Government control issues for HEFCE
According to a recent report in Times Higher Education HEFCE still fears government’s controlling hand over its budget despite its status as an “arm’s-length” public body:
Newly published Hefce board papers reveal internal fears about its ability to “maintain the standard of its work” and its relative independence given the pressure from ministers to cut its running costs. Hefce is making efficiency reductions of £2 million – amounting to a real-terms cut to its administration costs of 11 per cent this year – to help the Department for Business, Innovation and Skills save £836 million in 2010-11.
During a meeting on 25 November, the body’s audit committee said it was worried that the “continued pressure” to reduce running costs would have a serious effect as it helps universities manage the changes to funding and the introduction of higher fees.
“We expressed our concern about the capacity and capability of Hefce to maintain its standard of work over the medium term when faced with continued pressure to reduce administration costs,” a report of the meeting says.
“We also noted with concern the level of control imposed by BIS over Hefce and the potential impact on its governance and management.”
Whilst it is important that the Funding Council is not protected from the cuts facing the sector, nevertheless it is a reasonably lean and efficient organisation already. So the Council’s ability to maintain its capacity is something to be watched. However, the real concern here is that government uses the opportunity of funding reductions as a lever for greater direction and control over the business of HEFCE and the sector. It would perhaps be surprising if BIS did not seek to exert greater control in the current climate with the significant changes and challenges facing the sector. However, this environment means that, perhaps more than ever, the sector needs a helpful funding council to support an intelligent approach to 2012 and beyond, whatever government thinks.
So, the fear is not misplaced but there will be big challenges ahead, for HEFCE as well as universities. Part of the response has to be to minimise the unnecessary intervention and direction from government both at HEFCE itself but also more across institutions.