English universities’ income falls for third consecutive year

Universities successful England person experienced a autumn successful income for the 3rd twelvemonth successful a row, according to the higher acquisition regulator, arsenic it warned that declining planetary pupil numbers would construe into much cuts connected campuses.

The Office for Students’ (OfS) annual fiscal wellness check recovered that galore universities were trying to repair fund deficits by slashing gathering and attraction spending arsenic good arsenic cutting courses and staff, with the assemblage expected to merchantability disconnected much than £400m worthy of onshore and spot this year.

“The presumption is mostly driven by a nonaccomplishment to enlistee the anticipated levels of non-UK students … recruitment levels for these students for 2024-25 are present projected to beryllium astir 21% little than projected past year,” said Philippa Pickford, the OfS’s manager of regulation.

“What that means is the fiscal challenges successful the assemblage stay stark. We’re seeing declines successful the level of surpluses and liquidity, with astir fractional of institutions forecast to beryllium successful shortage adjacent year.”

Universities person relied connected planetary students paying lucrative fees to marque up for deficits from teaching UK students, whose tuition fees person been eroded by inflation. But caller migration and visa changes person provoked a crisp autumn successful planetary recruitment since 2023, with the authorities expected to tighten restrictions further.

Jo Grady, the wide caput of the University and College Union, said the study confirmed that universities remained nether terrible fiscal stress, with 10,000 jobs disappearing from the sector.

A caller canvass for University College London recovered a bulk of British voters enactment planetary students staying successful the UK to enactment aft studying. Photograph: Loop Images/Universal Images Group/Getty Images

“The Home Office indispensable present deliberation again and propulsion immoderate further attacks connected planetary students from its migration achromatic paper. If Labour alternatively chooses to enactment similar Reform-lite and erect much barriers to those wanting to survey here, determination is simply a information universities could spell under,” Grady said.

A caller canvass by More successful Common for University College London recovered that 51% of British voters deliberation planetary students staying to enactment aft studying is simply a bully happening for the UK, including 33% of those who voted for Reform successful 2024.

The OfS’s regulators “don’t expect to spot aggregate assemblage closures successful the short-term”, but Pickford warned that universities “will request to spell further” successful making changes to amended their semipermanent position.

Pickford suggested that prospective students could look astatine universities’ published fiscal accounts to usher their decisions if they were concerned.

“The bulk of assemblage students would ne'er person to interest astir this and to day nary pupil has been importantly impacted by a assemblage failure. The risks of this happening are inactive debased – this is truly astir sending messages to universities to instrumentality the enactment they request to instrumentality present to debar getting into that presumption successful the future,” Pickford said.

However, the OfS said it was moving intimately with a tiny fig of institutions wherever they are “concerned astir their fiscal viability”, and talking to the authorities astir protecting students successful the lawsuit of closures.

Under 1 scenario, the OfS forecasts that “market competition” could pb to two-thirds of universities being successful shortage by 2027-28, arsenic much prestigious institutions regenerate shrinking numbers of planetary students by expanding their recruitment of home students.

Bridget Phillipson, the acquisition secretary, said the figures supported the government’s determination to rise home tuition fees, with further moves coming successful a achromatic insubstantial retired aboriginal this summer.

“I asked the OfS to refocus their efforts connected monitoring fiscal sustainability past year. Further reforms are needed to hole the foundations of higher education, and universities indispensable bash much to marque their finances work,” Phillipson said.