The University of Lincoln is discovering for the first time the cost of the government’s higher education funding cuts, following a letter from the Higher Education Funding Council for England (HEFCE).

Sir Alan Langlands, chief executive of HEFCE, wrote to vice-chancellors, highlighting the specific areas of the budget which will be cut. These include a 1.6% cut in funding for teaching, as well as 14.9% and 7% cuts in capital funding and special funding for national programmes and initiatives, respectively.

The cuts are as expected, says Professor Mary Stuart, Lincoln’s vice-chancellor. “The real issue for us, and all the sector, is what cuts are down the line next year as we cannot predict exactly what will happen following the election, but it is likely these will be more severe. We are working hard to ensure we are in a strong position to manage any further cuts by developing other revenue streams through work with business, research and recruiting additional students where we are able to do so,” Stuart says.

The university claims that no job losses or cuts to student services feature in their plans. They also say that funding for their various projects is secure. Last week they denied there are funding problems for the new Business and Law Faculty building, after a university insider told The Linc that they lack the cash to complete the project.

Sir Alan’s letter also threatens fines for universities who over-recruited in their student intake for 2009-10. He says HEFCE’s latest budget accounted for a £10 million income from these fines. Lord Mandelson, the government’s business secretary, told HEFCE to fine universities £3,700 for each student over the recruitment limit.

The University of Lincoln has previously told The Linc that it hasn’t over-recuited. Scott Davidson, pro vice-chancellor for external affairs, said: ““According to the data we have we are well within our student population.”

However, Stuart couldn’t rule out fines for the university. She says: “The university is currently in discussion with HEFCE about its recruitment for this year so at this stage we are unable to comment on whether there will be a fine for over-recruitment or not, as in other institutions.”