Congrats to Cambridge – but fundraising is only part of the university funding story

by Stephen Tall on June 11, 2010

Here are some big figures to wrap your brains around.

The University of Cambridge has today announced its fundraising campaign, started in 2001, has just passed the £1 billion mark. That’s a phenomenal achievement: it is the first university outside of North America to raise such a sum.

Here at the University of Oxford, my employer, our Oxford Thinking campaign, started in 2004, has just reached the £875 million mark. The £1 billion beckons.

But then we look over the pond, to the US …

Harvard had what it labelled a “disappointing” fundraising year in 2009 – the University raised only US$602 million, an eight per cent fall on the year before. That’s over £400 million. And they’re not even in an active campaign!

Of course the US is different. Universities there have long been regarded as charitable institutions deserving of philanthropic support in a way UK universities are only slowly re-emerging after a twentieth-century sustained by state funding.

But the UK fundraising market is dominated by Oxbridge: more is raised by Oxford and Cambridge combined than by the rest of the UK universities combined. And yet even Oxbridge is still out-run by the US.

And of course the issue of financial prowess is cumulative: the more you have, the more you can afford to invest, the greater your return, the more you have, etc.

In the last two years, 2008 and 2009, Harvard’s endowment has returned over $3 billion of income to the University – that’s the equivalent of Oxford’s total endowment fund!

And all this in the context where most top research-intensive universities actually lose money on what many would regard as their core business: teaching undergraduate students. The cap on university tuition fees means that it’s cheaper to get a degree from Oxford or Cambridge than it is to send your toddler to most nurseries.

As someone who graduated from university with relatively modest debts of just over £1,000, I don’t underestimate the challenge for today’s students facing five-figure debts.

But there is a clear choice facing society and facing students: we can continue to starve universities in the UK of the cash they need to compete globally; or we can recognise the need for them to start charging a realistic fee in order to offer the best education they can.