conservatives. Our research base is now one of the best in the world, and our share of world-class institutions is out of all proportion to our size.

But even with these big increases, public funds represent only a little more than half of university income in Britain. With strong government backing over the last decade, many British universities have taken a more professional approach to attracting donations and endowments. They have widened their sources of income by opening their doors to fee-paying international students and by building more collaborative relationships with business and industry to fund research and teaching. The introduction of higher fees in England has also provided an alternative source of income. These developments are not a reason for removing public funding, but they do lend perspective to the subject.

The result of this growing diversity in university income is that although the government invests £12.3bn in higher education annually, total UK university income was over £23bn in 2007-08. So the proposed £950m in reductions over the next three years affects only a small part of university resources. Even within this stream of public investment, teaching and research funding will still actually grow between 2009-10 and 2010-11. Research funding will grow in real terms this year by 7%. Farsighted universities will use a small reduction in state funding to look at avoidable costs, reinforce diversification and focus minds on what they do best.

Part of the bargain that has included unprecedented levels of support for higher education, and wide autonomy for how it is spent, is the expectation that universities develop unique missions. They should focus on excellence, even where this means withdrawing from areas of teaching or research where they are weaker. The best British universities are already doing this.

Our recent Higher Ambitions policy framework for universities encourages them to develop alternatives to the basic three-year degree, including courses and types of study that are more flexible or more vocational, but still of the highest quality. This focus on new ways of enabling people to gain higher education qualifications is part of a broader reshaping of university study, driven by the fact that school leaver numbers will fall over the next 10 years.

Because they can be based around work or study from home, these routes to qualifications are more attractive to a wider range of people. Importantly, against the backdrop of a gradual reduction in public funds, they also mean lower student support bills, and can attract contributions towards course costs from employers. Developing these alternatives can be a way of universities and colleges saving public money without reducing the quality of teaching. Some universities are already doing this successfully. Their example needs to be followed.

It has never been credible to argue that the UK can support world-class higher education purely on the back of public funding. Universities themselves have often made this case. The best university systems in the world are defined by a wide range of public and private funding and British universities need the same diversity. High levels of public funding for universities in Britain is important for our competitiveness and will always be vital, but it is only part of the picture.

I don't deny that this is a challenging agenda. But by no stretch of the imagination does a 5% reduction in public support over a number of years for universities reverse a decade of committed investment in universities, or leave our best institutions on their knees. It can, however, be an opportunity to do some clear thinking about the future of British higher education.