University incomes and costs rise

This was 6.5% higher than the 2003-04 total of £16.9bn, according to the Higher Education Statistics Agency.

The biggest single source of income was grants from funding councils. But the biggest increase, almost 24%, came in the form of investments and donations.

Spending rose by 6.7% to £17.8bn, so the surplus within the sector overall fell from £237m to £213m.

The endowment and investment increase in Scotland was 11% compared with 53% for Northern Ireland, 32% for Welsh universities and nearly 25% in England.

A spokesman for the vice-chancellors' group, Universities UK, said the increase reflected in part the extra fundraising initiatives of recent years.

"Although fundraising is seen as a long term activity by higher education institutions and is only a small part of the overall income, it's clear that the higher priority given to it is beginning to pay off."

This year 27 had received matched funding from the government to increase their income from private donations.

Pay dispute

Staff costs rose from £9.7bn to £10.4bn.

Academic staff in two unions are engaged in an assessment and marking boycott in pursuit of higher pay.

The ongoing action follows a one-day strike in March.

A second round of talks, arranged through the conciliation service Acas, are set to take place on Tuesday.

The employers have offered a rise of 3% from August this year and an extra 3% from August 2007.