21 May 2025 
Amanda Darley, Head of Operations and Engagement
There’s definitely a lot going on at the moment! Here we go…
BUFDG
We've launched three new e-learning courses today on Conflicts of Interest, Stakeholder Relationships, and Business Analysis and Insight.
Your BUFDG Dashboard now includes ‘My CPD Events’, showing all your BUFDG CPD certificates and hours in one place, making it easier for you to complete your CPD records.
SECTOR
We start this week with an interesting piece in HEPI looking at university finance and managing the margins of error, which looks at the role of league tables, and the future of maintaining league table positions, lessons for universities on operating margins, as well as lessons for government on where to focus funding.
KPMG has been commisioned by DfE to carry out a study into the cost of higher education provision, and is looking for more providers to participate in the study. Find out more about the study, including how to participate, in this newsletter.
A lot of information on H E finance was issued in the past fortnight with the 2023-24 HESA Finance Data released and the OfS publishing its report into the financial position of (English) H E Providers. The sector position is definitely not great, though that itself isn’t news to most within the sector. There is lots of media comment on both publications, with colleagues at Wonkhe hitting most of the OfS report nails on the head and comments on DK’s article on the HESA Finance Data having the potential to get interesting. In relation to the HESA data, DK’s Wonkhe piece points out that “we are down 18 sets of accounts” (which we expect to be published in the autumn), and that when you look at which institutions have less than a month’s liquidity “there’s 10 large-ish universities in that boat including some fairly well known names”. The issues within the H E sector are frequently making it into the mainstream press these days, and the OfS report is covered by the BBC, focusing on one in four universities (in England) expecting to be in deficit this year.
After the one-day deep-dive session into the H E sector’s finances on 8 April, the Education Select Committee sent this letter to Bridget Phillipson, with a response from the Education Secretary published yesterday. The response confirms that the government will publish its plan for H E reform “as part of the Post 16 Skills White Paper in summer 2025”. It also states that the DfE is “working closely with the Competition and Market Authority to determine the extent to which the sector is facing challenges relating to competition law”, and mentions that DfE supports CUC’s review of its H E Code of Governance due to “the importance of ensuring that governance practices and arrangements across higher education are robust, transparent, and capable of responding to increasing pressures”.
UCEA has written to the unions with a full and final pay offer of 1.4% from August 2025.
AUDE recently published this guide from Provelio looking at ‘A Fresh Approach to Rationalising your H E Estate’, which covers case studies in digital and data led savings and efficiencies as ways to save money.
The FT(£) reports that the UK is set to launch a scheme to recruit global research talent after President Trump’s crackdown on academic freedoms in the US, with several other European countries launching similar schemes, including one just announced by Ireland. Said to be backed by £50m of funding, the UK scheme will aim to relocate 10 teams of researchers to the UK initially. However, since the FT reported this on 3 May with “the scheme set to be announcing in the coming days” we’ve seen no actual government announcement. Meanwhile, the Observer reports that the UK is paying the price for having the world’s most expensive visas, making it uncompetitive for recruiting overseas researchers.
The shadow Commons leader, Jesse Norman, writes in the Independent that we need more universities, but they should be “small modular reactors” which are “set up in small cities and towns across the UK to drive growth”, citing the New Model Institute for Technology and Engineering (NMITE) as an example that has given its first graduates (this year) the “hands-on skill of an apprenticeship, but also the rigour of a masters’ degree”.
The FT(£) purportedly makes the case for universities, and UUK reports on evidence that “higher education remains a powerful tool for social mobility”, for example, “comparing the earnings of people who were eligible for free school meals (FSM) at age 15 or 16, graduates earned £41,400 more than FSM non-graduates between the ages of 23 and 31”, but also looks at ways to overcome remaining barriers to access. UUK’s action plan covers four specific areas, including setting “all students up for success with an adequate maintenance package”. And while that refers to government provided maintenance, Wonkhe has examined provider-level student financial support (in England), with an overall average of £1,598 per head in 2023-24, but big differences between providers and very little uplift since 2019, and in some cases significant drops.
Erasmus+ is back! (Maybe). It could be part of the ‘youth experience’ scheme in the UK’s ‘reset’ deal with the EU, reported on by the Guardian (among others). Details of how (or if) the UK would participate in the university and vocational exchange programme are yet to be ironed out. So it’s perfect timing for the European University Association’s recently published report on the use and impact of Erasmus+, based on responses from 500 HEPs (which attest to the “the overall success of the programme”), and for HEPI’s look at the possibility of EU student fees being capped at UK fee levels once more.
A report from the Academy of Medical Sciences on Future-proofing UK Health Research makes four recommendations, including ensuring that “the true cost of excellent health research is adequately covered” (and we are pleased to note ex-BUFDG staffer Dan Wake as a key contact for this report). A report by London Economics reveals the northern N8 research partnership generated £18.8 bn for the economy in 2021-22.
