Britain’s newest Chancellor delivered his first Budget today, and across a 7,000-word statement John Healey had one line to offer on universities.
We have top-ranking universities, vibrant start-ups and deep capital markets.
Add £18 million for advanced chip design led by Edinburgh and that was it for higher education. It would be easy to blame a new Chancellor with a war-driven energy crisis to deal with, but the silence goes back a decade.
The other day I pulled the as-delivered Hansard text of every major fiscal statement since Gordon Brown’s first Budget in July 1997 – 74 in all, from Budgets and Pre-Budget Reports to Autumn and Spring Statements, Spending Reviews, and the emergency packages of 2020, 2022 and 2026.
I then looked for mentions of students, universities, graduates, fees, loans, science, research or apprenticeships.
The result? Chancellors talk about higher education in proportion to the levers they hold over it – and over three decades those levers have been taken away, given away, or turned from things to hand out into things to hold down.
Under New Labour sentences about HE teaching, student finance and access run at around 1.7 per 10,000 words of the Chancellor’s speech. Under the coalition and George Osborne, up to the 2015 Spending Review, that rises to 4.0. Since then it has fallen to 0.3 – five sentences across 28 statements in ten years.
Public science and research is the only area that grows steadily, from 2.6 to 3.5 to 3.7 per 10,000 words. Universities still appear in the speeches, but almost only as places that do research.
For Brown, expansion was something to announce because it was something he paid for. While HEFCE grant funded teaching, every extra student was extra public spending, so participation could be presented as a gift from the Treasury. In the first Comprehensive Spending Review in 1998 he told MPs exactly that.
The next spring’s Budget promised to “help 700,000 more young people to go on to further and higher education”. By the 2000 Spending Review it had become a national goal.
By 2010, we want the majority of young people to be going on to higher education.
The same statement is where access first shows up as a Treasury concern. Brown pointed out that state pupils got “two thirds of the top A-level qualifications, but only half the places in some of our leading universities”, and put money behind HEFCE to reward providers that widened participation.
The 2004 Budget, delivered while top-up fees were being fought through Parliament, tied the reforms to “rising real-terms funding, to progress towards the 50 per cent. target for students in higher education”. Brown’s last Budget in 2007 promised to “increase higher education student numbers to 1.2 million”, alongside doubling apprenticeships and one-to-one tuition for 600,000 children.
Alistair Darling’s pre-election Budget in March 2010 was the last of its kind.
Almost 400,000 more of our talented young people now go on to university than in 1997.
He also found £270 million to “help universities to create 20,000 more university places, largely in key subjects such as science, technology, engineering and maths”. But the tone was already changing, with universities told they “must make efficiency savings while focusing their funds rigorously on quality teaching and research”.
Once £9,000 fees had replaced most teaching grant, an extra student cost the Treasury little on the deficit, and that changed what a Chancellor could say. In the 2010 Spending Review Osborne called universities “the jewels in our economic crown” while explaining why their funding had to change. Three years later he found the lever that gave him his biggest HE moment.
The 2013 Autumn Statement marked 50 years since the Robbins report, “which challenged the nonsense that university was suitable only for a small few”. Osborne quoted its principle that “courses of higher education should be available for all those who are qualified by ability and attainment to pursue them and who wish to do so”, said it should remain true today, and then made the announcement.
The money came from the loan book again – the new loans would be “financed by selling the old student loan book”.
Osborne wanted the credit, and a year later he was back at the despatch box to make sure he had it.
A year ago, I abolished the arbitrary cap on the total number of undergraduates at our universities.
That statement also brought in postgraduate masters loans of up to £10,000 “for the first time ever”. In the Summer Budget of 2015 he announced cap removal all over again, so that “we do not have to turn away from our universities people who want to go and who have the right grades”.
Brown made one first-person HE announcement in 13 years. Osborne made nine in five, and they cluster around the cap. The last big act of Treasury credit-taking on higher education was the abolition of the Treasury’s own control over it.
The architects of abolishing student number controls liked to say they had freed universities and students from the clutches of the Treasury. On the evidence of every fiscal statement since, what they mostly freed them from was being funded by it.
Between 2013 and 2015, most statements that mention student numbers are defending the 2012 reforms against the charge that they would put poorer students off, rather than claiming growth. The 2013 Spending Round recalled “the scaremongering about fees, and the claims that they would destroy social mobility and put off students from poorer communities applying”, and answered with a statistic.
