Today the Government announced a package of measures aimed at supporting universities through the Covid-19 crisis.
Universities face a turbulent year ahead, with international and domestic student numbers expected to significantly fall and uncertainty as to when and how the next academic year will start. The extent of the financial impact of Covid-19 on universities is hard to predict with precision, but many in the sector are concerned that the crisis will force job losses and significant cuts to teaching, research and innovation budgets. The worse case scenario could see forced mergers or closures, which may have drastic implications for regions, businesses and communities that rely on their local university.
NCUB strongly supports the calls for a university support package. Universities play a central role in both our society and economy. They change lives through teaching and deliver the skilled, adaptable, collaborative workers our businesses, schools and hospitals need. Their research saves lives, creates businesses and jobs, enriches society and supports business innovation and knowledge intensive growth. Their international success helps secure growth and global influence, whilst simultaneously acting at the heart of their local regions and communities.
We have never needed universities as much as we need them today and will need them tomorrow. UK universities, in collaboration with businesses, are leading the unprecedented sprint to develop a Covid-19 vaccine. They will be at the frontline of supporting young people into a challenging labour market and upskilling and reskilling workers as the economy undoubtedly shifts. They will work with businesses and the Government to help rebuild our society and knowledge-intensive economy in the difficult decade to come.
Support for universities is therefore not just about preventing closures or job losses. It’s about securing a prosperous future, with faster recovery and long-term opportunity.
What support will be given to universities?
The measures announced today are a welcome step towards supporting our universities. The Government has announced that it will bring forward £2.6 billion of tuition fee payments in the 2020-21 academic year to provide stability and help cashflow. This is not new money but advanced payment, and assumes that domestic student numbers meet forecasts.
£100 million in Quality-Related (QR) research funding will also be brought forward to underpin the research base and plug any immediate fall in funds available.
The Government has also clarified that universities are eligible to access government Covid-19 schemes, which include bridging loans for struggling businesses and the job retention scheme.
A student number control measure has also been introduced to ensure that certain parts of the university sector are not disproportionately affected by the crisis.
Will the measures announced today help?
With so many sectors asking Treasury for help at this unprecedented time, the decision to develop a targeted support package for universities demonstrates a very clear commitment to the sector. This commitment will be incredibly important in the turbulent years ahead and should provide reassurance to universities that the importance of their work is recognised by the Government.
The specific measures announced this morning will address some of the challenges universities are facing, but not all. Most notably, they don’t address the fear that far fewer students will choose to go to university in the next academic year. Welcoming fewer international and domestic students will significantly affect universities’ income, reducing universities’ ability to invest in students, research, and collaboration with business and others. Universities will be forced to make exceptionally difficult decisions on what areas to prioritise and which to cut. Inevitably, some universities will be affected more than others.
The Government has announced a task force to review research sustainability and a group to review ways to update the International Education Strategy in light of the ongoing crisis. Research sustainability and international student numbers are probably the two areas of greatest concern to institutions at the moment. Many in the sector will probably await updates on these groups with bated breath, hoping that further support measures will be taken as a result of work by these groups. However, it feels unlikely that this will take the form of a large cash-injection. This means that a fall in income for most universities is still very likely, and ultimately this will impact on what universities are able to deliver.
What strings are attached?
Since the crisis struck, Treasury has had one eye on the immediacy of the challenge and another on longer-term recovery. Any measures taken in the short-term to support sectors has had to align with the Government’s view of the future. It’s therefore no surprise that the measures announced today were coupled with steps that are likely to change the future of many universities.
Most notably, the Government has focused on the sector’s student recruitment and admissions strategies, granting the Office for Students wide-ranging, though temporary, abilities to clamp down on certain recruitment and marketing practices. A consultation on new penalties for admissions practices was also launched this morning. This all points towards greater regulation of the competitive higher education market and will likely impact university autonomy on recruitment and admissions.
Without doubt, universities are on a journey of unprecedented change, with empty campuses and online learning, revised academic calendars, new government policies and uncertain financial pressures. The sector that emerges from this crisis will likely look quite different from the one that entered.
But universities will also be important creators of global change. Positive change. Critical change that will help us recover from this complex crisis.