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Making it count: how universities are using income from variable fees

29 January 2010

Since their introduction in 2006, for the two years for which figures are available, variable tuition fees have brought £1.3 billion1 new income into the higher education sector. This report provides an insight into how this income has been used by English universities. It is based on national data and responses from 62% of English universities to a survey conducted by Universities UK in October 2009.

Key findings

After a long period of decreasing or static funding per student, the new income from variable tuition fees in England,2 combined with increases in funding from other sources, is beginning to make a significant contribution to stabilising the financial position of universities in England, enabling them to invest to improve all aspects of the student experience.


Key points include:

  • fee income totalled £451 million in 2006/07 and £878 million in 2007/08;
  • 25% of fee income, or £335 million, was spent on bursaries and outreach over this two-year period;
  • according to the Office for Fair Access, in 2007/08, 205,000 students from lower income and other under-represented groups received a bursary or scholarship;
  • the median student: staff ratio has improved from 17.6 in 2004/05 to 16.8 in 2007/08;
  • there has been significant investment in buildings and infrastructure. 57% of higher education institutions have improved the quality of their estates (excluding accommodation) in this period;
  • the financial health of higher education institutions has also improved by a number of measures, including levels of liquidity and deficit/ surplus. University responses point to clear decisions about using fee income to improve the student experience. Common themes were:
  • improving the physical infrastructure for teaching and learning including new and refurbished lecture rooms, new social learning spaces, IT upgrades and expanded library services;
  • support for learning, including subject ​specific help, study skills support, virtual learning environments, and support in developing skills for employability:
  • investing in the broader package of student services, including expanded careers advisory services, the provision of more social space, new support centres and major new sporting facilities;
  • supporting students in financial terms, including targeted bursaries and scholarships such as regional bursaries, or bursaries to support progression from local schools and colleges;
  • investing in staffing, including improving student: staff ratios, often with an emphasis on particular subject areas, and explicitly linking the decision to do this with improving the student experience.

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