Talk to a university lecturer for a few minutes, and their fears quickly become evident. Jon (not his real name), who took redundancy from a university in the south of England last year, doesn’t want his “remaining colleagues to suffer from the idea that the university is doomed”—though he clearly thinks it is. “We’re becoming something far closer to an FE college than a uni,” says a lecturer at Coventry University. A dozen other staff I spoke to were too afraid of damaging the reputation of their institutions to talk on the record about the extent of the crisis.
No British university has yet gone bust. The omertà on identifying places at particular risk is faithfully observed, because no student will apply to an institution they suspect is on the point of bankruptcy. But it feels like only a matter of time.
Jon’s humanities department used to attract a mix of students from the county and the rest of the UK. By the time he left, it had shrunk. Student numbers had plummeted and courses had been axed. He fears the department will “hit a death spiral”, as the remaining faculty are forced to reduce the choice of modules and even fewer students apply.
Five thousand higher education (HE) jobs have already gone this academic year, while the same number are at risk, according to the University and College Union—and not just in institutions like Jon’s, which became a university in 1992. Prestigious Russell Group universities such as York (at least 300 jobs to go), Cardiff (400), Newcastle (300) and Queen’s University Belfast (270) are all urgently seeking redundancies. Edinburgh wants to save £140m and says that “nothing is off the table”. Arts and humanities courses have often been the first to go as students choose subjects that will qualify them for better-paid jobs.
The University College Union’s rolling list of closures, job losses and restructurings makes for grim reading. Whole departments are disappearing: a handful of remaining staff will “teach out” courses so that students can finish their degrees. Kingston’s renowned philosophy department is no longer accepting any applications. You can no longer study English at Bournemouth. Cardiff wants to close its nursing school altogether. At other places, the remaining staff are being transferred into cheaper pension schemes and worse terms and conditions. The government barely seems to acknowledge the scale of the cutbacks, or what will happen as subjects disappear from universities—nor the effect of encouraging some of the most talented scholars of a generation to quit academia.
“I don’t think we’re at the lowest point,” says Josh Freeman, policy manager at the Higher Education Policy Institute (HEPI), a thinktank. “Things are going to get worse before they stabilise. People who’ve spent a lot of time in academia feel that this is the worst it’s been.”
No single decision is to blame. Talk to academics and, as you would expect from some of the cleverest people in the country, you will hear a variety of well-argued explanations for the crisis facing British universities. But many trace it back to a decision made by chancellor George Osborne in December 2013.
Osborne announced that the government would no longer cap the number of students that a university in England or Wales could admit. There were some grumblings about how this would be funded and whether the quality of courses would go down. But on the face of it, the decision offered them big opportunities for expansion. It helped that only a year earlier, the government had tripled the tuition fees they could charge to £9,000 each year. This decision was hugely unpopular, and contributed to a decade-long collapse in popularity for the Lib Dems, who had campaigned against fee increases before entering a coalition government with the Conservatives.
Nick Hillman has been the director of HEPI since 2014. He left his previous job as special adviser to universities minister David Willetts just as the cap was lifted in 2013. In a 2014 HEPI report he called it a “vote of confidence in the potential of higher education to transform lives, improve social mobility and raise economic performance” and noted that 97 per cent of “millennium mothers”—women who gave birth between 2000 and 2002—wanted their kids to go to university. He also warned that little thought had been given to the question of funding, and predicted that resources for every student would become more stretched.
A lot of those millennium mothers will have been disappointed. The number of people accepted to university did continue to rise, though not quite as rapidly as in the 1990s and 2000s. By 2017, Jon’s institution was already feeling the effects of the new policy. A nearby Russell Group university—the group which represents 24 of the most sought-after institutions—had roughly doubled the size of one of its humanities departments in five years. Local students turned away from Jon’s department and enrolled there instead.
Theresa May’s government did realise that universities would have to find more income from somewhere
Universities can hardly be blamed for wanting to expand: the government had encouraged it, after all. “Where Russell Group universities are increasing undergraduate intake on certain courses, they are doing so in a responsible way while maintaining quality,” says Joanna Burton, the head of policy at the Russell Group. Understandably, that is not how Jon sees it. “[That university] got greedy because they were allowed to,” he says.
