University finances could be hit by fall in applications

The Higher Education Funding Council for England (Hefce) has just published a report Financial health of the higher education sector 2011-12 to 2014-15 forecasts [1] outlining English universities’ finances.

In the report they highlight risk factors, which include:

  • fall in student recruitment and retention in an increasingly competitive market
  • failure to manage student number control
  •  further unanticipated public spending cuts
  • failure to achieve growth in overseas fee income
  • changes to visa regulations resulting in reduced overseas student demand
  • failure to comply with UKBA requirements resulting in removal of ability to sponsor non-EU students.


Income predictions


The outcome

Overall, the finances of English Universities are predicted to be generally sound, at least up to 2014-15. The report however highlights just how dependent the sector is on student numbers and student retention. And this is at a time of introducing higher fees, generally low levels of graduate employment and a financial crisis.

Non-EU students pay the highest fees and are a good source of income for universities. In fact they generate about 32% of universities’ fee income, while making up about 11% of the total undergraduate population. I posted about that here.


[1] Financial health of the higher education sector 2011-12 to 2014-15 forecasts, November 2012 | ref: 2012/30

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