The fee rise that did not fix universities
Tuition fees went up to 9,535 pounds, but nearly half of England's universities still face deficits. The funding model is the problem.
Almost half of England's universities are on course to report a financial deficit this academic year, despite the rise in tuition fees to 9,535 pounds. The Office for Students says 124 institutions, 45 per cent of those it analysed, face a deficit in 2025-26, up from the 34 per cent that expected one in May.
The regulator's modelling suggests only a moderate improvement ahead, with 41 per cent still expected in deficit in 2026-27. One in six institutions has fewer than 30 days' liquidity. The OfS says providers have been persistently over-optimistic about student recruitment, particularly international students.
The sector's 2024-25 outturns were better than feared, a 0.9 billion pound surplus on 48.1 billion of income. But the structural pressures remain: the real-terms value of the fee has fallen, costs have risen, and international recruitment has softened after years of tightening visa policy.
Some specialist arts provision was no longer financially sustainable.Christopher Malish, Bradford College
The sharpest pain is falling on colleges. The OfS's 2026-27 allocations cut further education colleges' recurrent funding by 2.72 million pounds, 9.3 per cent, more than twice as fast as the sector average. Bradford College lost 64.9 per cent of its allocation, 223,600 pounds.
The Government has required the OfS to stop general high-cost subject funding for computing, nursing, geographical systems, archaeology and creative and performing arts. A 32.1 million pound supplement for nursing, midwifery and allied health courses remains. Bradford's deputy chief executive Christopher Malish said some specialist arts provision was no longer financially sustainable and would have to be reviewed and in some cases closed.
The fee rise bought time, not a settlement. With the Treasury facing its own constraints ahead of the Budget, further help from the public purse looks unlikely.
The result is a slow-motion restructuring of English higher education: mergers talked about in corridors, courses closed quietly, and students paying more for institutions with less to spend. The question is no longer whether the model changes, but how, and who decides.
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