UFI to get few public funds

The government will fund less than half of the start-up costs of its flagship University for Industry, ministers confirmed this week. And question marks remain over its long-term funding.

Launching the long-awaited UFI pathfinder prospectus, education minister Baroness Blackstone said she wanted to make the UFI "a household name and an integral part of our national life" - like the Open University.

But with the initial focus on the basic skills of information technology, literacy and numeracy, Baroness Blackstone conceded that there could be controversy over the use of the term "university". Despite this, the UFI's name will remain as it is, she said. "The name is now established. People are becoming aware of it," she said.

Baroness Blackstone confirmed that launching the UFI in 2000 is expected to cost Pounds 50 million. But the government will directly contribute only Pounds 15 million to the project in the financial year 1998-99, she said, with Pounds 6 million more from the public purse via the Further Education Funding Council.

The remaining start-up money will come from European Social Fund grants, Baroness Blackstone said. Long-term funding will rely mainly on the goodwill of employers and subscriptions from education providers who want to use the UFI "kite-mark".

The prospectus indicated that the UFI should be "commercially viable". The UFI, in essence a brokering service for courses, is expected to sustain itself on income from services such as brokerage and guidance and charges to employers and education providers. Income from the infrastructure will include franchise fees, sponsorship and the sale of database information.

Ministers concede that much of the UFI's success will rely on private-sector finance. "We hope that a number of companies will pick it up and want to contribute," Baroness Blackstone said.

Public money, she said, would support only the UFI's basic skills provision, "but it may not be provided in quite such a direct way". Students will pay for courses with Individual Learning Accounts, which give Pounds 150 each to 1 million employees, set up with Pounds 150 million of money from the training and enterprise councils' reserves.

Members of the UFI's now-disbanded design and implementation group have expressed concern that the project lacks a realistic long-term funding model. One, Diana Laurillard, pro-vice chancellor of the Open University, said "there is nothing definitive on why an education provider should buy into the UFI".