Meanwhile, tuition fees had been nudged up slightly to £9,250 in 2017 before being frozen. The Conservative government had no desire to stir up more anger among students and their parents, and were happy for tuition fees to remain forever associated with Nick Clegg and the Lib Dem-Tory coalition.
Theresa May’s government did realise that universities would have to find more income from somewhere. After Brexit, EU students would become liable to pay the full international fee rate, which was expected to deter many of them, and did. In 2019, the Department for Education warned the education sector it was “below its potential” and urged it to recruit from the rest of the world, setting a target of 600,000 foreign students studying in the UK by 2030.
Universities obliged. Despite the Covid pandemic, they began to recruit hundreds of thousands more students from Asia and Africa, most of them postgraduates on one-year taught courses. Boris Johnson made that even easier by introducing the Graduate Visa, which gives international students coming to the end of their course the right to apply to work in the UK for two years afterwards. It was an attractive proposition for foreign postgrads, and it worked. More than half the students who first arrived in 2020 still had leave to remain in the UK three years later. British universities were quicker to open up after the pandemic than rivals in the US and Australia, making them an even more appealing proposition.
Meanwhile, inflation steadily ate away at the value of domestic tuition fees. Research funding shrank, partly due to years of uncertainty about whether the UK would be able to access Horizon Europe funding after Brexit. Then Russia invaded Ukraine, and the cost of energy soared.
So did the fees for these short postgrad courses, which are a lucrative source of income. University College London, for example, charges £33,000 for an MSc in computational finance. Fees for masters in business administration can be much higher: the cost of an MBA at Judge Business School at Cambridge is £74,000, and living expenses—a lot of which will go to the university, if it owns the accommodation a student stays in—add up to around £20,000 on top of that. Post-1992 institutions charge a lot less, but a fee of £18,800 still helps prop up budgets at institutions such as the University of Hertfordshire.
By the 2022-2023 academic year, two-thirds of the fulltime postgrads studying in the UK were from outside the UK or the EU. Most came from India, China and Nigeria. Forty-one per cent of all fee income comes from international students. It has become indispensable to the survival of universities and their ability to teach home undergraduates. Overseas students now effectively subsidise the cost of teaching each UK undergraduate by an average of £2,500 each.
In cities such as Edinburgh, with large numbers of overseas students, this had troubling knock-on effects: accommodation became increasingly expensive and hard to find. Universities crammed more students into their buildings, still unable to afford to expand after the pandemic had hit their finances. Some are still locked into repaying expensive private finance deals that were negotiated during the 2010s. “Most of us feel we have more students than we can teach,” an academic at Edinburgh tells me. “My subject area has been trying to reduce students. We don’t have lecture theatres that can fit them in.”
They counted on being able to recruit yet more foreign students: the University of Nottingham’s plan, which was typical, was to keep overall numbers steady but recruit even more students from abroad. But this was a strategy that depended entirely on the government’s willingness to tolerate high levels of immigration. In 2024, that came to an abrupt end.
James Cleverly, the home secretary at the time, was alarmed by rising net migration figures and noticed that foreign students had brought almost 150,000 family members with them in 2022. Universities were “selling immigration not education,” fumed the Home Office. It banned most students from bringing relatives and commissioned a review into whether people were “abusing” the Graduate Visa, with a view to abolishing it.
Would-be students got the message. Applications from abroad dropped. Preliminary figures suggest that the number of student visas granted last year fell back to 2021 levels. Managers scrambled to close courses and open voluntary redundancy schemes. Now it was not just the newer universities that were suffering, but the Russell Group too.
The problem is especially acute in Scotland. Scottish undergraduates do not pay tuition fees and to make this affordable for Holyrood, their numbers are capped. Institutions get only £1,820 a year for every student, plus an extra grant depending on the cost of teaching the course. It is nowhere near enough.
