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Fears some institutions may recruit mainly international students – whose fees are not capped

Universities across the UK could soon be forced to cut the number of UK students they take, increase class sizes and axe staff, vice-chancellors warn. They are calling on the government to intervene to stave off a crisis, as the real value of tuition fees plummets.

The prestigious Russell Group of universities says institutions are making a loss of £1,750 a year teaching each home student because tuition fees have remained almost static for 10 years and have not kept pace with inflation. On average, universities will be losing £4,000 a year on every UK undergraduate by 2024, the group says. Experts say some may end up pulling out of teaching UK students, focusing entirely on international students and postgraduates.

The government raised the cap on tuition fees to £9,000 a year in 2012 and it has been fixed at £9,250 since 2017. Ministers are widely assumed to be determined to avoid any discussion of this politically toxic issue in the run-up to the next general election, and have already confirmed that fees will remain frozen until at least the 2024-25 academic year. But university heads say the current funding system is “just not working”, and the government must think about how to support them adequately, either by offering additional funding for teaching or by overhauling how higher education is paid for.

Prof Steve West, the president of the vice-chancellors’ group Universities UK, says: “If nothing changes, universities will have to look at what they can scale back on. They may be forced to say: ‘We need bigger courses and fewer staff.’ That’s not a place anyone wants to go to, but there may be no choice.”

West, who is vice-chancellor of the University of the West of England in Bristol, adds: “Education is too important to be a political football. Clearly this isn’t the time to put fees up, but the government can’t just avoid talking about how to finance universities.”


Many universities, particularly at the most selective end of the sector, are already opting to increase their numbers of international and postgraduate students, whose fees are not capped by the government.

Prof Colin Riordan, the head of Cardiff University, a member of the Russell Group, says that if universities start accruing bigger losses on their teaching, “they will have to start reducing the number of home students they take”. They are likely to cut back on UK places on nationally important subjects like science, engineering and technology, because they cost the most to teach, he says.

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The University of Northampton says it prides itself on taking a large proportion of UK students from challenging backgrounds – but that teaching them is expensive. Photograph: John Robertson/The Guardian

“I think the government has a national duty to ensure that it is at least viable for us to teach students from this country.”

Riordan says he sees no sign that the government is acknowledging the unfolding “crisis”, and fears ministers will simply tell institutions to sort it out themselves. “The government must be held accountable for the funding framework they put in place, which just isn’t working,” he says.


Mark Corver, a co-founder of dataHE, a consultancy that advises universities on their admissions, says that “some universities may more or less pull out” of offering full-time undergraduate degrees to UK students.

He predicts UK school leavers will discover this summer that it is already harder to get into university. “We saw with the energy market that if you don’t let the price caps reflect the cost of providing the service, eventually suppliers just shut up shop,” he says.

“This year’s school leavers have got the strongest GCSEs of any cohort ever, so they are going to be expecting to go to the sort of university that those high grades would usually suggest,” he adds. “But it’s just not clear that the supply of places will be there.”

Corver says if the CPI rises by three points later this year, as the Bank of England has suggested, RPI is also likely to rise from 12% now to to around 15%, meaning that by September the current £9,250 tuition fee will be worth only around £6,350 in 2012 prices. That is a reduction of nearly a third compared to the £9,000 fee introduced by the government back then.


“We’ve probably got the best university sector in the world, which is publicly subsidised, but it is financially better for them to teach and upskill young people from competitor countries. It is a bizarre situation.”

Prof Nick Petford, the vice-chancellor of the University of Northampton, says: “This isn’t special pleading, it’s harsh economic reality and a real-terms cut. If it were happening in the NHS there would, quite rightly, be politicians all over it.”


Petford says his university prides itself on taking a large proportion of students from challenging backgrounds, many of whom have been on free school meals at school, but that supporting them so that they succeed is expensive.

“This is classic levelling up, and we have deliberately moved away from the blockbuster-style delivery with 300-seater lecture theatres and gone for smaller class sizes to support these students,” he says. “But high quality face-to-face teaching is costly.” He adds: “If the unit of resource keeps declining this will become unsustainable.”

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Nick Hillman, the director of the Higher Education Policy Institute thinktank, says the biggest risk with underfunding is not that many universities will go to the wall, but that institutions will not be able to give their students the experience they expect. “I went to university in 1990 after a dozen years of falling per-student funding and the result was an impersonal learning experience that many people simply wouldn’t accept today.”

He argues that staff will have to teach and support far more students, so will resort to setting less work to manage their marking, and avoid giving feedback because it takes too long. University buildings and facilities will deteriorate and “become grotty” without investment, he says.


Hillman says he visited one university earlier this month during an open day when parents were “checking out the facilities”. “That’s one reason why the government can’t allow things to go back to the old days,” he says. “Parents have high expectations too.”

A spokesperson for the Department for Education says: “The government is backing our world-beating universities with £750m extra funding over the next three years. We are boosting the grant rate for students in laboratory-based healthcare and Stem subjects in real terms and increasing the funding for universities to deliver high-cost subjects to £817m.


“The student finance system must be fair for students, universities, and the taxpayer, and it is right that we have frozen tuition fees to reduce the burden of debt on graduates. We expect every university to deliver good quality face-to-face teaching – which is what students want and deserve.”

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