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Understanding Uk University Funding Issues

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I need, for reasons to long to explain here, to quickly learn/understand the basic 'mechanisms' by which UK universities get their funding - both 'historically' until relatively recently and, if there have been major changes, through to the present day.

Typically what proportion of total funding for a given university comes from central government grants, how much from generous private donations (i.e alumini, private investors) and how much from student fees. I realise that this will vary greatly from the older univeristies like Oxford & Cambridge and the more modern smaller ones, as well by what their specialisation is (e.g whether they are big on sciences or arts, etc).

I also need to understand what business/tax status universities hold (e.g. are they classed as charities, does their increasing commercial activities via spin-out companies affect this, etc)

Can anyone point me to any good websites that will give much of this sort of info in reasonably summarised form, as opposed to specialist in depth detail.

My specific interest is in science research and teaching in UK universities, rather than the humanities, arts or social sciences.

Thanks in advance

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I need, for reasons to long to explain here, to quickly learn/understand the basic 'mechanisms' by which UK universities get their funding - both 'historically' until relatively recently and, if there have been major changes, through to the present day.

Typically what proportion of total funding for a given university comes from central government grants, how much from generous private donations (i.e alumini, private investors) and how much from student fees. I realise that this will vary greatly from the older univeristies like Oxford & Cambridge and the more modern smaller ones, as well by what their specialisation is (e.g whether they are big on sciences or arts, etc).

I also need to understand what business/tax status universities hold (e.g. are they classed as charities, does their increasing commercial activities via spin-out companies affect this, etc)

Can anyone point me to any good websites that will give much of this sort of info in reasonably summarised form, as opposed to specialist in depth detail.

My specific interest is in science research and teaching in UK universities, rather than the humanities, arts or social sciences.

Thanks in advance

Your question is simply too broad to answer as the answer depends strongly on which University you look at. Moreover things are pretty unclear at the moment due to things like the AAB-policy changing the landscape with big drops in student numbers for some. Anyway, for most Universities teaching will be the biggest part of the budget, followed by research funding from councils & EU. Alumni-donations are typically a small fraction, except for Oxford&Cambridge.

My suggestion would be to look at the THE (Times Higher Education). They publish tables with the numbers you are after for all Universities in the UK every year. Would require a subscription, but is pretty affordable.

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I need, for reasons to long to explain here, to quickly learn/understand the basic 'mechanisms' by which UK universities get their funding - both 'historically' until relatively recently and, if there have been major changes, through to the present day.

Typically what proportion of total funding for a given university comes from central government grants, how much from generous private donations (i.e alumini, private investors) and how much from student fees. I realise that this will vary greatly from the older univeristies like Oxford & Cambridge and the more modern smaller ones, as well by what their specialisation is (e.g whether they are big on sciences or arts, etc).

I abualso need to understand what business/tax status universities hold (e.g. are they classed as charities, does their increasing commercial activities via spin-out companies affect this, etc)

Can anyone point me to any good websites that will give much of this sort of info in reasonably summarised form, as opposed to specialist in depth detail.

My specific interest is in science research and teaching in UK universities, rather than the humanities, arts or social sciences.

Thanks in advance

As moesasji says this is a very complex question, however a good start is to look at the research council uks websites - try "grants on the web" at www.epsrc.ac.uk which lists the current research funding to each institution in the uk. University websites might list the number of " academic related staff" these are generally research relative expenditure

However, the issue of endowments is much more complex as each Oxbridge colleges has its own, some are fabulously wealthy, some poor as church mice... The rich ones spend a lot of it hiring fellows to do research...

Universities are generally charitable non profit making organisations, they do not make much from parents except for a few exceptions.

These and other universities have an odd assortment of assets, museums, stately homes, you name it. Manchester holds loads of farm land out in Cheshire, mainly because sir Bernard Lovell get buying get buying it to prevent development interfering with the radio reception at joderell bank!!

This kind of stuff is very difficult to get information about so good luck!

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Your question is simply too broad to answer as the answer depends strongly on which University you look at. Moreover things are pretty unclear at the moment due to things like the AAB-policy changing the landscape with big drops in student numbers for some. Anyway, for most Universities teaching will be the biggest part of the budget, followed by research funding from councils & EU. Alumni-donations are typically a small fraction, except for Oxford&Cambridge.

My suggestion would be to look at the THE (Times Higher Education). They publish tables with the numbers you are after for all Universities in the UK every year. Would require a subscription, but is pretty affordable.

Thanks. You have gone some way to answering what I need to know.

I realise I worded the question way to vaguely.

But just to clarify your comment re: "for most Universities teaching will be the biggest part of the budget"......do you mean that it will be the biggest source of income (from fees?) OR the biggest source of expenditure? Or put another way, do universities take in more in fees for tuition than they actually spend on delivering tuition?

My understanding is that individual research activities within, say, a department of chemistry will be funded by grants that the individual researchers get awarded from the dedicated research funding councils (which in turn get their money from central government, which ultimately means taxpayers money?).

But the cost of actually running and maintaining the wider physical infrastructure of the dept. of chemistry (i.e building and labs, etc) comes from university funds? which are siphoned off from, say, tuition fees?

