There will be few favours for universities from this year’s budget.

The Department for Innovation, Universities and Skills (DIUS) is to save £400 million in spending cuts, euphemistically termed ‘efficiency savings’.

The government also plans to save about another £300 million from other areas, such as cutting costs from Research Councils, which fund research and training with tax payers’ money. Meanwhile, they claim they will increase their spending on science by 6 per cent.

The chancellor did manage to find £250 million for sixth form colleges, who faced a similarly-sized hole in their budgets after underestimating the number of students who wanted to stay on at school.

The budget follows the government’s decision to offer just 10,000 new university places this year. UCAS, the admissions service, recently reported that over four times that amount – 42,367 – more applications over last year had been received, bringing the total number of applicants to just under 525,000.

It is thought that this is to limit the government’s spending on student loans which, at a minimum, cost them £3,000 per student, per year, for tuition fees. The vast majority – 80 per cent – of students apply for maintenance loans, which average about £3,500 per person.

Last year the Government made fewer students eligible for grants which, unlike loans, are not repaid. This is expected to save £100 million. Only new students will be affected, not current ones.

Earlier this month The Times reported that John Denham, the universities secretary, had threatened vice-chancellors with financial penalties should their institutions offer more places.

Rick Trainor, the president of Universities UK, a higher-education lobby group, said they were “disappointed there has been no rethink on the current restriction on student places in higher education.”

However, he praised the “budget’s commitment to improving the UK’s skills base” during the recession and said that he thinks “universities will play a key role in delivering on areas such as green technology.”

Professor Les Ebdon, chair of Million+, a universities think-tank, said that after years of investment in higher-education “the government’s long term strategy… is about to come unravelled because the chancellor has not provided funding for the thousands of additional students who are applying to university to improve their life chances post-recession.”

More at: the Guardian

By Rob Wells

Rob is a third-year journalism student at the University of Lincoln, and is originally from Leicester. He also writes on his website.