Minister eyes English funding reforms ‘sooner rather than later’

The Westminster government hopes to share details of a new funding settlement for English universities “sooner rather than later”, according to skills minister Baroness Smith of Malvern, who referenced the budget at the end of this month.

Speaking at Times Higher Education’s World Academic Summit, being held at the University of Manchester, Baroness Smith said that the current funding system – with tuition fees all but frozen for 12 years, some universities on the brink of bankruptcy, and student maintenance funding lagging behind inflation – was “not working”.

“We are clear that universities are autonomous organisations, but I very much don’t want to be in a position where we’re losing capacity in higher education and I certainly don’t want to be in a position where students are being enormously disrupted by the failure of a university in the UK,” Baroness Smith told the event.

“We need to think about the whole range of ways in which universities receive their funding, so yes that is through tuition fees…it is about government grants, and it is also of course through research funding and my colleagues in the Department for Science, Innovation and Technology are also thinking about the research funding environment and what we need to do there.

“So yes, we’re working on a whole range of options and we hope that we will be able sooner rather than later – but it will take some time – to come back with that funding settlement that can provide more stability for universities as well as more support for students, who have been hit particularly hard by the cost-of-living crisis and also have not seen their maintenance support increasing in line with inflation either.”

Baroness Smith said that the Labour government had “immediately started thinking about the options for a new funding arrangement that could be fair to institutions and students and the broader work of universities” after its election, referencing the decision to refocus the work of the English sector, the Office for Students, on financial stability.

She said she could not provide details of any new funding settlement yet, but noted: “We have a budget coming at the end of October.”

Baroness Smith said that improving the stability of sector funding was just the start of what Labour wanted to achieve with universities, citing a desire to close the gap in university access between students from the most and least privileged backgrounds, and ensure that higher education contributed towards the new government’s “growth mission”.

But she was critical of what she described as the former Conservative government’s “tendency to see higher education as a political battlefield” or as a “stick to make political points in a way which was very unhelpful to higher education”.

She said Labour was “enormously proud” of the UK’s higher education system “as an enabler of the economy and of individuals”, and that the new government “wanted to act to support the development” of the sector.

The minister said that this extended to welcoming international students, another area in which she said the last government had “lost its way”, introducing a string of policies that have been seen as discouraging overseas learners from coming to the UK.

In contrast, Baroness Smith said that she thought international students and researchers played an “incredibly important” role in UK higher education – citing the financial contribution made by their tuition fees, but also the benefit to domestic learners from studying in a global environment, and the power of cross-border scientific collaboration.

“All of these things are phenomenally important for us,” she said. “It’s an aspect of great global pride for us in the UK.”

chris.havergal@timeshighereducation.com