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The Guardian - UK
The Guardian - UK
National
Carmen Aguilar García, Sally Weale, Lucy Swan and Harvey Symons

Fifth of UK universities’ income comes from overseas students, figures show

Students sit in a lecture theatre with a person teaching at the front.
Universities say they need fees from overseas students because domestic fees have barely risen since 2012. Photograph: Peter Muller/Getty Images/Image Source

One in every five pounds received by UK universities last year came from international students, according to Guardian analysis that reveals the scale of the sector’s growing dependence on overseas tuition fees for financial survival.

With the annual dash to allocate university places for the next academic year about to begin, there are fears UK students could lose out to their overseas counterparts, whose higher fees have become critical to university budgets.

Tuition fees from international students now make up a third or more of the total income at some institutions, with many universities registering sharp increases in the proportion of their income from overseas students in recent years.

A dozen universities have seen growth of more than 15 percentage points, while the number of international students has increased in about 80% of UK universities since 2016-17, with 30 institutions recruiting double the number of overseas students.

At renowned specialist institutions, such as the Royal College of Art (RCA) and the University of the Arts London, tuition fees from EU and non-EU students made up more than half (54%) of total income in 2021-22, up from just over a third in 2016-17.

Meanwhile, the University for the Creative Arts, which also specialises in art and design, and the University of Hertfordshire have registered the biggest increases in international tuition fee income share, rising from 13% to 33% of total income in six years.

Prof Quintin McKellar, Hertfordshire’s vice-chancellor, said: “Overseas students bring vibrancy and energy to our universities. They support courses which we would be unable to offer to our UK students without their recruitment and they greatly support our university finances.”

The Guardian’s analysis of the latest data from the Higher Education Statistics Authority (Hesa), covering 155 universities, comes amid mounting concern about the growing reliance of the UK university sector on income from international students.

Universities can charge overseas students significantly higher tuition fees. An overseas undergraduate pays on average £22,000 a year, according to estimates by the British Council, which is used to offset the decreasing value of domestic fees that remain capped at £9,250, having barely increased since they were introduced in 2012.

Mark Corver, the managing director and co-founder of dataHE, which helps universities use data, has calculated that, taking inflation into account, domestic tuition fees are now worth about £6,000 in 2012’s money. “Universities have lost a third of their money to inflation since 2012, and most of that loss has been in the last 18 months,” he said.

“I know [the universities] would like to take more UK students, but the finance directors will be saying it doesn’t add up. In practice, they need a higher and higher proportion of international students each year.”

Tim Bradshaw, the chief executive of the Russell Group of research-intensive universities, which attract large numbers of overseas students, said international fees are reinvested into education and research to benefit all students. “However, with government per-student funding falling, this revenue is now being asked to cover increasing deficits in both domestic teaching and publicly funded research.”

The number of international students choosing to study in the UK – many of them postgraduates – has risen by 48% in six years, with some of the largest increases from India and Nigeria, where recruitment agents have worked hard. Numbers coming to study from the European Union have dropped by 14%, while China continues to dominate, accounting for close to a quarter of all international students.

Earlier this year, England’s higher education regulator, the Office for Students (OfS), wrote to 23 universities with the highest number of Chinese students, asking to see their contingency plans in case of a sudden interruption to overseas recruitment.

The chief executive, Susan Lapworth, said the OfS remained concerned that some universities had become too reliant on fees from international students, particularly where large numbers come from a single country. “Universities must know what they would do if international recruitment fails to meet expectations,” she said.

Tuition fees from overseas students have increased by 71% in six years, from £5.4bn in the 2016-17 academic year to £9.7bn in 2021-22. As a result, more than a fifth of UK universities’ total income came from payments from EU and non-EU students (21.5%) last year, up from 15.6% in 2016-17.

“It’s the only thing that makes really serious money,” said Nick Hillman, the director of the Higher Education Policy Institute. Over the same period, the proportion of universities’ total income derived from UK students fees decreased slightly from 30.8% in 2016-17 to 28.8% in 2021-22.

The increase in the RCA’s overseas student population comes largely from China, with six times more enrolling last year than in 2016-17; more than 1,100 compared with 180. Robert Gordon University recorded close to five times more students from Nigeria than six years ago; 1,700 compared with 365.

An RCA spokesperson said: “As the world’s leading art and design university, the RCA attracts students both from the UK and over 70 other countries, and we are proud to have many successful Chinese alumni.

“Our numbers of UK and non-Chinese international students are increasing and forecast to continue to increase in future academic years. Overall, our financial position is healthy and includes research, philanthropy and corporate partnerships.”

The Chinese student population at the University of Central Lancashire has however decreased by 57% in six years, while there are 24 times as many from India than in 2016-17. Chinese student numbers have also dropped by 68% at Sheffield Hallam University, while Nigerian and Indian nationals combined are seven times higher than in 2016-17.

India has become the second largest nationality in UK universities, accounting for 18% of all the overseas students, up from 4% in 2016-17,- followed in third position by Nigeria with 7% of all international students.

Universities UK, which represents 140 institutions, said UK students still constituted the majority of undergraduates, making up 85% of students, and that 39% of all postgraduates were international students. “International students enrich our universities and communities, and the government’s 2019 international education strategy, which committed to increasing the number of international students, recognised this,” a spokesperson said.

Bradshaw said: “Universities will always work to run as efficiently as possible and maximise other revenue streams so they can continue to deliver the best possible student experience. However, as costs rise and deficits grow, universities’ ability to mitigate the impact on quality and choice for students is limited.

“That is why we are calling for a more sustainable approach to funding higher education that can offset the impact of inflation on per-student funding, is fair and affordable for students and the taxpayer, and protects the pipeline of skills to support innovation and economic growth.”

• The first graph in this article was amended on 17 July 2023. An earlier version incorrectly showed the total income of the universities in millions instead of billions of pounds.


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