Finally, in respect of spin-out companies.....presumably these are an increasing source of income for universities? and the professors and inventors of some new technology that gets spun out don't actually reap huge financial rewards? (i.e the IP belongs to the university and not the researchers?).

But thanks again anyway for your reply so far.

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Such a complex issue cannot be generalised!!

In a school of Mathematics all that is needed for research is a few pencils, paper or perhaps a PC

In an engineering school 90% of the income might be overseas students fees

All this money goes into the central university account

Finally/ do students - EU or non EU want to study at a university that does no research? Their final year dissertations may involve working one on one with researchers at the top of their field etc

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But just to clarify your comment re: "for most Universities teaching will be the biggest part of the budget"......do you mean that it will be the biggest source of income (from fees?) OR the biggest source of expenditure? Or put another way, do universities take in more in fees for tuition than they actually spend on delivering tuition?

The only thing I was saying is that for most universities the biggest fraction of the money coming in will be based on the delivery of teaching. However if you look at the science based courses I sincerely doubt that the fees cover the actual costs of the delivery. The fact that commercial suppliers in the US don't offer this kind of course says enough. ;)

My understanding is that individual research activities within, say, a department of chemistry will be funded by grants that the individual researchers get awarded from the dedicated research funding councils (which in turn get their money from central government, which ultimately means taxpayers money?).

But the cost of actually running and maintaining the wider physical infrastructure of the dept. of chemistry (i.e building and labs, etc) comes from university funds? which are siphoned off from, say, tuition fees?

This is far too simplistic. Yes, some research will be funded by research grants partly coming from the government. These grants will include something that is called overheads, from which upkeep of buildings, equipment, access to literature, etc is funded as well. These research grants are fully costed to cover actual costs and are not subsidized from tuition fees (look up FEC). Note that these grants come from EU, Wellcome Trust, Leverhulm; Gates Foundation. As you see this includes charities, some of which are in fact far bigger funders then government research councils.

The amount of money you see on something like Grants on the Web (GoW) might look big; however once you realize that employing a researcher with a PhD in itself costs about 80-100k a year (salary, taxes, lab and office-space) you probably realize that the amount of man-hours being funded is very limited if once compares it against countries like China, Japan, Korea, etc.

However getting these grants is incredibly difficult (5-15% succcess rate on typical grant applications, with some going <5%); and if not successful you can't resubmit). Hence a considerable fraction of academics will hence not have a research grant but will still have a "bit" of time to do research. This is then time the university effectively pays to keep their staff research active as in the end teaching is partly research driven as students as part of their degree will participate in research projects.

Finally, in respect of spin-out companies.....presumably these are an increasing source of income for universities? and the professors and inventors of some new technology that gets spun out don't actually reap huge financial rewards? (i.e the IP belongs to the university and not the researchers?).

I doubt that you would find this to be a big income stream. Protecting IP is expensive and fraction of spinouts being successful enough to even cover costs is very small.

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Here's the ones i can remember. It's the order i remembered them which will be similar but not the same as how important they are, which as has been said will differ by institution. I'm also a little drunk, so may miss things out. If you're intetested in a particular University download their accounts and associated statements. It should all be in there somewhere

1. Higher Education Funding Council England (HEFCE) or HEFCW in Wales. (I've no idea about Scotland or NI ) pay out fees for credits achieved. These have now been reduced because of the new higher level tuition fees.

2. Tuition fees

3. Research Council Funding

4. Commercial Activity (most have an associated company that does all the commercial stuff and donates all its profit back to the University. This allows the actual University as a legal entity to maintain a charitable status)

5. EU Framework programmes (now rebranded horizon 2020), amd other similar EU research initiatives ( plus Convergence funding in Wales)

6. Technology Strategy board, Carbon Trust and other UK government funded research initiatives

7. Leaning on old alumni for cash

8. Endowments and legacies

9. IPR, patents etc.

10. Fees for student accomodation

11. Parking charges

12. Library fines : )

Edit to add: I'm in Wales and funding also comes via the Welsh Goverment and their various off shoots. Something similar probably happens in Scotland, NI, and in the regions in England but i've never needed to find out what.

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Here's the ones i can remember. It's the order i remembered them which will be similar but not the same as how important they are, which as has been said will differ by institution. I'm also a little drunk, so may miss things out. If you're intetested in a particular University download their accounts and associated statements. It should all be in there somewhere

1. Higher Education Funding Council England (HEFCE) or HEFCW in Wales. (I've no idea about Scotland or NI ) pay out fees for credits achieved. These have now been reduced because of the new higher level tuition fees.

2. Tuition fees

3. Research Council Funding

4. Commercial Activity (most have an associated company that does all the commercial stuff and donates all its profit back to the University. This allows the actual University as a legal entity to maintain a charitable status)

5. EU Framework programmes (now rebranded horizon 2020), amd other similar EU research initiatives ( plus Convergence funding in Wales)

6. Technology Strategy board, Carbon Trust and other UK government funded research initiatives

7. Leaning on old alumni for cash

8. Endowments and legacies

9. IPR, patents etc.

10. Fees for student accomodation

11. Parking charges

12. Library fines : )

Edit to add: I'm in Wales and funding also comes via the Welsh Goverment and their various off shoots. Something similar probably happens in Scotland, NI, and in the regions in England but i've never needed to find out what.

Also franchising of courses and investment income

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  • 244 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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