204 - HEFCE: the insiders view


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  • Further and Higher Education Act 1992 section 65:make grants, loans or other payments to the governing body of any higher education institution in respect of expenditure incurred or to be incurred by them for the purposes of any activities eligible for funding… subject in each case to such terms and conditions as the council think fit.Further information is available at http://www.hefce.ac.uk/about/intro/historyofhefce/
  • What does HEFCE do? Here is the HEFCE bull’s eye from our publication “Opportunity, Choice and Excellence”, which is our high-level strategy statement about how we propose tacking the challenges and opportunities that face us and the rest of the HE system.In the middle are the three things that all of HE does, then there are the principles that we would like to aspire in supporting HE – opportunity, choice and excellence and finally the four “practices” – the four things that we do in practice to achieve this.We’ll look at them in turn
  • Here’s the easy one – the clue’s in the name. We are the Higher Education Funding Council for England. We are and have been about public investment in HE – although we are not the only public investment in HE
  • This slide explains where HEFCE-funded institutions derive their income. The top row is public investment and the bottom row is private income. It also makes clear that HEFCE was among the biggest funders of universities and colleges. We provide a block grant to cover teaching, research and knowledge exchange, but do not specify what it should be spent on except that it must be on purposes for the promotion of HE. Source: HESA finance record 2010-11, HEFCE-funded HEIsNote 1: This income includes a share of income in joint venture(s) of £121M.Note 2: This income includes £95M of income that has been passed on to other institutions or organisations as part of a collaborative project or subcontracted work.Note 3: We do not have precise data on postgraduate fees paid by UK research councils. Full-time postgraduate research fees from 'other' sources is used to estimate this. ('Other' sources are those other than the SLC and DH).Note 4: 2010-11 refers to the academic year ending 31 July 2011.
  • This slide explains how we have historically allocated this on funding year basis. Start at midday and move round clockwise. At the beginning of the financial year in April, HEFCE has, in the past, had discussions with the government about the next year’s funding. In December/January the government tells HEFCE in a “grant letter” the amount of funding that HEFCE will receive. In January the HEFCE board makes decisions about how to allocate that money. It decides how much money is to be given for various sorts of programmes – laboratory-based, classroom-based, clinical. It might decide too, for example, that it will only provide QR funding for universities who had a particular rating in RAE. Armed with those decisions, and using the information that HEIs have provided on their current year student numbers, HEFCE staff work out how much each institutions will get and we publish those figures in March. Institutions check them through and then they are adjusted.Meanwhile, HEFCE has started to talk to government about the next year. Or at least that’s what it did in the past.For more information http://www.hefce.ac.uk/finance/fundinghe/
  • This slide explains that the money that HE receives will not decrease. It’s just coming from different places. Our grant (red) decreases and the income coming student fees (blue) increases, but it’s still public investment because the student doesn’t start to repay until they are a graduate.As public investment the government must be sure that it has been properly spent
  • In the past we’ve tended to operate around accountability for funding.We must operate according to the guidelines of Managing Public Money: general rules governing administration of public funds, and some more specific provisionsWe’ve got to provide assurance to the Public Accounts Committee about how that money is spent and we do this through our annual monitoring process.
  • Our approaches to monitoring accountability for public funding must look like regulation and feel very intrusive.In our own minds however we are clear that institutions are autonomous organisations and that we are not a central planning organisationSo the question is what does this do for HEIs?Two things:- Provides assurance to government and gives them confidence to continue the flow of money to you in each comprehensive spending review- Provides confidence to the banks and other organisations with which you engage.
  • Providing assurance that the money is well spent, giving confidence, demonstrating the good news story, is rather like acting as an advocate. We’ve always done this since we were set up in 1992 and we’ve always regarded it as assurance, promoting confidence. The word we have used is accountability.Then in 2010 we started to use a new word “regulation”, because that was when we took up a new role as Principal regulator for institutions that are exempt charities. We were asked to do so by the government after the review of the Charities Commission. The idea is that we act on behalf of Charity Commission – this means that HEIs only have to deal with us and not with another oversight body. Might be described as a practice run for a wider regulatory role.
  • Reminder of the four practices of HEFCE – we’ve covered the first two. Let’s now move on to the second two.
  • HEFCE is in a unique and very privileged position. It’s in the middle of the sector and it has access to a lot of information. This is not meant to imply that we are the centre of the universe, but it does help to explain why we’re in a good position to provide information. We’re very well-placed to observe and to observe across the range of universities and colleges, whatever mission group they belong to. We take advantage of this to do a number of things.
  • Here are some recent publicationsWe provide information ABOUT the sector – telling the good news story. The middle publication is our review of the financial health of the sector, recently published, which concludes that universities and colleges are well-managed and in good financial shape. We also provide information FOR the sector.The publication to the left is our guidance on scope 3 emissions, produced as part of our programme of work coordinating the sector’s response to the environmental legislation.The publication on the right is an update of some guidance we produced on mergers some years ago. We have now gatherhed information on Collaborations, Alliances and Mergers and made it available. We are consulting with the sector on the form in which this should finally be published.