Education minister Janet Daby responded to a written question on student loan fraud, confirming that “recovery will be pursued either from the institution or the student”, depending on the circumstances.
There have been a few articles recently examining the structure of the higher education system. The Chief Executive of GuildHE and the Executive Director of AHUA have called for the “era of hyper competition between universities” to end, in this Wonkhe piece, arguing that with the split of HEFCE duties into the OfS and Research England, “we have inadvertently wound up the very function that the sector and the government now need most”. And HEPI’s Nick Hillman asks in this THE article whether “properly joined-up government would help UK H E out of its crisis”, determining that “siloing isn’t necessarily bad”. He posits that “[A]n alternative positive – but unlikely – development would be for the government to knit teaching and research policy back together under one roof, allowing policy to be made with a view to protecting both” but the “most likely current outcome is one in which the Treasury continues assuming that large tuition fees from international students will bankroll UK research, while the Home Office simultaneously tries to reduce the number of international students arriving.”
Which leads us on to….
IMMIGRATION
With the big news causing a stir within the sector last week being the government’s publication of the Immigration White Paper, we’ve devoted an entire one-off (we hope!) Digest section to it this week. And of course Julia will be sticking close to this issue over the next few months as it develops, to keep members updated.
The publication of the white paper initiated a flurry of commentary in both the H E press and mainstream press outlets. Vialto held a special update session on the wider implications of the white paper and the presentation from that session is a useful explainer and UCEA members can access the UCEA Immigration Update here.
In summary, the parts which will impact the H E sector the most are:
The potential levy has garnered the most reaction, with Universities UK urging the government to “think carefully about the impact that a levy on international student fees will have on universities and the attractiveness of the UK as a study destination”, and Wonkhe’s James Coe looking at some levies around the world, discussing their various benefits and drawbacks, and DK models the potential impact across the sector. The Times(£) reports that provisional analysis shows the changes will reduce student visa applications by 7,000 a year, and post graduate visa applications by 12,000 a year, and quotes Vivienne Stern, Chief Executive of UUK, as saying “the current operating environment is very challenging” and an “additional great big fat tax isn’t going to help any university”, with Tim Bradshaw, Chief Executive of the Russell Group, saying the proposed levy “will be a serious concern for universities already making difficult decisions to safeguard their financial future”.
The statement from HEPI’s Nick Hillman covers various problems with the white paper proposals, including “concerns that some of the money raised will be siphoned off by the Treasury – just as has happened with the Apprenticeship Levy”, as well as “the risk that a levy could encourage the Office for National Statistics to reclassify universities as part of the public sector”, among other concerns about other aspects of the paper. London Higher comments that “several changes announced in today’s immigration white paper risk threatening both the country and capital’s position as a world-leading destination for international students”. And the Guardian sums it up simply as “things could fall over”, in an article covering both public sector and business, focusing on social care, hospitality, health, universities, and construction and engineering.
The Hansard of the debate on the immigration system from 12 May, includes questions on the levy from the Chair of the Education Select Committee, Helen Hayes, and other questions about higher education and universities, from others.
Following a consultation exercise, the Office for National Statistics has announced it will continue to include international students in the official estimate of long-term international migration, as students studying in the UK for 12 months or more contribute to population change and have an impact on housing and public services. 51% of responses were in favour of maintaining the current approach. The Migration Advisory Committee supports this approach, with a new report showing the share of students who remain in the UK permanently after their studies has been increasing.
Public First has released a report on research exploring “export and jobs benefits of international students in the UK”, commissioned by the University of York. It found that the gross export value of higher education from international students is £20.1bn a year, and that in 26 constituencies, higher education is the single largest export sector, supporting 183,000 jobs. While HEPI covers a report on international student experience recently published by a group of student organisations, based on surveys with 5,000 international students at Russell Group universities, which presents “a mixed picture of success and struggle”.
FUNDING
The OfS has received its funding guidance for the 2025-26 Strategic Priorities Grant and capital funding. There’s quite a lot in the guidance letter, but some points to note are: the recurrent grant is £1.347bn (a reduction of £108 million from 2024-25) and the capital grant is £84m “to support ... the government’s missions and priority sectors for growth”; there may be recovery of unused funding over the course of the year; the OfS has been asked to “reprioritise highcost subject funding away from media studies, journalism, publishing and information services courses” and target it towards “sectors that offer the highest growth opportunity for the economy and business” as set out in the 2024 Industrial Strategy; the DfE will work with the OfS to review and reform SPG funding for 2026-27. In the FT(£) Tim Bradshaw of the Russell Group calls the cuts “another blow” and Vivienne Stern of UUK says “[W]e need [the] government to work with us to stabilise the ship and put it back on an even keel. That is the opposite of what happened today”.
