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Government funding of universities to hit 100-year low

Fundraising | Celina Ribeiro | 5 Jan 2012

Universities will have to rely increasingly on fundraising and student fees as a new report finds that government funding of universities is set to plummet to a proportion not seen since the early 20th century.

Government reforms to university funding will see the income universities receive from the public coffers drop to 15 per cent of total income by 2014/15, nearly half the proportion made up by government funding in 2010/11. The University and College Union (UCU) estimates the total government funding of universities in 2010/11 at £6.6bn and predicts it will fall to a total of £3.7bn in the following three years.

The research, published today by the UCU, was accompanied by warnings about the long-term impact of the funding reforms to university education in England.

“These plans put at risk decades of progress in opening up access to education and will endanger the health of the sector,” said UCU general secretary Sally Hunt.

The UCU said that this level of government funding, as a percentage of overall university income, has not been seen since the first decade of the 1900s.

Meanwhile, the well-publicised student fee hikes will mean that the proportion of income universities receive from tuition fees will increase to 47.2 per cent, the highest level since the 1890s. The total value of tuition fee income to universities will have increased threefold between 2000/01 and 2010/11, UCU claims. The union predicts this will rise only further leading to 2013/14 when it estimates tuition fees will account for £11.3m in income, compared with £2.6m in 2000/01.

While the level of government funding has fallen, fundraising for higher education has been buoyed in recent years on the back of a government match fund programme, which offers different levels of match funding to private donations to universities. This programme, which began in 2008, ended last year leaving universities and colleges to fundraise on a simpler, and less lucrative, proposition.

The impact of high student fees and alleged government under-funding is yet to be seen, but many working in the field fear that students lumped with high levels of debt left over from their undergraduate years may have a reduced capacity, and propensity, to donate to their alma mater.

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