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Boost in private giving to elite universities will widen HE wealth gap, Moody's warns

Philanthropic support for universities has grown faster in the UK than in the United States for the past five years, reaching £774 million last year, analysis by  the ratings agency Moody's has shown.

But a report on the findings says that most of the growth in private giving in the UK is concentrated among elite universities, with donations to Oxford and Cambridge universities accounting for half of the income.

It warns that if the trend continues "an increasing disparity of wealth will occur in the sector as donations are concentrated among the elite universities, as is the case in the United States". Universities with less private support and smaller endowments "will be challenged to keep pace with their wealthier counterparts", it adds.

Moody's says that UK universities have been capitalising on relatively recent investments in developing their fundraising capacity and organised campaigns, as well as government initiatives including a Matched Funding Scheme and favourable tax structures for private giving.

The agency says its outlook for philanthropy in UK higher education "is positive considering that UK universities successfully grew donar support during the period of slow economic recovery from the global financial crisis and the ongoing Euro zone crisis".

Increased university investment in fundraising resources and efforts "will continue to pay dividends", it predicts. However, growth is expected to slow over the next few years due to the ending of the government's Matched Funding Scheme which contributed £200 million in financial support and the conclusion of Cambridge University's £1 billion fundraising campaign.