16 December 2022

‘We are disappointed to see that the Draft Budget 2023-24 does not reflect either the financial challenges facing our universities nor does it provide the support needed to ensure that our universities are able to bring investment to Wales and deliver for communities.  

‘The most recent analysis of university finance shows that fees and grants no longer cover the cost of teaching UK students or the cost of research and innovation activity. Both teaching and research, which are crucial to Wales’ future prosperity, are now reliant on international activity. At the same time, Welsh universities are having to manage the loss of EU Structural Funds which provided around £50m a year of support to projects that have benefitted people and businesses across Wales.  

‘Substantial increases to funding elsewhere in the UK present an even greater challenge for our universities as they compete for UK-wide funding. It is crucial that additional funding generated by these increases be used to ensure Welsh universities can operate on a level-playing field.  

‘Against this backdrop and the cost of living crisis, universities are making additional provision for students who do not have access to government support in the same way as other groups. This includes increases in hardship funding and other support packages.’  

‘Wales faces many challenges including achieving net zero, preparing for the impact of technological change on the workforce and addressing the impacts of the cost of living crisis. Universities have a key role to play in responding to these challenges. The financial pressures we now face put at risk our ability to respond.” 

Note to editors 

  • Universities Wales represents the interests of universities in Wales, and is a National Council of Universities UK. Universities Wales’ membership encompasses the Vice Chancellors of all the universities in Wales, and the Director of the Open University in Wales. Our mission is to support a university education system which transforms lives through the work Welsh universities do with the people and places of Wales and the wider world. 

  • The Draft Budget for 2023-24 shows the allocation for higher education being reduced to £198.7m, £4.8m lower than the £203.5m in the Draft Budget for 2022/23.  

  • Although £1.6m of this reduction appears to have been transferred from the higher education line to Taith, the overall reduction still presents a substantial real-terms decrease to the resource available to Welsh universities at a time of increasing costs.  

  • This is against a backdrop of substantive increases in equivalent funding elsewhere in the UK. For example, Quality related research funding (QR funding) in England increased by 10% from £1,789,000 to £1,974,000 this year. It has since increased further as a result of a £100m uplift in Research England funding as a result of the delays in Horizon Association and a further increase of £31.4m in supplementary QR funding.  

  • QR funding is essential in enabling universities in each nation to be able to compete for UK-wide funds.  

  • Crucially, Wales already had a proportionally lower level of QR funding when compared to the rest of the UK  
     

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  • There are a wide array of pressures facing universities. Students are contending with a cost-of-living crisis which means 91% are worried about living costs, according to recent ONS data. There is also currently a UK-wide dispute with staff regarding pay. UCEA is the body which conducts collective pay negotiations in UK HE and more information can be found here. 

  • Welsh universities have also experienced significant cost increases as a result of pensions. For example, USS employer contributions increased from 14% in 2009 to 21.4% in 2021; TPS from 16.4% to 23.6% in September 2019. 

  • At the same time, Welsh universities are having to manage the loss of EU Structural Funds which, in the last funding period between 2014-2021 had provided around £350m to projects in which universities were lead partners. Welsh universities are now facing a cliff edge with the loss of this funding. 

Media contact

Jodi Cox
press@uniswales.ac.uk
07788 270407