Higher Education: Finance

Department for Education written question – answered at on 19 February 2024.

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Photo of Paul Blomfield Paul Blomfield Labour, Sheffield Central

To ask the Secretary of State for Education, whether she has made an assessment of the potential implications for her policies of the report entitled Financial Sustainability of the UK Higher Education sector, published in January 2024.

Photo of Robert Halfon Robert Halfon Minister of State (Education)

This response assumes that the report referenced is PwC’s UK Higher Education (HE) Financial Sustainability Report, which was commissioned by Universities UK. Departmental officials have met with Universities UK to discuss the findings of this report.

The PwC report cites similar risks to those identified by the Office for Students (OfS), which is the independent regulator of HE in England responsible for monitoring the financial sustainability of registered HE providers. The latest report by the OfS on the financial health of the sector, which was published in May 2023, can be accessed at: https://www.officeforstudents.org.uk/media/0b7d9daa-d6c7-477e-a0b2-b90985d0f935/financial-sustainability-report-2023-updated-june-2023.pdf

The department continues to work closely with the OfS, HE representative bodies and other government departments, as appropriate, to understand the financial sustainability of the sector.

In the aforementioned OfS report on the financial health of the HE sector, the OfS stated that the overall aggregate financial position of the sector is sound. However, there continues to be significant variation between individual providers, both across the sector and within peer groups.

The department consistently assesses the potential implications for any policies that could impact the HE sector, including financially, and particularly with respect to the interests of students.

It is important to note that HE providers are autonomous and, as such, it is for them to decide effective business models in order to adapt to financial risks. All HE providers should be stress testing their financial plans to ensure they are fit for purpose and that they do not rely on optimism around student recruitment.

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