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We have asked six ÖйúAƬ institutions for recovery plans because of the scale of holdback and consequent moderation funding that applies to them for the 2001-02 funding round. It would be wrong to describe this as a "crisis".

The point is to secure action in good time before it becomes a crisis. All of the institutions concerned were aware of the need for action and are responding vigorously. This is a routine part of our standard monitoring, working with institutions to identify potential problems and support robust action before they turn into major difficulties.

Holdback of grant following under-recruitment is a well-established part of our funding mechanism. We do it to avoid overpaying institutions for students they do not have. This year was exceptional because universities were filling places vacated by the bulge year of recruitment in 1997, so some institutions had to work hard to try to meet their student number targets.

Brian Fender, Chief executive, Hefce