Spending on UK higher education rises by 6%

Tuition fee income increases sharply as funding council cash declines, latest sector-level data shows Spending on UK higher education providers increased by 6 per cent in 2014-15 to £31.2 billion, new figures show.

Details of the latest increase – worth around £1.8 billion in total – were released by the Higher Education Statistics Agency, which indicates the sector's total income grew even faster.

Some £33.2 billion in income was received by UK higher education in the last full academic year, up from £30.7 billion in 2013-14, an 8.1 per cent rise, the latest Hesa information published on 28 April shows.

That came despite a reduction in income from funding council grants, which accounted for £5.3 billion in 2014-15 (17.2 per cent of total income) compared with £6.1 billion (19.8 per cent of total income) in 2013-14.

Monies from tuition fees and education contracts (£15.6 billion) were significantly up on 2013-14 (£13.7 billion) – with just over a quarter of this (27 per cent) coming from international students (£4.2 billion).

International fee income accounted for 12.7 per cent of the sector’s income – the same proportion as in 2013-14, though the total income was 8 per cent higher in actual terms (£3.9 billion was raised in 2013-14).

Income from research grants and contracts (£5.9 billion) is now more than that awarded by funding councils (£5.3 billion), which just five years ago were the largest source of funding for higher education (handing out 33.7 per cent of all income in 2009-10).

The total amount of money received from European Union sources was £836 million (2.5 per cent of all higher education income) compared with £789 million in 2013-14 (2.6 per cent).

On expenditure, some 55 per cent of money went on staff costs (£17.1 billion) compared with £16.3 billion in 2013-14 (55 .4 per cent).

Some £3.6 billion was spent on university premises and £1.6 billion on residences and catering operations.