How we spend tuition fees

How does my tuition fee contribute to University income?

The income from tuition fees is the largest source of income for the University but only makes up around half of the total income of the University. The rest of the income comes from grants from the Funding Council, research and other income which includes things like accommodation and catering income.   

Source of income
Income £m
Tuition fees £120m
Funding council grants £36m
Research £37m
Accommodation and hospitality £28m
Other income £22m

Does the University have a lot more income now that tuition fees have gone up?

No, the way Universities are funded has changed. Under the old system the University received much more of its money from the taxpayer via grants from the Funding Council (HEFCE). The University would receive grants for teaching and buildings. Prior to the introduction of the higher tuition fee this grant has been reduced each year so the University has swapped one source of income for another.

It seems that I pay a lot per teaching hour, what is all the income spent on?

The University uses the income to provide the best student experience that it can. Obviously this includes paying for the highest quality academic staff but also includes all the academic and student services that students use such as the library, IT facilities, student services, teaching support, sports and arts facilities, bursaries and placements as well as the buildings that all these services are housed in. The University does well in national league table rankings because it delivers these services very well. Calling it a ‘tuition fee’ is misleading as the fee pays for so much more than tuition.

Expenditure £m
What it is spent on
£86m Academic departments
£40m Academic and student services
£24m Research
£28m Premises
£28m Residences and catering
£15m  Central admin services
 £6m  Other

Research is at the heart of the University’s activity and directly impacts on the quality of teaching. Research income is spent on high quality, often world class, research which informs teaching and helps attract the best academics to the University. All this activity needs high quality facilities so some of the income is spent on maintaining, heating and cleaning the buildings to make sure that the Universities facilities are among the best in the sector. Central administration such as management, human resources, finance, communications and planning provides an efficient support service to the academic, research and other University activity. 

But the University makes a profit, why?

In 2014/15 the University made a surplus of £16m. It’s important to remember that the University is a charity; it has no shareholders or owners that it has to pay money to. All the surplus, or profit, is re-invested to further improve the University. The University needs to make a surplus so that it can pay for new buildings and for the refurbishment of the older buildings as well as to continue to invest in academic staff and facilities.

Financial statements 2014/2015
Income 243.4
Expenditure 227.2
Operating surplus 16.2

So am I paying for a building which will only be built after I’ve finished my studies?

No, in the last two years since the £9,000 fee was introduced the university has spent just under £140m on buildings and equipment which benefit everyone now. To do this the University has borrowed money and so some of the income pays for the interest on the loans and to repay the amount that has been borrowed.

So my fee pays for more than tuition but is it good value?

That’s a difficult question to answer; value can mean so many things. The University is ranked highly in all the major national University rankings and has been ranked 1st in the National Student Survey for 2013 and 2014 and 1st in the THE Student Experience Survey in 2015. It has also won the University of the Year award in 2012 and best campus University in 2013. In this context the University certainly is good value.

In purely financial terms a recent government study estimated that the current value of lifetime earnings comparing a graduate to a non-graduate is roughly £168k for men and £252k for women.¹ Of course this study makes lots of assumptions and no-one is the average graduate but the study did find that those graduates with higher degree classifications had higher earnings on average than those with lower qualifications. Because the University attracts the best students, gives a high quality education and student experience then Bath is amongst the best Universities in the country in terms of both degrees awarded and graduate employability.

Of course, important though they are, a University experience is about more than qualifications and employability. Many graduates will say that their experience at University played a big part in shaping who they are and that’s why providing the best student experience and facilities is so important. It also helps that we have a Students’ Union that is consistently ranked as among the best in the country offering plenty of opportunities for development and volunteering as well as over a hundred different societies to join.

More information on the University’s strategy and financial statements can be found at:

¹ BIS Research paper No 112. The impact of university degrees on the lifecycle of earnings: some further analysis.

University finance explained document