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Allocation of funds for additional student numbers in 2009-10 and 2010-11

March 2008 | ref: Circular letter 05/2008


Heads of HEFCE-funded further education colleges, Heads of HEFCE-funded higher education institutions, Heads of universities in Northern Ireland

Dear Vice-Chancellor or Principal

1.   This letter sets out how we will allocate fully-funded additional student numbers (ASNs) for 2009-10 and 2010-11, and the allocation of resources to support increased growth in provision co-funded by employers. Institutions are invited to contact their regional consultant or regional adviser in the first instance to discuss their requirement, from 1 April 2008.


2.   In its grant letter to HEFCE in January the Government set out funding available for growth in the higher education (HE) sector over the Spending Review period 2008-11. This funding will allow the allocation of approximately 60,000 fully-funded full-time equivalent students (FTEs) over the period until 2011. We have already allocated a significant number of ASNs for growth in 2008-09 in anticipation of funding to be made available during the current Spending Review period (HEFCE Circular Letter 04/2007) which, together with funding made available from holdback, is sufficient to meet the Government's student number plans for 2008-09. Because of this commitment, and given our normal timetable for allocating ASNs in advance of an academic year, we will not seek proposals from institutions for additional fully-funded ASNs for 2008-09.

3.   As a result there are around 40,000 ASNs for allocation to support future strategic growth, which we will allocate for 2009-10 and 2010-11 to meet the policy priorities set out below.

Priorities for growth

Specific priorities

4.   In allocating ASNs, we aim to meet a number of policy priorities identified in the grant letter and which are closely aligned to our strategic policy objectives and priorities for growth across the HE sector. Due to the limited numbers available, we will allocate fully-funded ASNs primarily against five key priorities:

  • funding growth to complete business plans of currently funded Strategic Development Fund (SDF) projects to ensure that these are sustainable;
  • foundation degrees;
  • Strategically Important and Vulnerable Subjects (SIVSs) particularly science, technology, engineering and mathematics (STEM) subjects;
  • priorities within the healthcare sector;
  • areas where new HE provision is required.

5.   Following the same approach to allocating ASNs as last year (set out in HEFCE Circular Letter 04/2007) we wish to include as a priority, allocations for growth to large-scale strategic projects previously funded through our SDF to enable these to deliver their business plans and to support their sustainability. In providing growth for these projects, we will give a higher weight to proposals where developments can also meet the other priorities we have identified.

6.   We also aim to expand the development and take-up of foundation degrees to meet the Government's target of at least 100,000 by 2010. We will also continue to prioritise growth to support SIVSs, particularly those in STEM where there is evidence of demand.

7.   The Department of Health has asked HEFCE to accommodate the following growth priorities for healthcare related HE provision, which are intended to address skills shortages throughout the NHS and social care and support strategies for workforce modernisation:

  • foundation degrees and degrees in healthcare science;
  • foundation degree for paramedics;
  • post-qualification training in social work at undergraduate and postgraduate level.

Proposals for growth in these areas will need to demonstrate evidence of support from partner NHS Trusts and relevant employers. Where appropriate, we would also expect evidence of support from strategic health authorities and/or local authorities.

8.   We will also be allocating growth in the context of our work on addressing areas where new HE provision is required. For further details see the Department for Innovation, Universities and Skills (DIUS) new proposals in 'A new "University Challenge"'. We will publish a consultation on these proposals by early summer.

Cross-cutting themes

9.   We have also identified the following themes as being of high importance. We will give a higher weight to proposals which, in addition to addressing one of the priorities listed in paragraph 4, address these themes.

10.   We will give higher weight to ASN proposals that advance our widening participation agenda. Some of the aspects that would attract higher weighting are where:

  • processes are adopted for provision that may be particularly successful in attracting and retaining disadvantaged students, such as inclusion of outreach activities;
  • ambitious targets are set to enable higher numbers and proportions of disadvantaged students to be accommodated;
  • proposals demonstrate close alignment to the institution's widening participation strategy, and a commitment to how this will lead to a step-change in admissions from under-represented groups;
  • proposals build on the work of Lifelong Learning Networks to enhance provision and widen access.

