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Universities: Coronavirus

Question for Department for Education

UIN 55669, tabled on 5 June 2020

To ask the Secretary of State for Education, what financial support he plans to allocate to universities that lose income due to the loss of international student fees during the covid-19 outbreak.

Answered on

15 June 2020

The government recognises that the COVID-19 outbreak is bringing significant financial challenges to the higher education (HE) sector and we have been working closely with the sector, including specialist providers, to monitor its likely impacts.

On 4 May 2020, my right hon. Friend, the Secretary of State for Education, announced a package of measures to ensure sustainability in HE at a time of unprecedented uncertainty.

We will stabilise the admissions system and pull forward tuition fee payments, expected to be worth £2.6 billion, for HE providers so that they receive more cash in the first term of the 2020/21 academic year. This will have no impact on students but will allow providers to better manage financial risks over the autumn. This will be available to all providers across the UK.

In reprofiling these payments, we are clear in our expectation that providers should use the cashflow benefits appropriately, taking significant steps to improve efficiencies and manage their finances in order to avoid cashflow problems in the future. Reprofiling in this way is a one-off intervention for the autumn term only, to help providers take all necessary steps now to prepare for the future.

On Friday 5 June, the department announced Sir Steve Smith as the International Education Champion, a key deliverable of the 2019 International Education Strategy. Sir Steve will assist with opening up export growth opportunities for the whole UK education sector, tackling international challenges such as those posed to attracting international students and forging lasting global connections.

In England, we will also bring forward £100 million of quality-related research funding for providers to the current academic year to help to address some of the immediate pressures faced by university research activities.

The department will consider purchasing land and buildings where they can be used for new or expanding schools and colleges in England. This will take place as part of existing programmes and using established procedures. This financial year (across purchases from all suitable vendors and including but not limited to HE providers), we have budgeted up to £100 million to acquire sites for planned projects in England. Details are available on GOV.UK at: https://www.gov.uk/government/news/government-support-package-for-universities-and-students.

The government has also confirmed that providers are eligible to apply for its support packages, including business loan support schemes. The Office for Students (OfS), the regulator in England, estimates that this could be worth at least £700 million to the sector. We will only intervene further where we believe there is a case to do so and where we believe that intervention is possible and appropriate and as a last resort.

In such instances, we will work with providers to review their circumstances and to assess the need for restructuring and any attached conditions. The department will be working with HM Treasury and other government departments and with the devolved administrations to develop this restructuring regime.