The Office for Students (OfS) recently received guidance from the Department for Education on the spending priorities for the Higher Education Strategic Priorities Grant (SPG) for 2024-25. This funding supports eligible universities and colleges in a number of areas, including the delivery of high-cost subjects, widening access and degree apprenticeships.

Responding to the announcement, Joanna Burton, Head of Policy (Higher Education) at the Russell Group, said:

"The 2024-25 funding settlement outlined in the Government’s latest guidance to the Office for Students (OfS) seeks to protect funding for strategically important subjects such as medicine, engineering and nursing, which is welcome. However, the overall settlement represents a real-terms cut of over £50 million to the Strategic Priorities Grant (SPG). It also appears that the Government will fall short on its 2021 Spending Review commitment to invest an additional £300m in the SPG by this year.

"It is disappointing to see funding for postgraduate taught courses and high-cost performing and creative arts courses being de-prioritised. Postgraduate provision helps to maintain the pipeline of specialist skills needed to drive some of the country’s most successful sectors, from engineering to the creative industries.

"Universities will also need to continue providing significant additional support for students facing ongoing cost-of-living challenges. Our universities have already committed tens of millions again this year as OfS support and maintenance loans fail to keep pace with inflation.

"At a time when there is increasing concern about the long-term financial resilience of UK universities, and when vital cross-subsidy is at risk from changing immigration policy, we need a robust and consistent Government approach to invest in the sector and harness it as a driver of UK productivity and growth."

Notes:

• The Russell Group estimates that English universities supplemented the cost of undergraduate education by an average of £2,500 per student per year in 2022/23. Without a change in government policy and with fees capped at £9,250 per year, we conservatively project this to increase to £5,000 per student per year by 2029/30.
• Funding pressures in the devolved nations mirror and often exceed those in England; in Northern Ireland higher education funding has steadily decreased, in Wales the undergraduate tuition fee is capped at £9,000 resulting in shortfalls in fee income for the Welsh sector compared to England, and in Scotland government funding per Scottish student has also fallen in real terms.
• The £2m uplift on the strategic priorities grant represents a 0.14% increase on last year. Using February’s rate of CPI, this represents a real-terms cut of £53m (source: Wonkhe, 4 April 2024)
• Russell Group universities spend tens of millions of pounds every year to support students through the ongoing cost-of-living challenges, which are exacerbated by maintenance loans failing to keep up with inflation. Students in England on the maximum maintenance loan next year will be almost £2,000 worse off than if loans had kept up with inflation since 2021/22.