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Universities set out case for investment pre-Budget

25 June 2015
HM Treasury

In the run-up to the emergency Budget on 8 July and the spending review in the autumn, Universities UK has called on government to invest in higher education and research.

Setting out its case in a new document published today, Universities UK warns that the UK’s world-leading universities and internationally-renowned research will fall behind key competitors without sufficient and sustained investment.

The document highlights also how universities are delivering an impressive return on public investment, making a major contribution to the economy and boosting jobs, skills and productivity in all parts of the UK. But it argues that it will not be possible to sustain this positive trajectory in the long term, unless investment in higher education is maintained.

The document sets out a number of arguments why government should invest in higher education. They include:

  • Universities boost local economies, innovation and jobs in all parts of the UK. Universities are often the largest employers in their locality and many jobs are dependent on the expenditure of universities and their students

  • Employers increasingly need recruits with higher level skills. By 2022 there will be 2 million additional jobs in occupations requiring higher level skills

  • International higher education is one of the UK’s leading exports, with earnings estimated at £10.7 billion in 2011

  • The UK has invested significantly less in research as a proportion of GDP than many other countries and significantly below the OECD and EU averages. The UK’s total research and development (R&D) expenditure was 1.72% of GDP in 2012. In comparison, in 2012 the EU-28 provisional estimate was 2.06% of GDP and the OECD average was 2.4%. Countries such as Germany and France have consistently invested more than 2% of their GDP in R&D and aim to increase this to 3% or more in the future

  • Universities have already achieved significant cost savings, ensuring they spend every pound effectively and efficiently. In England, universities have consistently met efficiency targets set by the government. Between 2005 and 2011 they reported £1.38 billion of efficiencies against a cumulative target of £1.23 billion

  • There remain uncertainties around funding for learning and teaching in England. With the tuition fee for undergraduate students from the UK and the EU capped at £9,000, its value is being eroded considerably by inflation

 Professor Dame Julia Goodfellow, Chair of Universities UK's Comprehensive Spending Review group, said: “With the Budget on 8 July and the government’s spending review coming in the autumn, it is vital that we set out now the importance of significant investment in higher education.

“The chancellor George Osborne has referred previously to UK universities as the ‘jewels in the crown of the British economy’. With skills, jobs, productivity, education and research high on the government's agenda, it is clear that universities have an important role to play in this aim. But they can only do this if they are properly funded.

“There remain a number of major financial challenges for universities that must be overcome. In particular, it is important that the student funding system is financially sustainable and supports accessible, high-quality higher education.”


    1. The document – Why invest in universities? ​

Key Contacts

Gareth Morgan

Gareth Morgan

Media Relations Manager
Universities UK

Clara Plackett

Clara Plackett

Press and Social Media Officer
Universities UK


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