Over the last five years student numbers and income have grown annually by 2 per cent and 6 per cent respectively. As the sector has begun the transition to a new system of funding in which Funding Council grants to institutions will be replaced by higher tuition fees the Higher Education Funding Council's role in the allocation of funds & influence will diminish. The Department for Education will need to provide new powers for the Funding Council to regulate these institutions and the Funding Council must monitor risks as they emerge and respond quickly. All the indications are that more institutions will charge significantly higher fees than was anticipated by the Department. The Office for Fair Access has yet to agree the measures universities will adopt to widen participation where the proposed fees are above the £6000 level. However it is likely that a significant funding gap of hundreds of millions of pounds for the taxpayer will occur. The Funding Council also has a responsibility for promoting value for money, although it does not assess the value for money of institutions. In future, prospective students will need better information to make an informed choice about where they will study, including comparable information on the financial health of, and value for money provided by, individual institutions. The Funding Council does not normally publish the names of institutions it judges to be at financial risk, so as to protect them while they are in recovery. Now that students are required to make a substantial financial investment in their degree, the Funding Council needs to strike a suitable balance between the interests of institutions and those of prospective students