Critics of the policy – now subject to consultation – say the levy will only heap more pressure onto an already creaking higher education network. At present, only England’s universities will be subject to the charge, as the Office for Students, which will manage the charge, only regulates English institutions.
Official modelling predicts that the change, set to come in from August 2025, will cost universities an annual £330 million. However, under the proposals, each provider will receive an annual allowance to cover their first 220 international students – a move that’s made smaller and specialist institutions breathe a sigh of relief.
But for larger universities with high numbers of international students, the picture isn’t so rosy.
Gary Davies, pro vice-chancellor of London Metropolitan University, told The PIE News the levy would have a detrimental effect on his institution despite being brought in as a flat fee.
“For us the levy means a cut in funding for the very students the levy proposes to support. It will impact what we can offer in relation to student hardship, careers advice, scholarships for underrepresented students,” he said.
Diana Beech, director of the Finsbury Institute at City St George’s, said the details of the policy had been “buried in the Treasury’s Red Book” – largely dodging coverage by the mainstream media.
“This begs the question: why undermine one of the UK’s strongest export sectors without even gaining political credit for it – whether that’s by framing the levy as a tough stance on immigration or as a much-needed boost for disadvantaged students,” she asked.
“By going about this policy in such a hush-hush way, the levy will simply tax legitimate, highly skilled migration under the radar and heap further pressure on universities already in financial distress. Worse still, fixing it as a flat £925 fee per student risks hitting those institutions least able to absorb the cost, given the lack of price elasticity outside the elite end of the sector.”
Why undermine one of the UK’s strongest export sectors without even gaining political credit for it?
Diana Beech, City St George’s
University Alliance CEO Vanessa Wilson warned the levy risked “denting [the] success story” of UK international education – even if the cash raised would go towards a good cause like domestic maintenance grants.”
Wilson said the move would hit universities hard, and pressed for a full assessment of the levy’s effects on higher education institutions before its proposed implementation in 2028.
“Alongside this, the government must explore further ways to soften the blow for professional and technical universities, such as cutting costly regulation and reviewing their participation in the Teachers’ Pension Scheme, which some universities are legally obliged to offer at increasingly expensive contribution rates,” she added.
Malcolm Press, president of Universities UK, pointed out that the UK’s international fees are already high. As a result of the proposed levy, he predicted, English universities would either have to reduce cross-subsidies that support teaching and research, or raise international fees further – which could drive down international student numbers and therefore force institutions to reduce domestic places.
The irony of the levy – which will be used to fund maintenance grants for disadvantaged British students – actually reducing places for home students has been raised before. An analysis by the think tank Public First predicted the levy could shrink domestic places by 135,000.
