Universities may face further cuts to capital spending on top of the reduction announced this week, it has emerged

The Higher Education Funding Council for England (HEFCE) has allocated £562m to universities for the academic year that runs from August 2010 to July 2011, a drop of 14.9% on the previous year.

The move follows the government’s decision to halve the money that it gives HEFCE, which was announced in a letter to the council from Lord Mandelson, the business secretary, in December.

However, the academic year is four months longer than the financial one, and HEFCA’s budget assumes that government funding will continue at the same rate after March 2011 In a letter sent to the heads of universities this week, Sir Alan Langlands, HEFCE’s chief executive, warned that he may have to “revisit the allocations covering these four months” if the government decided to further reduce its funding for HEFCA in the 2011/12 financial year.

Universities will find out the size of their budget cuts in March. Imperial College and Bristol university are among those who have already scaled back development programmes.

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