Less than half of tuition fees income spent on teaching students, report suggests

‘Students are sceptical of things that are important to institutions but are less beneficial to them’

Almost three-quarters of students want more information on how tuition income is spent (Getty)

Less than half of tuition fee income at universities is spent on teaching, a report suggests, and the majority of students want to know more about where their money ends up.

Few students want their fees spent on management staff, student recruitment, marketing, or community work, research from the Higher Education Policy Institute (HEPI) has found.

Almost three in four (74 per cent) of students would like more information on how their tuition fees – which are up to £9,250 a year – are spent, findings from the think tank show.

Among institutions that provide a breakdown, about 45 per cent of tuition fee income is spent on the direct costs of teaching, the analysis suggests.

Much of the rest of the income goes on other academic uses, such as maintaining teaching buildings, IT and library facilities. And fees are also spent on student welfare and widening participation.

However, about a fifth of the income is spent on things that students are less keen on, according to HEPI.

“[Students] have a strong preference for teaching-related spending and are sceptical of things that are important to institutions but which appear less directly beneficial to students, such as marketing and spending on community engagement,” the paper says.

The report shows that Nottingham Trent University spends a total of £740 of each student’s annual fees on finance, marketing, HR, policy and planning, alumni and the vice-chancellor’s salary.

However, the paper concludes: “It is clear there is some distance left to travel before all students have access to clear and comparable information.”

The report calls on the government, regulators and institutions to make changes to increase transparency on the use of students’ tuition fees – and it suggests renaming “tuition fees” as “student fees” to reflect better how the money is spent.

The analysis is published just weeks after reports have suggested that tuition fees in England’s universities could be cut to £6,500 a year as part of the government’s review of post-18 education.

Nick Hillman, the director of HEPI and a co-author of the report, said: “Tuition fees were introduced 20 years ago and they have been tripled twice.

“Ministers and regulators have repeatedly demanded information on where the fees go. Yet there is still little information available and three-quarters of students want to know more.”

He added: “The arguments for telling students what they want to know are overwhelming. Where this has already occurred, it has tended to show less than half of the fees go on the direct costs of teaching but most of the rest does go on student-facing activities.

“Any reduction in the headline fee cap is therefore likely to hit students hard – unless every penny were permanently replaced by other funding, which history suggests is exceedingly unlikely.”

Jim Dickinson, a co-author of the report, said: “Students and their unions have been clamouring for information about where their fees go for years – yet despite nudges from government and sector bodies, research suggests that little progress has been made.

“Fears that increased transparency will lead to dissatisfaction are unfounded – and regardless of the balance between the state and student in funding higher education, students want and deserve to know where the money goes.”

Shakira Martin, president of the National Union of Students, said: “When students are paying such a high price to access higher education, it’s no wonder that many are demanding a greater transparency to how money is spent.”

She added: “There clearly needs to be much more accountability built into the system – to that end, providers publishing a breakdown of where fees go would be a good place to start. There must also be a greater student involvement in the decision-making process where money is to be invested.”

Alistair Jarvis, chief executive of Universities UK, said: “While progress has been made by universities to better explain the costs of a university experience there remains a need for more accessible information to improve public understanding.

“Universities UK is currently working with universities to develop guidance and to promote good practice on explaining the value students get for their money, and how fee income is spent. We will be publishing this guidance in the near future."

Responding to the report, Universities minister Sam Gyimah said: “Students’ ability to make informed choices is at the heart of our recent reforms to higher education. This Government recognises the importance of this area and is increasing the information available to students to ensure they can make informed choices about what and where to study.

“We think universities should follow suit which is why in February 2018 we asked the OfS to work with the HE sector to improve transparency, so that students know what they should expect. The OfS will play a key role in ensuring students have more information and guidance to help them effectively challenge providers who do not deliver on their commitments.”