Global trends in higher education financing: The United Kingdom

Over the last 40 years, UK higher education has moved from a publicly funded system to a mixed publicly/privately funded system regulated as a tuition loans-based consumer market, in which both the student as graduate, and the higher education institution, are responsible for a significant proportion of total costs. It is nevertheless subject to robust government control. This is partly exercised indirectly through comparative assessments of institutional performance by public agencies that define common objectives and install a hierarchy based on measured performance, helping to differentiate HEIs within the market. Institutions remain partly dependent on government funding in the forms of research-related support, teaching subsidies and subsidization of the loan system through non-repayment of debt. The 2012 introduction of a £9000 maximum fee for full-time students and £6750 for part-time students in England, based on income-contingent repayment arrangements, was associated with a net increase in funding, growth in full-time first degree students, and a sharp fall in part-time and mature age students. Part-time students begin repayments four years after the commencement of their course of study. The long-term cost of the student loans scheme is uncertain and its sustainability is in question. After 15 years of declining funding for students, total systemic funding rose by 50% between 2000 and 2015 and per student funding also rose, mainly benefiting the research-intensive universities in the Russell group. These universities benefit most from funds allocated through the government’s periodic national research assessments.