I’m not sure if people have spotted but higher education finances are not in a great shape.

It would be nice to be able to offer more detail than that, but our other problem is one of information – we’ve only just got information (of a sort) from the 2023-24 financial year (which, for most, ended on 31 August).

To that end, the Office for Students has issued a notice under condition of registration F3, setting out what constitutes only the second ever interim financial return – due for submission by 10 April 2025.

The invitation to submit isn’t universal – providers that have submitted their annual financial return in the last month, or are due to submit within the next two months, are exempt. Likewise if your principal regulator is ESFA you don’t have to bother, and if you are already in a state such that you are getting regular OfS engagement on finances you probably won’t need to either.

The new information updates the AFR relating to forecasts for the current financial year (the one ending in 2025). It’s super light touch (there’s no need to do the full verification/sign-off dance, just the approval of the accountable officer is enough). If forecasts are unchanged from the last set, it is permitted to make a nil return.

OfS will already have forecasts for 2024-25, in each of the last few annual financial returns, culminating in the “current year” (year 3) figures submitted (for larger providers) in early January. What OfS are looking for in this interim return are material movements in core finances – income, expenditure, cash, assets – plus the lowest projected cash balance, and updated information around borrowing (covering both new borrowing, and where covenants relating to existing borrowing may be breached).

The borrowing section is the innovation – additional questions requiring text rather than numeric responses. OfS already collects data on new financial commitments via table 13 of the main AFR, so this new information tops up what may well be a swiftly changing picture, particularly as regards the way that borrowing conditions may change with institutional performance.

It’s the first time, too, that OfS has collected information regarding the purpose of loans beyond a broad set of categories on the type of commitment (bond, sale and leaseback, revolving credit, and so on) and on non-compliance with covenants.

As Wonkhe readers will be aware, although OfS is supposed to have oversight of borrowing in practice the understanding of the true financial position of the sector has been weakened as providers are no longer required to notify the regulator as regards particular thresholds. There’s a welcome interest in borrowing to support operating cash flow – this (in contrast to borrowing for investment) is generally a great big flashing red light that a provider is experiencing existential problems. If the only way you can meet payroll is via an overdraft, OfS is going to want to get stuck in.

As always with regulatory data collection – we can only make a judgment as to the burden based on what is done as a result of this new knowledge to benefit the sector. It will be hard to tell, externally, as this is sensitive commercial information and is very unlikely to be published. Hopefully the (often unseen) work of the regulator to keep the sector stable will be enough.