DSIT has announced that four innovative UK hubs in Merseyside, East Anglia, the Midlands and Northeast England will get “fresh backing to grow more spinouts” from universities and research institutions, backed by £30m of funding.
Deloitte is holding a webinar TOMORROW (Thurs 21 May) on accessing Horizon Europe funding for UK institutions (register here), as THE reports that “Europe’s main research funding scheme Horizon Europe is to remain ‘self-standing’”, confirmed by European Commission president Ursula von der Leyen, so the next seven-year funding scheme will remain standalone, rather than being subsumed into a larger scheme. UK researchers working on the latest innovations in quantum and space technologies have now been given access to more Horizon Europe funding, under the new 2025 Horizon Europe Work Programme. This includes complete access to all Horizon Europe quantum funding calls, including the c.£80 billion Horizon fund, and consortia with research partners across Europe, and beyond.
The Lords Science and Technology Committee has finished its oral evidence hearings as part of its inquiry into ‘Financing and Scaling UK Science and Technology: Innovation, Investment, Industry’, and has published all the oral and written evidence it received (or you can watch the hearings back on parliamentlive.tv).
The Institute for Fiscal Studies is holding a webinar on 2 June to look ahead to the Spending Review, due to be announced on 11 June, and is holding a webinar to analyse the Spending Review on 12 June.
SCOTLAND
Wonkhe reports that the SFC’s publication of financial sustainability analysis for Scotland’s universities is expected imminently (but sadly not before we published the Digest)…
The Scotsman reports that the UK government’s proposed changes to visas and immigration will be “deeply damaging” to Scotland’s universities, according to the education minister, Graeme Day. While the Herald(£) estimates that if the proposed international student levy applies in Scotland it would cost Scottish universities £58m.
The Scottish Government has announced that postgraduate social work bursaries will increase to £11,000 from £7,415.
WALES
Medr has launched a consultation on a new regulatory system, including conditions of registration and funding. The consultation closes on 18 July.
Ahead of today’s hearing on H E sector issues, Medr provided a briefing to the Senedd education committee, stating that the Welsh H E sector “is operating in an ‘exceedingly challenging financial environment’”, with six universities having announced voluntary severance schemes, and six having “a high exposure to any issues around international recruitment”. However, Medr has said it doesn’t think any institution is at “imminent risk of failure” (in the next twelve months).
Medr has also published a breakdown of the Welsh H E sector’s finances, based on last week’s HESA data release.
NORTHERN IRELAND
The BBC has reported that Caoimhe Archibald, Northern Ireland economy minister, “will not be increasing university tuition fees above the usual level of inflation”. It follows the BBC’s previous reporting of calls from Northern Ireland’s universities for increased tuition fees, with students speaking out against any increases, and the president of NUS-NI saying that with nearly one in five students using a foodbank, "We can't be putting more burden on students at a time like this."
FINANCIAL REPORTING
The consultation on the draft SORP closed on 30 April, with 31 responses received. The Technical Working Group are considering responses and proposed updates to the exposure draft. All responses to the consultation will be published, along with a summary report outlining the proposed changes to the exposure draft, in June at which point the final approvals timeline is expected to start with the SORP Board (June) and FRC (July) ahead of the expected publication date on 1 August. Any change to this timeline will be widely communicated.
Over 200 attendees from across the tertiary sector joined the ‘Preparing for SORP’ webinar hosted by KPMG’s technical advisory team to learn more about the most crucial updates, the implications of the changes, and strategies for addressing them. A recording of the webinar is available on BUFDG’s SORP knowledge hub. For BUFDG members looking to explore the SORP implementation in more detail it's not too late to join a regional half-day workshop in some parts of the UK. Leeds and Edinburgh have already taken place, but spaces are still available for Birmingham (3 June), Bristol (5 June), London (9 June), and Belfast (10 June).
The Financial Reporting Council has published stakeholder insights on the future of UK digital reporting, outlining support for digital reporting and the collaborative approach needed to address the challenges in the next phase of digital reporting in the UK.
TAX AND PAYROLL
The final countdown to the BUFDG 2025 Tax Conference is on, and we look forward to two days of all things tax in Birmingham on 11 and 12 June 2025. Bookings have now closed, but we are still seeking nominations for our Annual Nigel Clothier Award and Lifetime Achievement Award. It’s a wonderful way to celebrate the achievements of some of our members, and you can participate even if you are not able to make this year’s event.
