The country can’t afford to underfund universities

The government’s long-awaited response to the Augar review of post-18 education funding has finally landed, and it’s crunch time for universities.

Universities will be engaging fully with the consultations published because we know exactly what is at stake if the wrong policy decisions are made; decisions which pose real risks to student choice, to employers who need highly skilled grads to help their businesses thrive, and to the stability of our economy.

Frozen in place

One of the most challenging parts of the government’s announcement isn’t actually up for consultation. Since 2018, our universities have been doing more with less, so the news that tuition fees will be frozen again for another three years – we won’t get a penny more until 2025 at the earliest – is particularly trying.

As well as making up the shortfall on the cost of teaching and support, universities have had to increase their spending to provide Covid-19 safety measures and enhanced digital learning and digital support and equipment. Universities have also needed to invest significantly in support for mental health and wellbeing and they have seen increases in requests to access hardship funds , which are bound to increase due to inflationary pressures impacting students.

Let’s not mistake some university surpluses for “spare cash”, especially in this inflationary economic environment. Universities need surpluses to borrow and invest in campuses that deliver on the high quality research and teaching that the government wants from us. With growing inflation pressures, it’s not an exaggeration to say that some universities may simply not be able to afford to continue providing the breadth of high-quality courses that UK universities are internationally renowned for.

Frozen out

At Universities UK, our view has always been that anyone with the potential to succeed at university must have the opportunity to do so, and in this respect, some of the government’s announcements are not without promise.

New scholarships will help support disadvantaged students while they are studying, and we are also pleased to see the reduced interest rate on student loans, which will help new graduates with the cost of living as they begin their careers. The Lifelong Loan Entitlement which the government is exploring also has the potential to be completely transformational, enabling mature learners, those in work, and those looking to learn new skills with the funding they need to study flexibly.

The government consultations do however still pose huge questions which could limit the ambitions of prospective university students. Should there be a limit on how many people go to university? And what grades must they have? A cap on the number of students going to university would undeniably turn back the clock on social mobility. More disadvantaged students than ever before now go on to attend university, changing their lives and aspirations, and we cannot afford to see this progress undone.

If government moves forward with a cap on student numbers, it is disadvantaged students who will be most likely to miss out on university places. All those unable to attend university will be more likely to miss out on the graduate premium, which stands at around £10,000 per year. Instead, they are more likely to be unemployed.

Fired up

It is also difficult to see how a cap on student numbers and strict minimum entry requirements would fit with the government’s own levelling up agenda. All the evidence we have on the UK’s major skills shortages shows us that we need more graduates and more opportunities to learn. We need graduates to be at the forefront of post-Covid economic recovery, supporting the NHS and creating good jobs in local communities.

A recent report by the National Centre for Entrepreneurship in Education has predicted that over the next five years, UK universities will provide £11.6 billion worth of support and services to small enterprises, businesses, and not-for-profits, and 21,700 new companies and charities will be started because of universities. We need a stable funding environment to see this success realised in every corner of the UK.

Despite all the challenges we have faced over the past few years, our world-leading universities have been front and centre in the fight against coronavirus, and we have more to offer. We want to continue to work with government, communities, and business to build a stronger and more inclusive future as we recover from the impact of the pandemic.

With the right support, universities can change lives, drive the recovery of communities across the UK, and support the government’s levelling up agenda. We have an opportunity to collectively build a better future; let’s not mess it up.