Skip to main content

Universities: Coronavirus

Question for Department for Education

UIN 58104, tabled on 10 June 2020

To ask the Secretary of State for Education, what steps his Department is taking to ensure that universities have adequate short-term liquidity during the covid-19 pandemic; and whether he plans to allocate additional funding to that sector.

Answered on

16 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 to monitor the likely impacts including on short-term liquidity.

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 have stabilised the admissions system and will pull forward tuition fee payments, expected to be worth £2.6 billion, for 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.

In England, we will also be bringing 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, 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:

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 intervention is possible and appropriate and as a last resort.

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