Artikkelit
20.11.2024
UK: +100 days later, by Birgitta Vuorinen
On 4 July 2024, the Labour Party won the general elections in the UK, after spending 14 years in the opposition. Implementation of the Labour Manifesto, Change, started immediately. Now, after more than 100 days in power, it is good to look at these first months. What is there for higher education and research? Can we see the change?
According to Universities UK, during the 2021 – 2022 academic year, the higher education sector supported over a quarter of a million jobs and contributed over £130 billion pounds to the UK economy and universities’ international students make a net economic contribution to the UK of around £40 billion a year. In addition, universities have a strong role in the UK’s success in the field of Soft Power. In October, the Higher Education Policy Institute HEPI published a survey, which shows that 70 serving world leaders received higher education in the U.S. and 58 serving world leaders received higher education in the UK. These proofs of impact are some of the reasons why the higher education sector thinks it should have a strong voice. The higher education sector is often referred to be one of the most successful industries of the UK.
Before the elections, the higher education sector suggested for instance 1) reinstating maintenance grants for those who need them most, 2) ensuring universities are adequately funded to provide high quality teaching, 3) treating R&D as long term capital investment through 10 year funding cycles, 4) supporting the development of partnerships that are integral to the success of local communities, and 5) stable and managed growth in international student numbers, backed by a pledge to maintain the graduate route visa.
First budget brought good news for R&D
One of the first announcements of the Labour Government was to maintain the Graduate Route Visa as it is, allowing international graduates to stay in the UK for 2 or 3 years after the graduation, depending on the level of studies. This is an important tool for universities wanting to attract the best and the brightest students.
Labour Party’s first budget in 15 years was announced on October 30. While the Chancellor, Rachel Reeves, emphasized the importance of fiscal discipline, there is still a strong commitment to research and development (R&D). The government has promised to protect key areas of R&D funding, including the costs of Horizon Europe association. There are no 10-year funding cycle promises, yet, but a record high 20.4 billion pounds will be allocated for research and development in 2025-2026. The Department of Science, Technology and Innovation DSIT will receive 13.9 billion pounds to invest in R&D in 2025-26”, including at least 6.1 billion pounds of support for core research, growing allocations at least in line with inflation. This funding was earmarked to areas like engineering, biotechnology and medical science, for Research England, other research councils and the national academies. The announcement included a 25 million pounds allocation “to launch a new multi-year R&D Missions Programme to solve targeted problems that will crowd in private and third sector investment to accelerate delivery of each mission”, the missions referring to the five Government Key Missions: 1) Secure growth, 2) Make Britain a clean energy superpower, 3) Develop NHS, 4) Make the streets safe, and 5) Break down barriers to opportunities. Additionally, a strategic focus on innovation and technology is highlighted, with investments earmarked for emerging industries like green hydrogen, carbon capture, and life sciences. Despite the high level of investment, the sector is still concerned about the adequacy of funding, particularly with the added pressure of Horizon Europe costs (£1 billion).
More measures needed?
Universities are heavily dependent on tuition fees, paid both by domestic and international students. A recent study published by the Office for Students OfS gives a warning related to reductions in the numbers of students entering higher education.
According to OfS, “without taking steps to address financial risks, OfS modelling suggests that nearly three quarters (72 per cent) of higher education providers could be in deficit by 2025-26, and 40 per cent would have fewer than 30 days’ liquidity.” In addition to the declining number of national students, indicators suggest that recruitment of international students has decreased significantly overall, with 16 per cent fewer applications for visas in 2024 than in 2023. There are examples where the number of students from some countries has decreased by more than 40 per cent. If this kind of sudden decrease would happen with more than one of the top countries sending students to the UK, it would have severe immediate effects on universities liquidity.
The Labour budget with a record high investment in R&D was of course a good news, but at the same time, some elements in the budget, like higher level of the minimum wages and insurance costs and taxes, will also mean higher staff and other costs for already cash-strapped institutions.
In early November, the Labour government announced that from 2025 onwards, tuition fees for domestic students in England will be raised from 9,250 pounds to 9,535 pounds per year. Student maintenance loans will also be raised by 3.1 per cent. While Labour’s decision to allow only a small increase in tuition fees in England is not a complete solution, it sent a message that the government is listening to the university sector.
The Government listened to the sector also when it introduced a new 500 million pound funding for post-graduate education in targeted areas: biological, engineering and physical, and natural and environmental sciences. The funding has been made available to universities and prospective students will apply in the coming months ahead of beginning their studies next year. Over 4,700 newly funded post-graduate places in UK universities will be backed by the government to study biological, engineering and environmental sciences at 45 universities across the UK.
The government has also committed to increasing funding for further education, recognizing its role in upskilling the workforce for new and growing industries. The creation of Skills England just weeks after the general election and extra revenues on further education might also offer welcomed resources to the universities, at least if they manage to develop their provision suitable for upskilling and reskilling. Skills England will administer a growth and skills fund, a levy on large employers now extended to other forms of training as well as apprenticeships. However, some stakeholders expressed a desire for more robust support for higher education to ensure it remains capable of meeting the skills demands of the future.
The Government is planning to publish several policy updates in the beginning of next year. There are also high hopes for the next budget, spring budget.
Text: Birgitta Vuorinen
Sources:
UUKi report: https://www.universitiesuk.ac.uk/what-we-do/policy-and-research/publications/impact-higher-education-sector-uk
HEPI : https://www.hepi.ac.uk/2024/10/10/the-us-pulls-further-away-in-the-latest-soft-power-index-while-the-uk-stands-still-and-france-slips-back/
Office for Students: https://www.officeforstudents.org.uk/news-blog-and-events/press-and-media/bold-and-transformative-action-needed-to-address-financial-sustainability-ofs/
GOV post-graduate funding: https://www.gov.uk/government/news/over-4700-newly-funded-post-graduate-places-in-uk-universities-to-create-new-generation-of-engineers-and-scientists
Photo: Director Erja Heikkinen from the Ministry of Education and Culture, President Paula Eerola and Executive Director Floora Ruokonen from the Research Council of Finland visited London in mid-November. At the Residence of the Ambassador Jukka Siukosaari they discussed about higher education and science policy changes in Finland and in the UK with Director Jamie Arrowsmith (UUKi), President of the Clare Hall College, University of Cambridge Alan Short and Provost Ian Walmsley from Imperial College London. Creidits: Embassy of Finland, London.