The Higher Education Funding Council for England (HEFCE) has today announced that it will distribute £5,076 million to 131 higher education institutions and 196 further education colleges offering higher education courses in England in 2002-03.

This will support teaching, research, and business and the community activities.

Forum Response: Universities UK

Diana Warwick, chief executive of Universities UK, also told ePolitix.com: "Universities delivered an outstanding result for the recent Research Assessment Exercise, and the £140 million shortfall in funding its outcome is enormously damaging across the whole sector.

"The hard decisions that will need to be taken by individual institutions following today's recurrent funding announcement will severely damage morale within a sector which has delivered exceptional results. We are deeply concerned over what this settlement will mean for future selectivity and further concentration of research funding.

"The longer term developments referred to by Hefce will be endangered if the research capability of many of our universities is cut, as high quality teaching must be underpinned by active research and scholarship."

"The £10 million increase in funds for widening participation is welcome but we note that this increased funding is for one year only. That must be sustained for longer and at a higher level as the real costs of widening participation are significant and long term. "

Forum Response: Natfhe

Paul Mackney, general secretary of Natfhe told ePolitix.com: "Modern universities and their staff were hoping that their heroic efforts to develop research profiles against the odds would be rewarded. Instead large numbers of them have received a kick in the teeth.

"Most new universities will have to make cuts and that means redundancies for our members. The government has a last chance to turn the tide for higher education funding in the next spending review. If it doesn't come up with a substantial cash commitment to higher education, it can kiss goodbye the target of 50 per cent of 18 to 30 year olds in HE."

Forum Response: Association of University Teachers

Sally Hunt, assistant general secretary, told ePolitix.com: "While it is welcome news that for the second year running there will be a real terms increase in funding per student, this is the clearest statement yet that we are heading for a two-tier university system.

"Despite the overall investment in teaching and widening access there are real threats to jobs and research. This year's settlement will not be able to fund the pay of staff in Universities.

"The axe will cut deep across the university sector unless the government takes immediate action to fully fund the latest results of the Research Assessment Exercise.

"Nearly half of all HEFCE institutions face real-terms cuts in research funding which will lead to further redundancies and demoralisation amongst academic staff."