Briefing Document to Lobby Your MP:
A Failed Experiment becomes a Catastrophe
Newcastle University has announced the need for £35 million of cuts. It has frozen school budgets, recruitment, travel, replacement posts, and promotions, unless ‘business critical’. It has undertaken two rounds of voluntary redundancies, adding to the workloads of those who remain. Those on fixed term contracts or hourly paid work will lose their jobs. We fear compulsory redundancies will follow.
Newcastle University is not alone. Many other institutions are in vicious circles of job cuts and course closures limiting the opportunities for students and damaging universities.
Higher Education is in crisis. The high tuition fee model is a failed experiment in its last stages. It threatens to bring the collapse of higher education in this country.
- Nowhere else in the world has a successful university sector on this basis.
- There is a need to break with the failed experiment of the neoliberal high tuition fee model.
- Government needs to fund the pay rise and fund TPS to stabilise university finances.
- It needs to restore the block grant to fund the education of students.
- It needs to end the destabilising scramble for students that exacerbates the crisis for some institutions with status-bullying by ‘prestigious’ institutions with cuts resulting often in places that need their universities the most.
- It needs to stop the visa restrictions that damaged this year’s recruitment of international students.
- It needs to address the university funding model urgently or face the devastating consequences for local and regional economies dependent upon their universities.
- University leaderships, UUK, UCEA, etc. have no answer, have benefited enormously from, and are complicit in the failed experiment.
Here is an evidence-based resource on the scale of the crisis and the urgency of government action.
Queen Mary University London UCU branch has compiled a list of Higher Education Institutions facing redundancies totalling 79, namely over half of all universities in the UK. The numbers adding to this list are accelerating. UK HE shrinking
UUK Blueprint: Opportunity, Growth and Partnership indicates the conventional wisdom of those who run the universities in the UK. It is more of the same: growing commercialisation via international students, continued domestic tuition fees, competitive infrastructure spend and risk-laden tie-ups with private (even explicitly venture) capital. The authors include key architects of the current crisis David Willetts and Peter Mandelson, representing the neoliberal ‘solution’ to HE. On the positive side the document does outline the significance of HE to regional and local economies.
Opportunity, growth and partnership: a blueprint for change
The UUK commissioned the accountants PWC to report on Higher Education that was published in January 2024 outlined how employers viewed the situation of their finances and all acted upon this advice with disastrous consequences. It triggered a wave of course closures and redundancies. It concluded that finances of universities were ‘at amber’ and advocated cross-subsidisation from international students created a sector-wide rush in a declining market, for which staff and students are paying the price.
Financial Sustainability of the UK Higher Education sector, January 2024 – PwC UK
The Institute of Fiscal Studies produced a report on the impact of the spring 2022 reform of student loans. It outlined how the reforms that dramatically worsened loan repayments for those on lower incomes was a threat to access and to the sector: a leap in the dark.
Student loans reform is a leap into the unknown | Institute for Fiscal Studies
Higher Education Statistical Agency (HESA) Financial data
Contents of releases – HE Provider Data: Finance | HESA
In November 2024 the Office For Students (OFS) produced a report on the ‘financial sustainability’ of the sector, finding 40% of universities to be in financial deficit in 2023-24. By 2025-26, 72% will face an operating loss and 40% of institutions could face a severe liquidity crisis and possible failure. The report, as much as anything, indicates how the OFS is not fit for purpose, another feature of the failure of the neoliberal experiment in UK HE. Treating students as consumers, the university regulator understands its role to be to help students find an alternative university course if their university goes bankrupt or their course closes.
Navigating financial challenges in higher education – Office for Students
Financial sustainability of higher education providers in England: 2024 – Office for Students
Student indebtedness is a threat to growth and widens inequality. The scale of student debt is astronomical with 1.8 million people owing more than £50K and the highest debt standing at over £250K. Students face 40 years of debt. Total outstanding loans in March 2024 was £236bn. It has produced a generation who will have to rent rather than buy their own homes. It has resulted in a greater debt burden inhibiting economic growth.
Student loan statistics – House of Commons Library
Student loans: Almost 1.8 million owe more than £50,000 – BBC News
For international comparison the OECD has produced a report on tuition fees in 2022. A quarter of survey countries have no fees for domestic students. A further quarter have low fees under US $3000. The high fees category is $4000-8000 for others. England is an absolute outlier with $12000.
UCU seminar on university finances. The university staff union, UCU, has had to provide training for its reps to navigate universities as they are forced through financial crises that end the careers of highly-trained professionals in areas where the social need for their skills is clearly apparent. The possibilities of a wave of universities going illiquid first surfaced during the pandemic; it did not materialise but the current threat is exponentially greater.