BIGON Sandbank

A university funding cut of £533 million has been announced by the government today.

Business secretary Lord Mandelson said the usual £7.81 billion of funding would be reduced to £7.29 billion for 2010 to 2011.

The move has been criticised for putting "severe pressure" on universities.

Lord Mandelson wrote to the Higher Education Funding Council for England (HEFCE), saying that universities should also make higher education more accessible.

Professor Steve Smith, president of Universities UK, said: "The higher education sector recognises the current pressures on public spending and is playing a key role in tackling many of the long-term challenges facing the economy.

"The confirmation that the higher education budget is going to face considerable cuts will put universities in England under severe pressure. We will need to clarify urgently whether these cuts form part of the £600 million reductions identified in the recent Pre-Budget report.

"A reduction in the public funding per student could seriously threaten our ability to offer the high-quality experience our students deserve and expect.

"The sector will not be able to deliver more with less without compromising our longer-term sustainability and international competitiveness. The government must avoid sacrificing the long-term interest in favour of short term aims."

The government is also looking at reducing the length of time students are at university, and encouraging the take-up of vocational, rather than arts, roles.

Higher education minister David Lammy said: "Over the past decade, the government has invested record amounts in higher education – around 25 per cent more than 1997 – and there are now more students than ever before in our history attending university.

"It is right that universities, in common with all other areas of public spending, play a part in helping manage the pressures on public finances brought about by the impact of the financial downturn.

"Tough choices are inevitable but we are minimising the effect on the frontline by making savings on capital budgets, asking the sector for further efficiency savings and by asking HEFCE to look to reduce funding which will not impact on teaching."