Universities urged to save more

Student growth projections may fail to materialise.

A growing gap in university finances is emerging that is unlikely to be filled by projections of growth in international student recruitment, according to the Higher Education Funding Council for England.

Its annual report on the financial health English universities, published on 10 November, warns of an increase in variability across institutions. Overall universities are currently in a financially sound position, forecasts to 2018-19 indicate surpluses that are likely to be “inadequate”, declining cash levels and an increase in borrowing that will be unsustainable in the longer term, it says. The report highlights “over-confident” projections in the levels of growth in the numbers of home, EU and international students as being “of particular concern”, given that the uncertainty over EU withdrawal, an increasingly strict visa regime and declining numbers of 18-year-olds in the UK. In particular, the report warns that institutions are “increasingly reliant” on international fee income, which may be threatened by fiercer competition in the global higher education market, particularly since recent figures suggest international acceptances are down 1.1 per cent on last year.