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Saturday, 1 June, 2002, 01:02 GMT 02:02 UK
Funding squeeze on universities
mike baker graphic

British universities are sending out distress signals.

Student numbers have shot up over the past decade but the money has not.

Around one university in three expects to be operating in deficit over the next few years unless there is a big cash infusion.

This weekend university lecturers are considering withdrawing their co-operation from the government's plans to attract even more young people into university.


An awful lot is now hanging on the generosity of the Chancellor

The lecturers' union Natfhe says there must be a major cash injection if university expansion is to be achieved without a serious loss of quality.

An awful lot is now hanging on the generosity of the Chancellor in his comprehensive spending review, due in July.

University leaders have submitted a shopping-list amounting to almost 10bn over the next three years.

But the universities have tough competition. Hospitals, railways and schools are all ahead of them in the money queue.

Meanwhile, the latest university application figures show the pressures on universities.

Foreign influx

Some of it is good news. A small detachment of cavalry is on the way. These are the overseas students.


China is now the largest single source of overseas applicants

They are, of course, welcome in themselves but they also financially helpful as they pay full-cost fees.

University applications for the coming year are up by 2% overall.

But whereas the increase in applications from English students is just 0.5%, the increase in overseas applications from outside the European Union is a massive 20%.

The Chinese are leading the way. This year there are almost 10 times as many applications from China as there were in 1999.

Useful income

China is now the largest single source of overseas applicants.

This is not just the result of economic development in China. British universities have been recruiting hard there and elsewhere.

There has also been an increase in applications from Hong Kong, Malaysia, India, Pakistan and Nigeria.

International students now comprise 12% of the total at British universities and those from outside the European Union contribute over 600m of teaching income.

As I say, this is the good news. British universities still have a good international reputation and they want to keep it that way.

Achilles heel

However, competition is going to get tougher. The 1999 Bologna Declaration seeks to make European universities more globally competitive.

Universities on the Continent are adopting degree structures that are similar to those in the UK. So it's likely they will challenge British universities in the market for overseas students.

Competition may be a good thing. While British universities have a good international reputation, they have nothing to fear.

But university leaders fear the under-funding of domestic students is undermining the quality and competitiveness of British universities.

The vice-chancellors' organisation, Universities UK, say that while student numbers have risen by 88% since 1989, funding per student has fallen by 37% in real terms. Quality is likely to be affected.

Expansion

This why the Natfhe lecturers are threatening to withdraw co-operation from the government's expansion plans.


Universities also claim that widening access to students from a broader range of social classes will increase their costs

They claim that class sizes are growing, the quality of teaching is suffering and staff recruitment is reaching a crisis.

The pressures are likely to grow as a result of the government's two main targets for universities: getting 50% of 18 to 30 year olds into higher education by 2010 and "broadening access" so more young people from lower socio-economic groups get a university education.

These are big targets.

According to the Higher Education Funding Council for England (Hefce), they mean the enrolment of an extra 350,000 additional students by 2010. That is a 35% increase on current numbers.

Expensive

Moreover, if student-teacher ratios are not to deteriorate further, universities will have to recruit an additional 17,000 academic staff to teach the extra students.

As if this was not a high enough mountain to climb, the universities also claim that widening access to students from a broader range of social classes will increase their costs.

A pilot study commissioned by Universities UK and Hefce suggests that it is significantly more expensive to recruit and to educate students from "non-traditional backgrounds" - that is, families with no previous experience of higher education.

There is a variety of reasons for these extra costs. For a start, non-traditional students are likely to require a greater, and more costly, recruitment drive.

Students from poorer homes are more likely to qualify for hardship funds and other forms of financial support.

Finally, universities will need to set up new types of courses (such as distance learning or work-based study) which will be expensive to start up.

Under review

In all, the universities estimate the cost premium of recruiting non-traditional students is around 35%.

If accurate, that is considerably higher than the current funding premium for recruiting students from under-represented groups which is set at around 10%.


Vice-chancellors are very worried indeed that more student support will be allocated at the expense of core investment

Meanwhile, as the universities anxiously await the comprehensive spending review, students, prospective students and their parents should soon know the outcome of the government's review of student grants, loans and fees.

The government wants to make university more affordable for the least well-off. Otherwise they will vote with their feet and stay away.

But more money channelled towards student support could mean less money to give to the universities.

The vice-chancellors are very worried indeed that more student support will be allocated at the expense of core investment in university infrastructure.

The review of student support is likely to be published around the same time as the spending review. University leaders are in for an anxious few weeks.

Meanwhile it is just as well their recruiters are doing so well in China.


We welcome your comments at educationnews@bbc.co.uk although we cannot always answer individual e-mails.

See also:

30 May 02 | Education
31 May 02 | Education
28 May 02 | Education
22 May 02 | Education
25 Apr 02 | Education
Internet links:


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