Abstract
This paper arises from a research project funded by the Department of Education and Science (DES). It relates an analysis of the events leading to the announcement of significant recurrent grant reductions by the University Grants Committee (UGC) on 1st July 1981 to the responses of nine universities to these events. It draws policy implications for the DES and the UGC, or the proposed Universities Funding Council (UFC), and an important managerial lesson for university managements, i.e. the need to respond positively to warnings of reductions in grants.
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