Wikipedia says that:

The UGC was wound up on 1 April 1989, with its powers transferred to a new body, the Universities Funding Council, which was directly responsible to Parliament.

But it's not really clear was was going on.

  • Was the UGC faulted for specific failings?
  • Who came up with the initiative to abolish the UGC?
  • Was there significant opposition to the move?
  • If this is something to do with student grants, they were abolished around this time and replaced with loans
    – Ne Mo
    Mar 23 '16 at 12:07
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    The Student Loans Company wasn't created until 1990, and the majority of students were still mostly funded by grants (with small supplemental loans) in the early '90s. In my experience students switched from being mostly grant funded to being mostly loan funded around 1993-94.
    – PhillS
    Mar 23 '16 at 12:47

I can't give you a definitive answer here, but I think the explanation is that the government of the day was swiftly moving away from emphasising government grants as being the sole method of providing funding to students and researchers, and towards a mix of methods of funding, and clearly had an interest in enabling the introduction of student loans.

The wording of the original act (http://www.legislation.gov.uk/ukpga/1988/40/part/II/chapter/II/crossheading/new-arrangements-for-funding-higher-education/enacted) is very clear in avoiding overuse of the word 'grant' and suggesting a mix of funding methods, and also emphasising that the staff of the new council are "to have experience of, and to have shown capacity in, industrial, commercial or financial matters or the practice of any profession".

Furthermore I would suspect that the new body was designed to improve the degree to which government power over higher education was not mitigated by an intermediary body. That's a suspicion based on the generally centralising role of the Thatcher governments towards any entities that wielded a degree of independent power. That said, the UGC had acted as a tool for the first round of cuts to higher education, so that point should not be overemphasised.

There's a good article here with a view of UGC from a university perspective in 1984: http://link.springer.com/article/10.1007%2FBF00128560#page-1

My recollection as someone who went to university in 1988 is that the writing seemed to be on the wall for student grants. And certainly by late 1989 there were major protests against the intention to introduce loans (http://www.onemanandhisblog.com/archives/2010/11/student_protests_1989_style.html). There seems good reason to believe that the abolition of the UGC was intended as a precursor to the introduction of student loans. Therefore the fact that the Student Loans Company would not be established until two years later in 1990 does not contradict the fact that this change was largely about the abolition of grants.

Edit to the above - as noted in the comments. The UGC 'grants' were block grants provided by government to universities, and not to be confused (as I did above) with student grants, which were paid by LEAs. Therefore the statement above that "that the abolition of the UGC was intended as a precursor to the introduction of student loans" is not correct.

I do suspect that the reforms were part of the doctrinaire increase of government power over a semi-autonomous body, and the move away from viewing the government as the sole-source provider of financing to universities via the block grants towards a view of universities seeking funding from public and private sources. However a fuller answer depends on somebody with more specialist knowledge than I have.

  • 1
    As I understand it, the UGC filled the role HEFCE does now - a body for giving block grants to universities for teaching/research funding - and wasn't involved with student maintenance grants. These came from Local Education Authorities. I'm thus not sure its closure was linked to student loans as such, though these were certainly part of the same packet of reforms.
    – Andrew
    Mar 23 '16 at 18:00
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    As I know to my cost, at least some funding was split between various bodies - the UGC for Humanities, the various research bodies for Science/Social Science - certainly at post-graduate level. It was an admittedly confused/confusing system.
    – TheHonRose
    Mar 24 '16 at 2:16

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