By the 2015 Summer Budget Osborne was attacking “those who so opportunistically opposed us”. Brown had treated access as a problem for the state to fix, while Osborne used it as a number to win an argument.
The same Summer Budget is where student support changes direction. Having lifted the cap, Osborne said the government couldn’t afford it without tackling maintenance grants.
So “from the 2016-17 academic year we will replace maintenance grants with loans for new students”. By November’s Spending Review he was calling them “unaffordable student maintenance grants”.
The coalition years are the only period where support moves both ways at once. I count eight extensions, including masters loans, part-time loans and bigger maintenance loans, against six restrictions – from keeping grants “but not increasing them” in 2013 through to scrapping them.
The last volume claim in nearly 30 years of fiscal statements applies the same trick to the last capped group. In the 2015 Spending Review Osborne said that over half of applicants to nursing were being turned away, so the government would “replace direct funding with loans for new students, so that we can abolish this self-defeating cap and create up to 10,000 new training places in this Parliament”.
Switch grant to loan, lift the cap, take the credit – and after that there was nothing left to switch.
Since that Spending Review, the HE content of 28 fiscal statements fits in one para. Philip Hammond’s 2016 Autumn Statement listed “the highest ever number of young people going on to study full time at university” as the last item in a run of achievements on crime, schools, doctors and pensioner poverty. His 2017 Spring Budget brought in “maintenance loans to part-time undergraduates and doctoral loans in all subjects for the first time”.
Jeremy Hunt found £40 million for further and higher education participation in Northern Ireland in 2023. And last year Rachel Reeves made the only HE announcement a Chancellor has made in person since 2015.
I will also keep the plan 2 student loan repayments threshold at its 2026-27 level for three years.
It’s a freeze, and the timing fits what happened to the accounting. In December 2018 the ONS changed how student loans are treated in the public finances, so the expected write-off now counts against the deficit when loans are issued.
Expansion that had been almost free on the headline measures became visible spending, and HE moved from something a Chancellor can be generous with to something a Chancellor has to contain.
Since 2016, universities turn up as research engines, hosts for compute, anchors for investment zones, or names in a patriotic roll-call. Hammond’s 2019 Spring Statement said that “our universities are global powerhouses of discovery and invention”. Rishi Sunak sent new research money outside the south-east “to our brilliant universities around the country” in 2020, and in 2021 reminded MPs that the UK has “four of the world’s top 20 universities”.
Hunt’s first Autumn Statement called Britain “the land of Newton, Darwin, Fleming, Faraday, Franklin, Gilbert and Berners-Lee, the home of three of the world’s top 10 universities”, then said investment zones would be “centred on universities in left-behind areas”. A year later he credited “the best universities, the cleverest scientists and the smartest entrepreneurs” with Europe’s most innovative economy.
Reeves’ 2025 Spending Review produced the purest version of the genre.
Our universities are world-leading, and we are proud of them.
The statement said nothing about what anyone studying in them might need.
Brown had treated universities as economic partners, from the 1998 “university challenge fund” to the 2002 promise of “a third role for universities beyond teaching and research – the commercialisation of new discoveries”. That strand almost disappears after him, falling from 1.2 sentences per 10,000 words to virtually none under Osborne.
After 2015, apprenticeships gave the Treasury a skills volume story for a while. Osborne’s Summer Budget said “we have already doubled the number of apprenticeships to 2 million” and committed to “3 million more”. Hammond repeated the 3 million in 2017, 2018 and the 2019 Spring Statement, crediting “our apprenticeship levy”.
Then that stops too. Since 2019 there are only passing mentions – Hunt wanting more apprentices, Reeves noting that Sizewell C supports 1,500 of them – with no targets and no claims. The levy made apprenticeship numbers something employers decide, and the Treasury lost interest just as it had with degrees.
Taken together, the speeches tell a story in three acts.
Labour bought places and set participation targets, so Chancellors talked about HE as a gift. The coalition removed the control, so Osborne talked about HE as a liberation he’d delivered himself. Since then, with growth demand-led and loans counting against the deficit, HE has become something that happens to the Treasury rather than something it gives.
That matters. A Budget used to be a place where good news on student support might turn up, because a Chancellor wanted the credit for expansion and would pay for it. Now the only HE lever a Chancellor reaches for at the despatch box makes graduates pay more.
Nobody in the Treasury owns HE growth any more – and when nobody owns growth, nobody has much reason to fund it.
Healey’s first Budget ended by promising “breathing space now, fresh hope for the future”. On the evidence of 30 years of these speeches, neither universities nor students should expect either to come from the Treasury.