11.   In line with guidance received in the January grant letter to us, when weighting ASN proposals we will also take into account the impact on higher education institutions (HEIs) caused by the withdrawal of funding for equivalent or lower qualifications (ELQs). In such cases, institutions will need to provide a robust business case outlining how they will meet priorities for growth as set out in paragraph 4. Also, all proposals for ASNs will need to meet requirements for students to be recorded as HEFCE-fundable in HESES08 as included in the ELQ guidance (HEFCE 2007/27).

Approach to allocating ASNs

12.   To keep burden to a minimum, we propose to streamline our approach to distributing growth and allocate all ASNs through a single route - that is, using the established approach and processes of the SDF. Evidence from evaluations has shown that the SDF is robust and effective in meeting our priorities alongside those of the sector, and we are confident that it will be able to deliver the same benefits to allocating growth, including meeting regional priorities.

13.   The broad criteria and priorities established for the SDF would continue to apply for ASNs attached to development funding as part of a project, whereas proposals seeking ASNs-only would need to comply with the approach described in paragraph 4 in meeting at least one of the five key strategic priorities. We propose to enable institutions to access growth either through seeking ASNs as part of a strategic project (continuing our present SDF method), or institutions seeking ASNs-only. Both routes will follow the standard SDF formal processes; however the templates will be adapted for institutions seeking ASNs-only by using a simplified format (see paragraph 21).

14.   We expect that cases for ASNs-only will be strategic - that is, proposals would set out explicitly how the allocation will address and deliver priorities and provide detail of the delivery and outcomes of provision.

15.   In line with SDF practices, we would aim to allocate ASNs over the Spending Review period on a rolling basis and not through a single, one-off competition.

16. Proposals for ASNs, whether linked to an SDF project or not, should be developed through discussions between institutions and the HEFCE regional teams. The role of the regional teams will be to engage closely with institutions on their requirements for growth, and to manage a holistic view of how allocations of ASNs will aim to meet our priorities, and regional and institutional priorities, over the longer-term. As part of this, we will keep in mind how new proposals complement initiatives from neighbouring institutions in meeting regional demand and priorities (as we do with SDF generally). In advising institutions on whether a case for growth is likely to be supported, regional teams will take into account an institution's track record in recruiting ASNs, the relevance of the bid within the context of the institution's overall strategic direction, and the level of commitment made by the institution. As with SDF, we will also consider risk in assessing proposals.

17.   Where an HEI wishes to seek ASNs as part of an SDF project, the standard SDF guidance (HEFCE 2007/22) applies (including the criteria established for the SDF); therefore only HEFCE-funded HEIs are eligible. However, further education colleges (FECs) with over 100 directly-funded FTEs will be eligible to develop proposals for ASNs-only. Indirectly funded FECs and those with less than 100 directly-funded FTEs should consider growth through their LLN partnerships. More generally we will seek to support growth in FECs through proposals put forward by LLNs.

18.   We wish to link ASNs to wider developments of the institution, region or sector (as well as meeting the priorities identified in paragraph 4). Hence we would give a higher weight to larger scale ASN proposals which represent a coherent, strategic whole targeted on a specific area of provision, as opposed to one comprising an amalgamation of requests for small numbers distributed across a range of subjects, modes or courses. Recognising that demand tends to outstrip available numbers, we will not normally accept proposals from institutions that ask for more than 500 FTEs, whether this is for an individual HEI or in a single case covering a partnership of institutions. We also wish to ensure a fair spread of ASNs, and hence our regional teams will keep an oversight of the total numbers of ASNs that any single HEI may be benefiting from, across a number of cases, over the funding period.

