Tuition fee rise: opportunities ahead for universities

Thriving universities are essential to a thriving United Kingdom. 

From getting our economy motoring again, to narrowing the gaps in opportunity and boosting the UK’s global standing, whatever challenges we face as a country, universities are part of the solution. 

Universities ensure that the workforce, regardless of people’s background, has the skills necessary for the jobs of tomorrow. Their discoveries drive the cutting-edge industries of the future. They promote British values abroad and attract global talent. 

Universities of all types, rooted in their communities, contribute to these goals regardless of their perceived prestige. Some have a profoundly local mission, educating the public sector workforce for the city they are in, others are global magnets for investment. They all play a part, in every corner of the UK.

That is why it is essential that our universities are properly funded. For over a decade, universities have faced insufficient investment, despite the recognition of our world-leading higher education and research system.

In the last year, those chickens have been coming home to roost, following a period of high inflation and falling international student numbers. As a result, many universities have had to make difficult decisions, including budget cuts, job losses, course closures, and other cost-saving measures.

The government’s announcement on 4 November 2024 of an inflationary increase to tuition fees in England would not have been easy but it was necessary. Since the introduction of £9,000 fees in 2012, tuition fees have risen only once, by £250. Inflation has cut their value to just £5,924 in 2012-13 prices. 

A survey of institutions earlier this year found almost 40% have seen voluntary redundancies, almost 30% have reduced module choices for students, and almost a quarter have closed courses — a picture likely to have worsened significantly in recent months as international student numbers declined after a tightening of visa rules. 

An inflationary rise in fees is important because it prevents further erosion of university funding for teaching undergraduates, but it does not reverse the real-term decline in fee value. In short, the government’s decision steadies the ship, but if we want the wind in the sails of our universities, we need a concerted and strategic effort by both universities and government over the long term.

That’s why, in Universities UK’s recently published blueprint for higher education, the sector’s leaders focused on what needs to change to meet the challenges the country faces. We have an outstanding university system, but how can we make a bigger contribution to narrowing opportunity gaps, boosting local growth, and contributing to flourishing towns and cities? And what more can the sector do to be as sleek and efficient as possible?

Our blueprint for higher education is committed to establishing a cross-sector Transformation and Efficiency Taskforce to seek savings through greater collaboration. This taskforce will be established by the end of 2024 and will report in Summer 2025.

Like our financial services, life sciences and creative industries, higher education is a global British success story. Indeed, it powers those other sectors too through the skilled workforce and innovations it produces. 

After this important first step, it’s time for the sector and government to work together to nurture our universities back to full health so that they can, in turn, support the nation’s renewal.