University tuition fees will increase in England for the first time in eight years as part of a major overhaul of the higher education system, education secretary Bridget Phillipson has announced.
The announcement appears to set Labour on course for a clash with one of their biggest voter bases, students. It follows other groups losing out with 10 million pensioners hit by the removal of the winter fuel payment and wages being hit by the hike in national insurance.
Tuition fees have been frozen at £9,250 since 2017 but will now rise in line with the Retail Price Index inflation from September 2025. Matching them to the current rate of inflation at 2.7 per cent would mean they increase to around £9,500.
In her announcement, Ms Phillipson said that the changes represented “a new relationship with universities” and warned that the sector will need to make changes as part of the package.
“We are determined to maintain the sustainability of our university sector not just for now but for years ahead,” she said.
New Tory shadow education secretary Laura Trott reminded that Keir Starmer promised to scrap tuition fees when he ran for leader of the Labour Party.
She accused Labour of “declaring war on students” and pointed out that the increase “when students can least afford it” was not mentioned in the election manifesto.
It comes amid growing concern over the state of the education sector, with many universities facing financial crisis. As many as 40 per cent of English universities are expected to fall into a budget deficit this year.
Earlier this year, Universities UK called for tuition fees to be “index-linked to inflation, not to address the funding shortfall, but to allow fee income to maintain its real-terms value over time”.
NUS vice president for higher education, Alex Stanley, said: “Higher education is in crisis right now. Students are being asked to foot the bill to literally keep the lights and heating on in their uni buildings and prevent their courses from closing down. This is - and can only ever be - a sticking plaster. Universities cannot continue to be funded by an ever-increasing burden of debt on students.”
Concerns over university finances have been compounded by a drop in the number of international students, who were propping up the sector.
Home Office figures from 2024 showed 16 per cent fewer visa applications were made between July and September than in the same period in 2023.
Bridget Phillipson confirmed the fee rise on Monday afternoon with an announcement on “higher education reform” in the House of Commons.
She said: “Increasing the fee cap has not been an easy decision, but I want to be crystal clear that this will not cost graduates more each month as they start to repay their loans.
“Universities are responsible for managing their own finances and must act to remain sustainable. But members across this House will agree that it is no use keeping tuition fees down for future students if the universities are not there for them to attend.”
Students in England and Wales currently pay £9,250 per year for university tuition, while in Northern Ireland it costs £4,750 for Northern Irish students. In Scotland, it is free to go to university for Scottish students.
The move is likely to provoke backlash as Sir Keir Starmer promised to abolish university tuition fees entirely when he stood to be Labour leader in 2020.
He rowed back on the pledge last year, saying it was no longer affordable as a result of the country’s financial situation, instead promising Labour would come up with a “fairer solution” if it formed the next government.
Meanwhile, the party’s 2024 general election manifesto says the current “higher education funding settlement does not work for the taxpayer, universities, staff, or students”.
“Labour will act to create a secure future for higher education and the opportunities it creates across the UK”, it adds.
