‘The PM’s 10-year plan must include exploiting the full potential of universities’

The Prime Minister has pledged to deliver a 10-year plan for the UK. If the country is to escape nearly two decades of slow economic growth and weak productivity, we certainly need some bold, long-term thinking.

The UK is navigating rapid social, economic and technological change and now is the opportunity to harness that change, not just for the next 10 years but for generations to come. But if we are to do that, we need to maximise the potential of our world-leading universities. They are uniquely placed to power the skills, research, and innovation that drive growth in every part of the country.

Whether it is AI changing how and what people learn, the need for high-skilled workers to power the industries of tomorrow or tackling the NEETs crisis by giving young people great opportunities through both academic and technical routes, the country needs something different from universities than in the past.

Universities are doing their bit to change. They are transforming how they operate, illustrated not only by recent mergers but by many other forms of collaboration, sharing of facilities, and closer working with civic partners. They are working closely with employers and colleges to meet skills needs – illustrated by our pledge that every student will have access to work experience. We’ve also set an ambitious goal to double external investment into university innovation to £100 billion, to create more home-grown businesses and jobs.

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The willingness from universities to change is there. What the sector now needs is a government to meet them halfway. There are three steps – short, medium, and long term – that it should take.

Short term: pause the international student levy

International students are one of Britain’s great export success stories. The income they bring not only boosts local economies in every part of the country but is critical in cross-subsidising the cost of teaching domestic students and sustaining the country’s research base, both of which are central to economic growth. Taxing international students would simply reduce the amount that universities can spend on supporting all students, including those from the UK, reducing opportunity.

Its impact would also be felt unevenly across the country. The projected burden is nearly three times greater in the Northeast than in the Southeast, concentrated in regions where universities are among the largest anchors of local employment and growth.

In four regions, universities are projected to fall into deficit once the levy applies. That means job losses, course closures and increased fragility. So, at the Budget, the government should decide to pause legislating for the introduction of the levy and work with the sector on alternative ways to fund the maintenance grants the levy is designed to pay for.

Medium term: tie tuition fees to inflation for good

After years of frozen fees, universities are making tough choices that risk impacting the experience today’s students receive. Government teaching investment per student has fallen by 57% in real terms since 2012. The recent uplifts to the fee cap are a welcome first step, and the government has already committed to legislating automatic, inflation-linked increases. This is the right decision. It means that teaching funding won’t continue to decline year after year as it did under the last government. And it is fair to students who will get the same quality of education as those who studied with us in the past. To be clear – all we are asking for is that the fee does not lose value in real terms. 

Long term: a new plan for higher education

No single organisation can deliver the Prime Minister’s ambition for good growth in every postcode, but universities have a central role to play. As part of his 10-year plan, the Prime Minister should commit to working with the sector on a long-term plan for higher education, one that optimises the system so universities can deliver the fullest range of benefits they are capable of, from skills and social mobility to innovation and regional growth. Universities are already evolving to meet the world’s rapidly changing demands, but they need a government ready to work alongside them.

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From his time as Mayor of Greater Manchester, a city with five great universities each playing a distinct role, the Prime Minister has seen first-hand how universities contribute to growth, opportunity and prosperity in the places they serve. The opportunity now is to build that partnership on a national scale.

With these three steps, the government can help universities play their full part in securing a brighter future for the next generation, and in delivering the 10-year plan the country needs.

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