We’ve published a guide to the sometimes complex area of Terminations Payments. It provides information on how to identify each element of a termination package, and apply the tax legislation, including any reporting requirements, and calculation of the Post-Employment Notice pay. (It focuses purely on tax and does not include requirements around employment law, e.g. whether terminations are genuine redundancies situations, etc.) The guide also includes a number of illustrative examples and a glossary of relevant terminology.
With potential big changes around immigration, see the links to various commentary and guidance on the Immigration White Paper in the ‘Immigration’ section above.
You can find all the latest H E tax and payroll news in last week’s TaxHE.
PROCUREMENT
The Procurement Value Survey (PVS) Results Report for the Financial Year 2023/24 has been released - 76 responses were received with a total impactable spend of £8.3bn, and total gross efficiencies of £354m. The PVS gathers institutional efficiency data in from English and Welsh Higher Education Providers in line with the sector Benefits Methodology.
Thanks to those who have already completed the Innovation Procurement survey – the survey is open until the end of this week. Thanks also to those who have completed the KU Leuven Ethical Procurement survey which closes for responses at the end of the month. There’s still time to contribute to both surveys if you haven’t yet managed to do so.
SUSTAINABILITY
The first recipients of Phase 4 Public Sector Decarbonisation Scheme grant funding have been announced, with 17 universities and university hospital trusts listed. Phase 4 closed to new applications in November 2024, and some successful projects are yet to be announced. Future rounds are expected, with funding up to £86 million for 2025-26, up to £427 million for 2026/27, and up to £427 million for 2027/28.
Salix has released two guidance videos for those applying to Phase 2 of Scotland's Public Sector Heat Decarbonisation Fund, providing a walkthrough of the application form and specific guidance for step 4 to show how you should approach gas sequencing within the application. The application portal will close at 2pm on Tuesday 27 May.
The Department for Energy Security and Net Zero and Department for Business, Energy & Industrial Strategy released a short update confirming the opening date for Round 10 of the Heat Network Efficiency Scheme will be announced ‘shortly’ and will close on 19 September. It was also announced that there will be no funding for the Public Sector Low Carbon Skills Fund in financial year 2025/26.
RESEARCH FINANCE
UUK has written to the Chancellor of the Exchequer about research and how it contributes to growth, and sets out various requests for the upcoming Spending Review, including a real-terms increase to QR funding.
See the 'Funding' section above regarding Horizon funding, including a webinar TOMORROW.
The next Research Finance Forum is coming up on 11 June, online 1.30-3pm. You can highlight any topics you would like on the agenda when you book your place. As part of the ongoing work of the Forum, two task and finish groups are planned: one on preparing standard responses to Innovate monitoring officer queries in an FAQ type document - if your funding portfolio includes considerable Innovate UK activity and you would like to volunteer please let Joni know, specifying Innovate UK; the other group will look at possible ways we can charge facilities (e.g. High Performance Computing) to grants as DI rather than via TRAC facilities DA route. Contact Joni if you would like to volunteer, specifying facilities.
ARMA and UUK colleagues have been supporting the Department for Science, Innovation and Technology (DSIT) to reduce unnecessary research bureaucracy in the UK. The Bureaucracy Reduction and Research Innovation Network (BRRIN) focuses on funding assurance requirements, reporting the impact of research, funding applications and assessment, and digital tools and databases used in monitoring, evaluation, and reporting. Working with UUK, ARMA is keen to highlight current activity undertaken by members to reduce bureaucracy in these areas. If your organisation has made changes to improve efficiency, please get in touch via this form. ARMA and UUK will share key learnings with the research community. Examples may also be collated to share with Government and the sector.
The National Audit Office has published a report on specific aspects of how UKRI operates its competitive grant funding. It finds that UKRI has supported a globally respected research and innovation system, but faces challenges including a lack of joined-up direction from government departments, inefficient data systems, and the need to consider how to further support well-managed risk taking through organisational culture.
The Professional Doctorates Survey has released initial findings which indicate that the professional doctorate continues to be attractive. The full report is due Autumn 2025.
MISCELLANEOUS / JOB OF THE FORTNIGHT
For some light relief, or if figuring out the finances for your university is not enough for you, you can try your hand at being the Chancellor, as the IFS interactive tool is back, allowing you to set spending plans and tax policies for the whole country (and see the impact).
As well as the regional FEHE SORP workshops, we have lots of events coming up in the next few weeks, including an online ‘deep dive’ into China (and tax) on 27 May, our Deputy FDs group meeting for Scotland (online) on 28 May, finance business partnering foundations training on 4-5 June, and strategic finance business partnering training on 18-19 June. And there are plenty more events on our events calendar!
Our jobs of the fortnight are with APUC in Scotland, who are looking for a Procurement Project Manager based in Dundee and Tayside, and a Procurement Manager (ICT) based at Glasgow Caledonian University. Closing dates are 8 June and 30 May respectively.
