Concern has been raised by universities across England following the government’s announcement regarding significant cuts in funding for higher education.

The Higher Education Funding Council, Hefce, has revealed that, due to continued pressure on public sector finances, the total fund for universities for 2010-11 will be £7.3 billion, £573 million less than last year. Although this is a 0.9% increase in cash terms, it will actually equate to a 1.1% cut in real terms when inflation is considered.

Consequently, while Hefce has held its nominal recurrent funding figure for the University of Cambridge at 0.1%, this represents a cut of 1.9% in reality. However, in an attempt to promote teaching and research, Hefce has offered the top five research institutions, of which Cambridge is one, 33% of the funding allocated for research.

Nevertheless, Andrew Reid, Director of Finance for the University of Cambridge, told Varsity that, “The University has been planning for this small real reduction and will be reporting its Budget in May”.

“The University's medium-term plans are being prepared on the basis of material real cuts in government funding. The plans involve cost-savings and efficiency gains across the University where possible and, where necessary, keeping posts vacant so long as teaching quality and research excellence is not compromised.”

Hefce has predicted that, despite a year-on-year increase of 23% in the number of applicants to higher education, such cuts will result in approximately 6,000 fewer university places this September. This is particularly troubling for the University of Cambridge, who saw a 6.5 % increase in the number of people vying for places this year.

Sally Hunt, general secretary of the University and College Union, said, "After years of rightly encouraging people to go to university, the government is abandoning a generation who, instead of benefiting from education, will find themselves on the dole alongside sacked teaching staff".

Students from the University of Cambridge have expressed concern. One student maintained that, “While such cuts are understandable during a financial crisis, it is concerning that so many university places will be lost”.

However David Lammy, Universities’ Minister, has played down talk of a crisis. “Like everyone in the current financial climate, institutions have to do their fair share of belt tightening but these figures do not show a university system in crisis”, he said.