Universities set to lose £2.5bn due to coronavirus

The economic impact of the COVID-19 pandemic has led to significant losses for businesses in many sectors, and universities are expected to be among the hardest hit. According to a new report by the University and College Union (UCU), UK universities may lose £2.5bn in tuition fees for the next academic year. A large part of this is a likely decline in overseas students due to the pandemic. Some universities are predicting that the number of international students could be more than 80% lower than most years.

Many universities rely on the higher tuition fees paid by international students, and while they may be able to fill some of these lost places with domestic students, that will inevitably leave less prestigious universities with the same financial difficulties. Director of the Higher Education Policy Institute (Hepi), Nick Hillman, said that universities might have to resort to cost-cutting measures.

He stated: “There are things they can do to mitigate the impact, such as doing all they can to ensure international students keep coming, pausing the development of their estates, doing less research, looking at their staffing and persuading home final-year students to stay on for postgraduate study. But some were in financial difficulties even before the current crisis.” 

The report also predicts that up to 30,000 jobs in higher education could be lost. This would, of course, severely impact both university staff and students’ education. There is, however, the potential for the government to cover some of these costs to prevent job losses and damage to research programs. Jo Grady, the UCU’s general secretary, said: “Our world-renowned universities are doing crucial work now as we hunt for a [Covid-19] vaccine and will be vital engines for our recovery both nationally and in towns and cities across the UK. It is vital that the government underwrites funding lost from the fall in student numbers. These are unprecedented times, and without urgent guarantees, our universities will be greatly damaged at just the time they are needed most.” This is also an option backed by shadow education secretary Rebecca Long-Bailey, who said: “UK universities must be valued as part of the frontline response to the coronavirus pandemic, supplying students to the NHS and conducting world-class research into the virus.” 

The government is yet to offer a statement on how it will respond to these potential losses within the UK higher education sector.

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Henry Webb

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January 2022
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