Sir Alan Langlands, chief executive of the Higher Education Funding Council for England, offered an analysis of policy developments in a lecture at the Institute of Education, University of London, on 3 April.
The former chief executive of the NHS in England said the sector was in a “much more stable position than I imagined we could be” ahead of the transition to the new tuition fees and funding regime in 2012-13.
But he added: “The real challenge for financial sustainability…is threefold.
“One, we need to ensure the delicate balance between Hefce funding and [the] funding that, in future, will be channelled through the Student Loans Company. We can’t allow that to get out of kilter.
“Secondly, that student numbers and the availability of student support funding are perfectly balanced.
“Thirdly, that the government has got its calculations right on the repayment profile for the student loan book. These have got to turn out to be robust to make this whole thing work into the longer term.
“These are the three things that if I were in the Treasury, I’d be worried about.”
Sir Alan called for the sector to present a unified front in the defence of its funding ahead of the government’s next spending review – which “is not going to be a picnic”, he said.
With government support remaining in place in areas such as widening participation and high-cost subjects, the sector should “make a continuing case about the public value of higher education…in a way that makes sense to the government and the wider public”, Sir Alan continued.
In 2010, as the government prepared to raise tuition fees and slash funding, splits emerged between Russell Group and other universities that welcomed a rise in fees and newer institutions that opposed the moves.
Sir Alan said: “Giving the government the option of a divide-and-rule approach is not a clever thing to do. People will have to stand together over the next year or two.”