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Review of Higher Education Funding and Student Finance

21 May 2010

The Independent Review of Higher Education Funding and Student Finance led by Lord Browne has come at a critical time. Demand for university places is exceptionally high, while universities face a very uncertain future in terms of their funding. And while it is acknowledged that the reforms introduced as a result of the 2004 legislation have been broadly positive overall, there remains much work to be done in addressing flaws in the current student finance system, and ensuring that we have a funding framework which is durable for the future and fairer for all students.

Universities serve the needs of students, the economy, and wider society. They are net contributors to the economy, deliver the skills and knowledge needed for future economic success, and also generate substantial public benefits. In all of these spheres, requirements and expectations are changing rapidly. Universities have shown themselves to be adaptable and responsive to increasing demands in the past, but sustainable funding is necessary in order to ensure this is the case in the future.

Universities operate within a complex ecosystem of regulation and accountability, working with a large number of stakeholders, and exercising a high degree of autonomy in their governance and management. They receive state funding, but also operate under competitive pressure – more so now than ever before. These features make the university sector one of the UK’s greatest assets, delivering world-leading education for students both here and abroad. This is why we do not propose wholesale restructuring of the higher education sector in our submission – but rather, suggest that evolution of the current system through a rolling programme of reform is what is required.

The proposals we make in this submission seek to preserve and enhance what is best about the current funding system for higher education and student finance, while addressing some of its most serious problems. We aim to describe a system which is sustainable, accountable, and which can provide effectively for the future needs of successive generations of students.

Our proposals for reform, and discussion of the issues and options, are grouped into the following areas: general proposals; the graduate contribution framework; student finance; public funding; and managing student numbers. Where we believe the evidence is decisive, we have set out clear proposals. Where the arguments are less clear-cut, we have set out a discussion of the issues and possible policy options, highlighting the strengths and weaknesses of the potential choices available. We have also indicated the areas where we believe further analysis and evidence is required before any firm policy recommendations can be made.

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