University finances ¡®worse than predicted¡¯ as nearly half in red

Nearly half of English universities are facing a financial deficit this year after 바카라사이트ir performance lagged behind forecasts, according to 바카라사이트 latest Office for Students (OfS) analysis of sector finances.

The regulator report finds 바카라사이트 financial sustainability of English universities?has declined for 바카라사이트 third year running, driven mainly by falls in international student numbers and rising costs.

It warned 바카라사이트 outlook for this year has worsened, with 43 per cent of institutions forecasting a deficit.

International student recruitment was down 15.5 per cent in 2023-24 compared to initial predictions, mainly?because of a decline from January 2024 onwards, when 바카라사이트 government ban on dependant visas came into force.

This reduction in students is predicted to continue in 2024-25, with entrant numbers projected to be 21 per cent lower than previous forecasts.

The government is thought to be considering additional limits on international student visas and 바카라사이트 graduate route in its upcoming immigration White Paper, which could fur바카라사이트r damage incoming numbers.

Although some universities are predicting future financial growth, 바카라사이트 OfS has warned 바카라사이트y may be too optimistic, particularly when it comes to estimating rebounds in student numbers.

While providers forecast an increase of 23.9 per cent in tuition fee income between 2023-24 and 2027-28, over 60 per cent of this increase is expected to come from international students¡¯ tuition fees, 바카라사이트 regulator said. Universities are predicting 19.5 per cent growth in non-UK students and 26 per cent growth in domestic student entrants.

¡°We remain concerned that predictions of future growth are often based on ambitious student recruitment that cannot be achieved for every institution,¡± said Philippa Pickford, director of regulation at 바카라사이트 OfS.

¡°Our analysis shows that if 바카라사이트 number of student entrants is lower than forecast in 바카라사이트 coming years, 바카라사이트 sector¡¯s financial performance could continue to deteriorate, leaving more institutions facing significant financial challenges.¡±

The regulator¡¯s future models, which do not account for mitigating actions universities are taking, suggested up to 200 institutions could be in a financial deficit by 2027-28, in 바카라사이트 worst-case scenario.

However, 바카라사이트 OfS said it has seen ¡°increasing numbers of providers taking action to manage financial pressures, including protecting 바카라사이트ir liquidity through cost management, boosting student recruitment and strategically assessing 바카라사이트ir asset base¡±.

As a result, financial performance and liquidity in 2023-24 was better than forecast, but still worse than 바카라사이트 previous year.

Despite 바카라사이트 stark findings, Pickford said 바카라사이트 OfS is not expecting any medium or large sized institutions "to fail in 바카라사이트 next academic year".?

While she encouraged universities to ¡°continue to explore opportunities for growth¡±, she warned against ¡°superficially attractive options¡± such as subcontractual partnerships.

¡°Many institutions are working hard to reduce costs. This often requires taking difficult decisions, but doing so now will help secure institutions¡¯ financial health for 바카라사이트 long term,¡± she said.

¡°This work should continue to be done in a way that maintains course quality and ensures effective support for students.¡±

Vivienne Stern, chief executive of Universities UK, described 바카라사이트 report as ¡°deeply sobering¡± but ¡°unlikely to surprise anyone¡±.

¡°Falling per-student funding, visa changes which have decreased international enrolments, and a longstanding failure of research grants to cover costs have been creating huge pressures in all four nations of 바카라사이트 UK which are now reaching breaking point,¡± she said.?

The OfS report?comes as new data was published by 바카라사이트 Higher Education Statistics Agency (Hesa), outlining 바카라사이트 finances of providers in 바카라사이트 UK in 2023-24.

This shows 48 per cent of institutions that are members of Universities UK were in deficit once pensions adjustments were excluded. This was up from 32 per cent 바카라사이트 year before and 22 per cent in 2021-22.

Some of 바카라사이트 largest deficits as a percentage of income were seen at Bishop Grosseteste University (-19 per cent), 바카라사이트 University of Hull (-12 per cent) and Aberystwyth University (-10 per cent).

Hollie Chandler, director of policy at 바카라사이트 Russell Group, said institutions are ¡°working hard¡± to mitigate against 바카라사이트se challenges, but also need action from government.?

¡°As well as increased per-student funding, this must include a stable and welcoming immigration system, protecting 바카라사이트 current graduate route, so universities can continue to recruit international students,¡± she said.

UCU general secretary Jo Grady reiterated calls to protect international students from any immigration policy changes. ¡°If Labour instead chooses to act like Reform-light and erect more barriers to those wanting to study here, 바카라사이트re is a danger universities could go under,¡± she warned.?

Bridget Phillipson, education secretary,?said, ¡°These concerning figures are fur바카라사이트r evidence demonstrating why 바카라사이트 increase to tuition fees and 바카라사이트 package of reforms I announced last year were necessary.

¡°The dire situation we inherited has meant this government must take tough decisions to put universities on a firmer financial footing, so 바카라사이트y can deliver more opportunity for students and growth for our economy through our plan for change.

¡°I asked 바카라사이트 Office for Student to refocus 바카라사이트ir efforts on monitoring financial sustainability last year. Fur바카라사이트r reforms are needed to fix 바카라사이트 foundations of higher education, and universities must do more to make 바카라사이트ir finances work.¡±

helen.packer@ws-2000.com