Edinburgh asked for voluntary redundancies but “it was a very poor offer, and no one seems to be taking it up,” an academic there told me. Now it intends to make cuts of £140m, with compulsory redundancies likely. “They’ve really lost a lot of trust,” the academic says. “All this messaging, which has really been very threatening and over the top, is going to weaken our ability to attract students.”
There is an answer to this mess but it’s not one that the government or public want to hear
Many of the academics I spoke to are angry with their managers. The enormous salaries and bonuses that vice-chancellors often receive are a particular source of fury. The vice-chancellor of Leeds left in 2024 with a pay and severance package worth £430,000. The leaders of Oxford, Cambridge, University College London and the LSE all earned in the region of half a million pounds. “Most vice-chancellors haven’t been public about these issues,” says the academic at Edinburgh. “They’ve not been willing to engage politically.” Researchers argue that managers over-expanded recklessly, often based on projections that failed to anticipate the immigration crackdown and assumed tuition fees would go up with inflation.
“But it’s not just that,” says Dyfrig Jones, a senior lecturer at Bangor. “They come in and can advise you, but there is a herd mentality within university management in the UK. Everyone buys into the same datasets, makes the same decisions. What that leads to is bland uniformity across the sector, particularly outside the Russell Group.”
Yet much of the bad advice came from the government itself. Universities, faced with declining real-terms income, did exactly what the government asked of them: first accepting more home students, then recruiting abroad to make up the fees shortfall and boost the sector. When that turned out, entirely predictably, to have increased net migration, they took fright.
There is an answer to this mess, which is to raise tuition fees again. It’s not one that the government or the public want to hear. Tuition fees are finally going up this year, but by just £285, a rise that will barely cover the cost of the extra National Insurance contributions for staff announced in the government’s autumn budget. Universities hope fees will at least go up with inflation each year, which would mean they will soon breach the symbolic £10,000 barrier.
“Views fall broadly into two categories,” says Andrew McRae, a professor of English at Exeter. “Those who say that things could be fixed by simply increasing fees to a realistic level, and indexing to inflation, and those who argue that everything is fundamentally broken. The latter arguments are kind of seductive, but in my view never quite acknowledge the fact that, for a decade or so, UK higher education was, broadly speaking, in fantastic shape. That wasn’t long ago, but is starting to feel like it.
“The government could and should manage this by scaling back the Tories’ regressive changes to the repayment [student loans] regime.” In 2023, it cut the minimum salary at which students had to start paying back their loan and extended the maximum repayment period from 30 to 40 years. “Those have soured the whole environment, in ways that aren’t often enough acknowledged.”
Another solution would be to relax the ban on international students bringing dependants. (It led to a 16 per cent drop in study visa applications in July to September 2024, compared to the previous year.) That is out of the question. Had it not been warned that axing the Graduate Visa would probably bankrupt some universities, the Sunak government would almost certainly have ended that scheme too. Ever resourceful, universities are trying to get around the problem by opening campuses abroad: Cardiff in Kazakhstan, Queen’s University Belfast in India. This infuriates the University College Union, since few staff are in a position to relocate, or even want to. Others based in less immediately attractive parts of the UK are opening campuses in London in the hope of recruiting more students. “Welcome to your place of possibility,” says University of Staffordshire London, which has recreated its Olympic Park campus in Fortnite for the benefit of would-be undergraduates in computer games design.
Jon is still in academia—just. He now works at another post-1992 university in the Midlands, which has survived by lowering its admission standards, recruiting more local students and hiring people like him to help them tackle university-level work. He describes it as “quasi-academic”. Jon is on a short-term contract, but all members of staff there have been invited to take severance.
The story of the UK’s university crisis is ultimately simple. More students wanted to go to university. The government was happy to encourage them, but unwilling to pay universities for their places. Now the game is up. “It’s unethical to expect that international students will subsidise home students,” says McRae. “As a nation, we should be capable of maintaining an excellent HE system for our own students.” Yes, we should. But there will always be another course to cut, another department to close and another country with a dubious human rights record willing to host an outpost. You can draw a lot of blood from a university before it collapses. We are watching the patient weakening in real time.
