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University spending growing faster than income

University income rose by only 1.4 per cent in 2011-12, while expenditure showed a 1.8 per cent increase.

Figures published by the Higher Education Statistics Agency on 7 March show that in 2011-12, total university income reached £27.9 billion, up slightly from £27.6bn in 2010-11.

But the rise in university expenditure was greater: from £26.2bn in 2010-11 to £26.7bn in 2011-12.

The percentage increases contrast with those seen between 2009-10 and 2010-11, when expenditure increased by only 1.5 per cent while income rose by 2.8 per cent.

The largest proportion of university income in 2011-12 was the 34.7 per cent from tuition fees and education contracts, up 7.8 per cent since the previous year.

Funding-body grants made up 29.6 per cent of total income, down 6.7 per cent since 2010-11. Income from research grants and contracts fell by £73.9m to £4.5bn.

Compared with figures submitted by universities last year, the total amount of research income from the research councils, the Royal Society, the British Academy and the Royal Society of Edinburgh fell by £49 million to just over £1.5bn.

Those figures also indicate that research grants and contracts from UK industry, commerce and public corporations decreased, falling by around £9m to a total of just under £285m.

However, those data show that research income from UK-based charities and the EU has increased since 2010-11. Income from charities rose by £18m to nearly £939m in 2011-12, while research income from EU sources went up by £86m to a total of nearly £600m.

The figures published by Hesa yesterday show that university income from endowments and investments saw the biggest increase, rising by 18.3 per cent to £285m in 2011-12, but only constituted 1 per cent of total income.

Of the £26.7bn spent by universities in 2011-12, £14.8bn was spent on staff costs. Academic staff costs came to £8.2bn, 30.8 per cent of total expenditure.