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Fee freeze among factors creating “significant fiscal deficit” for some English institutions, warns David Behan
Universities should consider mergers or partnerships with other struggling institutions to survive in the face of bankruptcy, while tuition fee rises should also be on the table, according to the new chair of the English higher education regulator.
Office for Students (OfS) interim chair David Behan also suggested tuition fees should be increased and visa restrictions on international students lifted to help the sector stay afloat.
Speaking to the Sunday Times, he said: “I think the resilience of the sector overall has been tested by a number of different forces… the global pandemic, the impact of leaving the European Union.
“We’ve had industrial action, the cost-of-living crisis, the increasing cost of pensions and decreasing number of international students, and then, finally, domestic undergraduate fees remaining frozen since 2012… and what it’s meant is that the fiscal deficit for some organisations is significant.”
End of the golden age
In May the OfS predicted about 40 per cent of English universities would run budget deficits this year.
Behan, who became interim chair last month after the exit of Conservative peer James Wharton following Labour’s election win, suggested the “golden age” of English universities could be over and institutions should consider all means by which they could secure financial stability.
When asked about whether the government should raise tuition fees, he responded: “I think if we’re going to mitigate these risks to this sector, we need to look at all these possibilities.
“So all these things should be on the table.”
He did not believe there was “one single silver bullet that is going to sort this”. But he added: “By the same token, the sector needs to innovate and find new models, new business models for a way of delivering courses.”
Behan continued: “It’s not just what government can do, it’s how the sector can also begin to adjust and flex.”
He added: “It’s important that universities revise their medium-term financial strategies … They can’t just carry on.”