19.   In essence, institutions will be able to put forward proposals for strategic growth on a rolling basis. This will provide us with increased flexibility to respond to priorities as and when they arise over the longer-term. In the present Spending Review round, and to ensure that ASNs available are distributed strategically over the two-year period, we anticipate holding back a proportion of the total ASNs to ensure that numbers are available in the later part of the period for emerging priorities and opportunities. This approach will result in a more continuous flow of ASNs without the disruptions of Spending Review periods, and enable more effective strategic planning of our ASN activities over the longer term. It will also mean we can make available any recycled ASNs from under-recruitment in any year as part of further strategic growth in the sector, as we have done in previous years. Our ability to maintain the flow of growth in the longer term though ultimately depends on the availability of funded numbers made available by the DIUS.

20.   We urge institutions therefore not to approach us immediately with cases for growth that may have been constructed with the short term in mind. Our preference would be to use ASNs over the whole period, working alongside institutions so that cases are strategically sound and timely.

21.   We will accept new proposals for ASNs (either linked to an SDF project or alone) from 1 April 2008. Details of the standard SDF process are available on our web-site under Finance & assurance/Finance and funding/Strategic Development Fund. Institutions that are currently preparing an SDF bid should continue to do so, following the SDF timescales for submissions. HEIs or FECs seeking to put forward proposals for ASNs-only should seek advice from their regional teams, and use the templates provided below.

22.   We will approve all proposals for ASNs through the established processes for SDF as outlined in HEFCE 2007/22 with the chief executive making decisions on small scale and lower risk proposals roughly monthly (at meetings of HEFCE's chief executive's group), and larger scale and higher risk proposals going to the SDF Panel (meeting quarterly) or even the HEFCE Board. Our regional teams will advise on approvals routes and timings. We would also not normally expect to consider proposals for ASNs after February of the start of the relevant academic year.

Requests from Lifelong Learning Networks (LLNs)

23.   LLNs have begun to facilitate genuine progression opportunities for learners on vocational programmes, and offer significant further potential in ensuring widespread HE engagement with 14-19 curriculum developments, credit transfer, and employer engagement. Therefore, all LLNs may continue to apply for further ASNs as a collaborative partnership where they meet one of the core criteria identified in this circular; and can show evidence of progress with assurance that core commitments are sustainable. LLNs are at various stages of implementation and currently attract ASNs under one of two models of allocation (see www.hefce.ac.uk/widen/lln/monitoring). Where LLNs are still within their initial SDF funding period, they may continue to request that ASNs are allocated outside of the mainstream funding (model 2). Current model 1 LLNs cannot opt for further ASNs to be allocated through model 2. Where LLNs wish to apply for ASNs for a period which extends beyond the initial SDF funding period, these will only be available through the mainstream (model 1) route. LLNs would still be expected to identify these learners on the HESA/ILR record in line with previous guidance. In all cases, requests should be directed to the HEFCE regional team through the lead HEI on behalf of the whole LLN partnership/steering group. LLNs will also be eligible to apply for co-funded ASNs and individual institutions within LLNs will also be able to make additional, separate bids.

24.   Following the Government's announcement on priorities and additional funding for employer engagement, we will allocate at least £105 million over 2008-09 to 2010-11 to support growth in provision co-funded by employers and infrastructure developments that will increase the sector's capacity to deliver this growth.

25.   HEFCE Circular Letter 04/2007 invited institutions to bid for additional student numbers that are co-funded by employers. The higher education sector has responded positively, with a number of projects already supporting employers' workforce development needs at Level 4 and above. Summaries of projects currently funded are on our web-site under Learning & teaching/Employer engagement. We anticipate that these projects and project proposals already discussed with HEFCE will help us to deliver the challenging targets set by the Government.

26.   We are developing more flexible funding arrangements to help institutions respond to the fluctuations of the employer market. Further details will be available from HEFCE regional teams in due course. We are also working with a range of partners to highlight the employer engagement activities of institutions and to disseminate emerging practice.

Yours sincerely

Professor David Eastwood
Chief Executive


SDF summary case - additional student numbers only

Download the cl05_08template as MS Word (72 KB)

Annex A – ASN spreadsheet

Download the cl05_08a as MS Excel Spreadsheet (62 KB)

Enquiries should be directed to:HEFCE regional consultants or regional advisers

Page last updated 30 August 2012

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