Impact of Government Policies and International Students on UK University Economic Stability

  •  Timothy Scott    
  •  Nathara Mhunpiew    


Numerous UK universities are experiencing financial instability; with an increasingly competitive and maturing market, reliance has grown on international students to offset institutional shortfalls. Dependency on international student tuition revenue has over-exposed the market to dramatic shifts in political policies, both domestic and internationally, that could significantly impact operational success. UK higher education institutions (HEIs) ability to promote their institutions as they are intertwined with the UK government; thus, controversial policies create a backlash, drawing HEIs into disputes as unwanted participants yet recipients of significant economic disruption. Government policies on domestic tuition caps, Brexit, and increasing geopolitical disputes with China have had a considerable impact on institutional operations. This paper recommends HEIs, principally lower-tabled universities, take a more aggressive strategic realignment to best adapt to the marketplace’s uncertainty. By reemphasising institutional specialisation, variable tuition rates for under-represented growth markets, financial support for EU students, increased distance education presence, and intense market-wide lobbying of government MPs, this paper seeks to open a discussion on how to identify existing problems and target opportunities for growth. The complexity of market conditions and the decreasing solvency of many institutions will not be solved by a single recommendation or a short-term policy but by a complete realignment and robust industry-wide initiatives. If universities cease operations or collapse under market conditions’ financial strain, it will impact the overall market’s reputation, reducing UK institutions’ overall desirability as a major exporter of education.

This work is licensed under a Creative Commons Attribution 4.0 License.