Government tightens immigration policy, international student numbers drop sharply, many universities at risk of financial deficit

According to Universities UK (UUK), many universities in the UK are at risk of large financial deficits due to a sharp decline in the number of international students after the government tightened immigration policies.

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UK: Government tightens immigration policy, number of international students drops sharply, many universities are at risk of financial deficit. (Source: visco.edu.vn)

Ms. Vivienne Stern, CEO of Universities UK, an organization representing more than 140 universities in the UK, said that the higher education sector is greatly affected by immigration policies that prevent international students from coming to study in the UK.

Stern’s comments come as a number of leading universities, including the University of York, have been forced to reduce their entry requirements to maintain their numbers of overseas students. With tuition fees of £9,250 ($11,790) for domestic students held steady for the past 10 years, British universities have become increasingly reliant on overseas students, who now account for nearly 20% of the sector’s income, to stay afloat.

Universities are warning of a sharp drop in international student enrolments by January 2024, with signs that enrolments could have fallen by more than a third in key countries such as Nigeria and India.

Data from Enroly, a university admissions management web platform used by a third of international students, shows that deposits to secure places at UK universities by international students are down 37% compared to last year.

Chancellor Sunak announced changes to government policy earlier this month to stop international postgraduate students bringing family members to the UK. Last December, the government also announced a review of the two-year post-study work visa scheme for international students, as well as a crackdown on “low-value courses”.

A recent analysis by PwC found that the combination of falling international and UK student numbers, flat tuition fees and rising staff wages pose a major challenge to the higher education sector, which contributes £71bn to the UK economy.

PwC analysis of the 2021-22 financial returns of 70 UUK members in England and Northern Ireland found that around 40% of institutions are expected to be in deficit in 2023-24, with this falling to 19% by 2025-26.

The analysis found that if international student growth stagnates in the 2024-25 academic year, the proportion of universities in deficit would increase from 19% to 27%. However, if international student growth declines from 13% to 18%, 80% of institutions would be in deficit.

According to this analysis, increased financial pressure could force universities to delay investment, affecting the quality of training. According to Ms. Stern, to maintain stability in the higher education sector, it is necessary to increase tuition fees in line with inflation, increase government teaching subsidies and stabilize the international market by maintaining the mechanism that allows graduates to stay in the UK for two years.

Higher education minister Robert Halfon said the government was focused on striking the right balance between taking decisive action to reduce the current high net migration rate and attracting the brightest students to study at UK universities.

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