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Report exposes huge variations in public spending on education across UK

19 November 2015

The introduction of different systems for funding further and higher education across the UK in recent years has led to dramatic variations in levels of public resource for students, says a report released today by UCU.

The report demonstrates how different countries' reactions to the introduction of £9,000 fees in England has led to bizarre funding gaps across the UK. The total public funding for Scottish students studying in England is £5,046 a year, while more than double that amount (£10,928) is spent on Welsh students studying in England.

The differences are exposed in the report  Mind the gap: Comparing public funding in higher and further education [2mb] authored by funding experts Dr Gavan Conlon and Maike Halterbeck of the London Economics consultancy. They argue the report highlights 'large funding gaps across the UK Home Nations but also at different levels in the education spectrum.' 

They discovered that because Scottish students do not pay fees to study in Scotland, Scottish universities are funded directly from the public purse, rather than via loans for students' tuition fees. Because there are no fees for Scottish students studying in Scotland, very few choose to study outside the country. Those that study in England pay tuition fees with the help of a loan from the Scottish government, while their university receives block grant funding from the English funding council.

By contrast, the Welsh government contributes to the fees of Welsh students through both tuition fee grants and loans. This means Welsh taxpayers must pay much more to help Welsh students studying in other UK countries. Welsh taxpayers pay a premium of 9% to enable Welsh students to study in England, whereas Scottish taxpayers save 44% when a Scottish student chooses to study in England rather than in Scotland.

UCU argues that the perverse system mean that Wales is paying to encourage a brain drain while Scotland is saving money and keeping the vast majority of students at home. Over a quarter of Welsh students (27%) study outside of Wales, compared to just one in 20 (5%) Scots who study outside of Scotland.

The report combines for the first time a range of different public funding sources including direct government grants to universities and colleges, and net individual grants and loans for students to create an overall average public investment per student per year. The report's key findings from the year 2013/14 are:

  • the level of public funding per home undergraduate student is highest in Wales (£9,456pa) and Scotland (£9,016pa) with England (£8,870pa) in third place and Northern Ireland a distant last (£7,721pa).
  • the proportion of total funding required to fund an undergraduate's full-time higher education varies significantly by country. In Scotland, approximately 80% of the total cost per student comes from the public purse, compared to 70% in Wales, 68% in Northern Ireland and 63% in England.
  • arising from the different funding systems in place, and different arrangements for the cross-border movements of students, there are widely diverging cross-border payments with English funding agencies contributing £259m a year to support university students studying elsewhere in the UK, Welsh funders contributing £156m for outside Wales, but Scotland spending only £11m.
  • the level of public funding per eligible student is significantly lower in further education than its equivalent in higher education.
  • spending on adult apprenticeships (£1,554pa) in England is just 18% of that spent on undergraduates in higher education (£8,870) with public spending on other adult courses (£1,323) standing even lower (at 15% of the higher education rate).

Report author Dr Gavan Conlon said: 'This is the first time since the latest changes to the English tuition fee system that a comprehensive analysis has been done of levels of public investment in further and higher education. What the study shows is four highly complex national systems within which substantial funding gaps are already emerging, as well as significant differences between the funding of higher and further education.'

UCU general secretary, Sally Hunt, said: 'Every UK politician says that investment in colleges and universities is important, and this report should be required reading for them all. The public funding gaps identified in this report are substantial and will impact both upon the life chances of students and our economy.

'As we approach another Westminster spending review, I hope that the average levels of public investment benchmarked in this report will concentrate the minds of politicians across the UK and produce a clear commitment in each nation to monitor, and where necessary, close the public funding gaps identified.'

UCU said it will be working with London Economics on an annual report to update the figures and is exploring the idea of international comparisons.

Last updated: 10 December 2015