  • Publications are the most obvious area, but we have been involved in supporting existing initiatives like the Unistats web-site and the National Student survey. From September 2012 there will also be the Key Information sets, which are comparable sets of standardised information about undergraduate courses. They are designed to meet the information needs of prospective students and will be published 'in context' on the web-sites of universities and colleges.There will be a KIS for all undergraduate courses (including part-time) planned for 2013-14, on which students at HEIs are registered, or which are run through private providers who subscribe to the Quality Assurance Agency for Higher Education. Undergraduate programmes taught through further education colleges will also require a KIS.
  • Building on what we do already in producing publications like the ones we saw on the screen, we are going to develop an “observatory” function to monitor and report on the effects of the changes in the funding method.
  • Turning then to the fourth of the “practices”
  • Here are HEFCE’s policy priorities for 2012 and you can see I’ve highlighted some partners in there. A few more are implicit but not actually stated – research funders, business communities
  • As we move forward into the new funding environment, HEFCE and SLC have established an interim regulatory partnership group to look at how to make the new funding and regulatory arrangements work most effectively. Membership is on the slide.The Group has commissioned two projects to review how the sector agencies work together now and identify approaches to streamline it and to design a new data landscape to support it.There is a email bulletin covering the work of the group, which you can request at: http://www.hefce.ac.uk/pubs/signupfore-mailalerts/And there is a web-site describing the data project at http://landscape.hesa.ac.uk/
  • Some internal restructuring is taking place at HEFCE, though not a lot. HEIs will be pleased to know their primary contacts the institutional teams will still be there.
  • 204 - HEFCE: the insiders view

    1. 1. HEFCE: the insider’s view Kath Thompson AUA Conference Manchester 3 April 2012
    2. 2. Introducing HEFCE
    3. 3. HEFCE: the background• Non-departmental public body (NDPB): formed in 1992 under the Further and Higher Education Act• Devolved administrations have their own arrangements• Independent body to implement government policy and advise government on HE
    4. 4. What HEFCE does for you A. Investment B. Regulation C. Information D. Partnership
    5. 5. Investment
    6. 6. Sources of income for HEFCE-funded HEIs, 2010-11 Department for Business Other Innovation and Skills UK Research councils governmentSLC/LEA HEFCE, TDA & Research grants & Postgraduate Research Non-research fees SFA funding contracts fees £973M £1,473M £2,494M £7,205M (31.4%) £1,248M (5.4%) £117M (0.5%) (4.2%) (6.4%) (10.9%) HEFCE-funded Higher Education Institutions Total income £22,933M Other research UK charities Overseas student Residences and Other income income £761M fees catering £4,257M £581M (2.5%) (3.3%) £2,513M (11.0%) £1,310M (5.7%) (18.6%) Other fee income £1,878M Income for non-research services £964M Endowments £196M Other operating income £1,219M Source: HESA finance record 2010-11, HEFCE-funded HEIs
    7. 7. HEFCE: investmentFees have been increased to a maximum of £9000Funding that used to come as grant to pay forteaching through HEFCE has been reallocated toStudent Loans Company beginning in 2012Graduates will repay when their income exceeds aspecified figureHEFCE will continue to fund but at a lower level –investment will centre on the student interest:• Student opportunity – widening participation and retention• High cost subjects• Small specialist institutions• Strategically important and vulnerable subjects
    8. 8. Regulation
    9. 9. HEFCE: accountability or regulation• Annual Monitoring Statements (AMS)• HEFCE Assurance Reviews• Financial Monitoring• Risk Assessment and Notification• Data Audit Reviews
    10. 10. HEFCE: accountability and regulation• Confidence in HE• Principal Regulator for Charities legislation• Proposed “lead regulator” role
    11. 11. HEFCE: regulation A. Provider designation for student support and HEFCE teaching grant B. Develop a single gateway for new providers
    12. 12. What HEFCE does for you A. Investment B. Regulation C. Information D. Partnership
    13. 13. Information
    14. 14. Publications
    15. 15. Information about the sectorUnistats web-siteNational Student SurveyKey Information Sets
    16. 16. Information: HEFCE ObservatoryMonitor and report on effects ofchanges in HEe.g.• tracking student demand and participation levels• postgraduate level entry• effects of increased competition on price and quality
    17. 17. Partnership
    18. 18. HEFCE’s policy priorities for 2012 • Understanding the effects of the new financial arrangements for HE in England - on students, institutions and government (report to BIS by December 2012) • Consultation on new funding approach for teaching and student number controls from 2013-14 • Supporting new framework for widening participation and fair access • Continued commitment for dual support system as outlined in innovation and research strategy • Contribution of HE to economic growth and recovery through new and innovative approaches
    19. 19. Working in partnershipGuildHEHigher Education Statistics Agency (HESA)National Union of StudentsOffice for Fair Access (OFFA)Office of Independent Adjudicator (OIA)Quality Assurance Agency (QAA)Student Loans CompanyUniversities UK
    20. 20. Internal change at HEFCEFrom 1 April 2012• Three directorates: • Education, Participation and Students • Finance and Corporate Affairs • Research, Innovation and Skills• Institutional Teams
    21. 21. Welcome slide