Government spending on British universities rose by only 6 per cent in ten years, the second lowest in a ranking of 29 developed countries published today.

Private spending soared by 85 per cent during the same period, 1995 to 2004.

A report by the Organisation for Economic Cooperation and Development said that Britain was losing out to other countries in its attempt to produce more graduates. Its figures show that Britain slipped from having the third highest proportion of graduates per age group in 2000 to tenth in 2005.

The report also found that in other countries more teenagers enrolled at universities: 51 per cent of British school-leavers signed up for a degree course compared with an average of 54 per cent. The proportion was higher than 60 per cent in nine countries.

The authors said: “Rates of current participation suggest that more countries are likely to surpass UK graduation rates.” The public-private funding trend was also reflected in schools, the report found, adding: “At all levels of education, private spending in the UK rose faster than public spending, with an increase of the private share from 11.5 per cent to 13.4 per cent at the primary and secondary levels of education.”

Public funding of primary and secondary schools fell to 86.6 per cent in 2004, from 88.5 per cent in 1995. The report added: “In both years this was one of the lowest public funding proportions among the OECD members reporting data for both years.”

It said that spending per university student had fallen by 7 per cent over the same period in real terms but the average for OECD countries was a 9 per cent rise. This was because the overall increase in spending in the UK, 22 per cent, did not match the rise in student enrolment, which was 30 per cent. The report added: “The share of capital spending at tertiary level is, at 5 per cent, considerably below the OECD average of 10.7 per cent.”

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