Introduction - Finances 2015/16
This commentary draws attention to some of the headline figures and key points that emerge from the introduction tables and is displayed graphically where appropriate. It should be noted that accounting standards for higher education providers changed for 2015/16 so this year's data is not comparable with previously published HESA finance data. HE providers submitted re-stated figures for 2014/15 based on the new standards, but transitional changes are reflected in these figures so they should be interpreted with caution.
It should also be noted that in all tables, The Open University is counted as an HE provider based in England, although its funding now includes contributions from other administrations. All HE provider tables include finance data for The University of Buckingham, which is a non-publicly-funded HE provider in England and operates on a different financial year from the 1 August to 31 July financial year standard for the rest of the sector.
Data for this publication has been extracted from the latest or most appropriate HESA datasets and may differ from HESA data published elsewhere.
A comparison of the HE sector’s balance sheet at 31 July 2016 with that at 31 July 2015 (both as stated in the 2015/16 accounts in Table A) shows a £263 million (2.7%) increase in total creditors (amounts falling due within one year) while total creditors (amounts due after more than one year) have increased by £1.5 billion (12.4%).
The value of intangible assets has increased by £94 million (14.3%), current asset investments increased by £710 million (16.5%) and pension provisions have increased by £2.7 billion.
Income and expenditure
Table B provides a summary of income and expenditure for the last two academic years. Total income was £34.7 billion during the financial year to 31 July 2016. The surplus of income over expenditure was £2.3 billion in 2015/16, or 6.8% of total income.
The number of HE providers reporting a surplus was 142 out of 163 in 2015/16 (sourced from Table 1). Deficits in the financial year 2015/16 were reported by 20 HE providers.
Table C aggregates income and expenditure figures for HE providers funded by each of the four UK countries’ funding councils. All four countries reported a surplus for the year 2015/16. Chart 1 below illustrates change in surplus as a percentage of total income over the last two years (sourced from Table C).
Charts 2 and 3 below summarise HE providers' sources of income contributed by each source and the growth or otherwise over time (sourced from Table D).
Funding body grants represent 14.9% of total income. Tuition fees and education contracts represent 48.4% of total income. Total income increased by 3.6% from 2014/15 to 2015/16, but funding body grants decreased by 3.3%. Research grants and contracts income decreased by 1.4%, largely due to the £0.5 billion of exceptional income reported in 2014/15 in respect of the Research and Development Expenditure Credit (RDEC) scheme. All other sources increased with the largest increase observed in investment income (13.6%).
Chart 3 shows income by source from 2014/15 to 2015/16.
Funding body grants
Funding body grants reporting has changed for 2015/16. HE provider funds for academic and other purposes are allocated primarily by the Higher Education Funding Council for England (HEFCE), the Higher Education Funding Council for Wales (HEFCW), the Scottish Funding Council (SFC) and by the Department for the Economy Northern Ireland (DfE(NI)) acting as a funding agency for the four Northern Ireland HE providers. Some funds are also provided in England by the Skills Funding Agency (SFA) and the National College for Teaching and Leadership (NCTL). Table E provides the new breakdown of funding body grants by country of provider.
Tuition fees and education contracts
Table F provides a breakdown of income from tuition fees and education contracts by location of HE provider. The total income for tuition fees and education contracts increased by 8.2% (sourced from Table D) this year to £16.8 billion from £15.5 billion in 2014/15. This continues to be effected by the change to the funding regime. Income from full-time Home and EU domiciled undergraduate students provided 57.6% of the income in this category, and that from all non-EU domicile students provided 26.5%. The total income from HE course fees varied by location as shown in Table F, as did the proportions by the type of fees as indicated in Chart 4 (sourced from Table F).
Research grants and contracts
Research grants and contracts decreased by 1.4% (sourced from Table D) in 2015/16. The Research Councils continue to be the largest providers, representing 33.3% of total research grants and contracts income.Table G provides a breakdown of income from research grants and contracts.
Other income, investment income and donations and endowments income
Other income increased by 2.4% (sourced from Table D) this year to £6.0 billion from £5.9 billion in 2014/15. Over one third (34.5%) of other income came from residence and catering operations (including conferences). Investment income has increased by 13.6% and donations and endowments by 7.4% in 2015/16. Table H provides a breakdown of all other income, invesment and donations and endowments.
Academic departments accounted for 37.3% of total expenditure. Table J and Chart 6 displays the distribution of expenditure across activity groups.
The total expenditure in academic departments in 2015/16 was £12.3 billion with academic staff costs accounting for £7.5 billion. Table K shows expenditure by academic department group. Total expenditure of medicine, dentistry and health cost centres constituted 23.1% and biological, mathematical and physical sciences 15.0%. In all 10 departments the largest expense was academic staff costs, illustrated in Chart 7 below (sourced from Table K).
© Higher Education Statistics Agency Limited 2017