We’re only a fortnight away from Andy Burnham, Ursula von der Leyen, and António Costa getting together to sign a new deal with the EU.
According to the version seen by Rapporteur, the draft sets a target of sorting the fees EU students will pay within six months.
The EU and UK will work towards a supplementing agreement to the Trade and Cooperation Agreement providing for equal treatment with nationals as regards tuition fees for EU students in the UK and for UK students in the EU.
The Guardian is reporting that ministers are willing to spend up to £450m a year if Brussels lets the UK into its Made in Europe industrial programme, and at least six member states want a firm commitment by the summit rather than the six-month deferral the Commission has proposed.
Cheaper fees for EU students look like a question of when rather than whether.
Almost all of the coverage calls this a “discount”. That raises an obvious problem. Universities set their own international fees. So how, exactly, does a government make them charge less?
The instinctive answer is the fee limit. In England, the fee limit condition regulations cap what fee cap providers can charge “qualifying persons” on undergraduate courses – £9,790 in 2026–27. Add EU nationals back into the qualifying category and their undergraduate fees are capped.
But the cap only applies to undergraduate provision at providers that have opted into it. It does nothing for postgraduate taught fees, which aren’t capped for anyone, and nothing at providers outside the fee cap regime. If the deal genuinely means “equal treatment with nationals”, the cap can only ever be half of the answer.
Charging someone more because of where they come from would ordinarily fall foul of discrimination law. What makes the international fee lawful is section 1 of the Education (Fees and Awards) Act 1983, which lets ministers make regulations “requiring or authorising the charging of fees which are higher” for students “not having such connection with the United Kingdom” as the regulations specify.
Those regulations are the Education (Fees and Awards) (England) Regulations 2007, and until 2021 EU nationals counted as having the necessary connection. That’s why EU students paid home fees on postgraduate courses too – no cap required, just a rule that you couldn’t charge them more than everyone else.
When the government ended home fee status for EU students starting courses from August 2021, it pulled three levers in one instrument. Part 3 of the 2021 regulations amended the Fees and Awards rules, Part 7 amended the fee cap, and other parts amended eligibility for student support. The explanatory note describes Part 3 as permitting “the charging of fees which are higher in the case of students not having a specified connection with the United Kingdom.”
Reversing that is the obvious way to deliver what the draft declaration says. Universities would still set their own fees – they just couldn’t charge an eligible EU student more than a home student, at any level of study.
The problem is that that works like a switch rather than a dial. A student either has the specified connection or they don’t, and the machinery isn’t obviously built to say “you can charge this group more than home students, but not that much more.”
That matters because a genuine halfway house was on the table. In October the Telegraph reported that the EU side had floated a rate of around £13,000 – roughly the average cost of delivering a degree, based on KPMG’s £12,317 figure. Delivering that through regulation would mean inventing a new, higher fee limit for a new category of student – which, again, would only reach undergraduates at fee cap providers. In England.
The alternative is money rather than law. The government could pay providers a chunk of each eligible EU student’s fee and leave universities to price as they like – but without tight conditions of grant, there’s nothing to stop the headline international fee drifting up to absorb it.
Read the leaked text alongside the Guardian’s costings and it looks like the switch plus the money. “Equal treatment with nationals” is Fees and Awards language, and the £450m is compensation for lost income. The Treasury’s top scenario reportedly assumes domestic fee levels and very high demand, and one official called it “speculative”. Whatever the coverage calls it, the “discount” is just the gap between the international and home rates.
Pre-Brexit, the test wasn’t just nationality – it was nationality plus three years’ ordinary residence in the EEA or Switzerland. The Council’s negotiating mandate pins fee equal treatment to the youth experience scheme, but the draft declaration talks more broadly about “EU students in the UK”. Whether eligibility attaches to the visa route, the passport, or residence decides how many people the £450m is meant to cover.
The EU mandate says equal treatment “should not extend to study and maintenance grants or loans”, so the student support regulations could be left alone. That would be new – before 2021, EU students got the tuition fee loan as well as the home rate. Home fees paid upfront in cash will produce a much smaller demand response, particularly from the central and eastern European countries whose numbers fell furthest and whose governments are now pushing hardest.
It also exposes something odd about “equal treatment with nationals”. Home students in England don’t actually pay £9,790. They borrow it, on income-contingent terms, and the bit the government expects never to get back is a subsidy baked into the loan book. The headline fee is the price on the label rather than what anyone pays at the till.
An EU student paying the home rate upfront, with no loan, would therefore pay more than the nationals they’re supposedly being treated equally with – the full sticker price, with none of the write-off.
The EU has signed up to that by excluding loans, but it means the discount is smaller in practice than the gap between two headline fees suggests.
Then there’s Scotland. Under the Education (Fees) (Scotland) Regulations 2011, Scottish students pay nothing – so EU students would pay nothing too, while students from the rest of the UK pay £9,790. That’s a funded-places problem for Holyrood, and nobody in the summit coverage seems to have asked who would pay for it.
The Russell Group’s briefing puts the cost of home fee status at around £570m and wants it kept out of any deal. Universities UK’s Vivienne Stern told peers in July that one vice-chancellor would cut domestic places in response.
But a static estimate of lost fee income mostly measures where EU students currently are and what they currently pay – London and research-intensives charging £30,000 or more. The government’s own London Economics modelling of the 2021 change found Oxford and Cambridge would gain from charging EU students international fees, while every other cluster, from the rest of the Russell Group to post-92s, would lose. Run that in reverse and the pain is anything but even.
For a mid-tariff university charging £15,000 or so, the drop to the home rate is small, it has few existing EU students to lose money on, and it would gain applicants with low visa refusal rates just as the Home Office tightens its basic compliance assessment. Add compensation and some providers come out well ahead.
None of this is hard to do. The 2021 instrument shows the government knows exactly which regulations to amend, and amending them back is a statutory instrument rather than primary legislation. The hard parts are who qualifies, whether a halfway rate is wanted badly enough to build new machinery for it, how compensation is allocated, and what happens in Scotland.
Presumably that’s what the six-month window is for. Whether the answers on compensation reflect where the money is actually lost – rather than where the loudest briefing is written – is the bit universities ought to be watching.