Most universities in Wales will see a small rise in funding for the next academic year because of the income that will be generated from higher tuition fees.
But, in contrast, Glyndwr University will see a 20% cut in its budget. Figures from the Higher Education Funding Council for Wales (Hefcw) show core funding to each institution dropping by an average of 37%. But the balance is being made up by millions of pounds in student fees.
In three universities, income from fees will be higher than the funding allocated to them by Hefcw in 2012/13. The change in the level of tuition fees each university can charge has led to the new funding arrangement. From September 2012, universities will be able to charge students up to £9,000 for their courses. Eight out of 10 institutions have opted to do so.
Most students from Wales will pay the first £3,400, and the Welsh government will pay the remainder of their course fees wherever they choose to study through fee grants. The Hefcw figures show the policy will cost £111m in 2012/13, but that figure will rise over the next three years.
Hefcw estimates that in return, the universities will benefit from approximately £55m from increased tuition fees paid by students from the rest of the UK.
Prof Philip Gummett, chief executive of Hefcw, said: “The new system should mean that overall investment in higher education in Wales will increase from 2012/13, which will benefit students and staff, and should have a positive impact on courses and research.
“The whole public sector remains in a challenging funding environment, but we are confident that Wales’ universities will continue to offer the student experience for which they have been so often commended.”
But the president of the Learned Society of Wales, which aims to encourage academic excellence, believes the funding system will prove a “gamble” for the Welsh government.
Sir John Cadogan said: “Part of the funding policy of the Welsh government is to allow Welsh domiciled students to have a very large fee subsidy and this cost is coming off the money which would’ve gone to universities, so they’re gambling, and we use this word gambling advisedly.
“They’re gambling that they’re going to be able to attract lots of English or foreign students in, to balance the Welsh students who’re leaving.”
Glyndwr University said it was “disappointed” that, in contrast to other universities, it will see a 20% cut in its budget. It chose to charge an average fee of £6,643 for 2012/13. Professor Michael Scott, vice-chancellor and chief executive of the university, said: “Naturally, the university is disappointed at the announcement. However we were anticipating a reduction on this scale and have been planning for it for some time.
“When setting fee levels for students for 2012/13 we deliberately opted for fees which would lessen the burden of debt on our students and the Welsh government while at the same time meeting the social justice and economic development aims of the Welsh government. “It is a shame therefore that the university is being disadvantaged compared to other universities for following government policy.”
Higher Education Wales, the representative body for universities in Wales, says it is not yet clear exactly what the impact of the new funding arrangements will be. Director Amanda Wilkinson said: ‘”We will be looking at the funding allocations for 2012/13 carefully in the next few days.
“It is important to remember that this is the first year of the new arrangements in which much more of the funding for institutions will come from student fees supported by loans or fee grants. She said this was the first of a series of changes for higher education funding in Wales and across the UK and the full impact of these changes would not be known for months.
A Welsh government spokesperson said: “The new fee regime being introduced in higher education from 2012-13 will result in higher funding overall for HEIs (Higher Education Institutions) in Wales. “This has been achieved against a backdrop of funding cuts to Wales in the UK government’s last spending review.
“We remain committed to the provision of high quality higher education in Wales. However, in the current economic environment it is essential that the Welsh HE sector maximises the return on the significant public investment made by the Welsh government, delivers change and seeks efficiency savings.”