Higher education

Vice-chancellors fear for financial outlook of UK higher education

Cuts in tuition fees could push some institutions towards insolvency, survey finds

Richard Adams and

Rachel Hall

Wed 31 Jan 2018 19.21 GMT

Last modified on Wed 31 Jan 2018 20.22 GMT

Share on Facebook

Share on Twitter

Share via Email

View more sharing options

Share on LinkedIn

Share on Pinterest

Share on Google+

Share on WhatsApp

Share on Messenger

Close

Vice-chancellors are increasingly fearful about the financial outlook for UK higher education, after a survey of university leaders found many worried that 「febrile」 cuts in tuition fees could push some institutions towards insolvency.

While a majority of universities said they were financially stable, many of the leaders surveyed said even relatively small cuts in fees would cause severe problems for several institutions.

The confidential survey comes as the government has confirmed its desire for a major review of higher education funding in England, following a cabinet reshuffle that saw Justine Greening deposed as education secretary because of her opposition to a review.

University students failed by rip-off fees, says watchdog

Read more

Theresa May is said to favour allowing universities to charge variable fees – above or below the current £9,250 per year – based on graduates』 income, but opinion inside the government remains split over how to impose the policy.

Four out of five people surveyed disagreed with variable fees based on graduate earnings, while two out of three said they opposed making some universities charge less than others.

「We have already modelled it in various scenarios, and so if it was reduced by even £1,000 with no infill from the [government], then you would see universities really struggling almost immediately,」 one vice-chancellor told the researchers.

「Cashflow and liquidity would really be tricky. You could still get by but you would be limping – some universities it might even push to insolvency.」

Another warned that students midway through their courses could be put at risk by college closures: 「How do you protect students who are on courses at these universities and where does it leave them?」

Nearly two-thirds of the institutions surveyed from both the public and private sector said they had become less optimistic over the last 12 months. The survey, commissioned by HSBC, interviewed 59 university and college heads or deputies, with the majority naming student recruitment as their single biggest area of concern.

Nick Petford, vice-chancellor of the University of Northampton, said that falls in income from students would be 「catastrophic」 for some institutions, and blamed the removal of the government’s cap on undergraduate numbers for making matters worse.

Universities – take back control of your vice-chancellors' spiralling salaries | Mike Ratcliffe

Read more

「It is the removal of the student number cap that’s having the biggest differential impact on income. There is a domino effect, with medium to lower tariff institutions, many of them widening participation institutions, on the receiving end,」 Petford said.

「Ironic then that a move aimed at giving students more choice is now penalising financially those most closely engaged with social mobility.」

Several leaders said the sector had become very competitive as universities fought to attract a shrinking pool of school-leavers. They reported that entry tariffs were being lowered and unconditional offers were becoming more common, even among Russell Group universities.

The survey revealed that many university heads feel that bad publicity over the past year has 「bruised」 the sector and lost them public support.

Topics

Higher education

Tuition fees

Students

Education policy

news

Share on Facebook

Share on Twitter

Share via Email

Share on LinkedIn

Share on Pinterest

Share on Google+

Share on WhatsApp

Share on Messenger

Reuse this content

本文來源：https://www.theguardian.com/education/2018/jan/31/vice-chancellors-fearful-about-financial-outlook-for-uk-higher-education