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22 August

International students aren’t the problem, higher education is underfunded

Caps on foreign students won’t work.

By Sam Freedman

The return to normal exams after Covid disruptions has led to anguished front pages about students missing out on their university offers. This was always going to happen. The most selective universities have taken up more students than they could cope with over the past few years and need to regularise numbers again as grades drop back.

But Covid readjustments are not the only thing putting pressure on places at selective universities, and competition is likely to get significantly tougher in the coming decade. First, because we are in the foothills of a demographic bulge that has been working its way through the education system. Between 2002 and 2012 the annual number of births in England and Wales went up by 18 per cent. This means between now and 2030 the number of students vying for places will grow year on year, before dropping away again.

As there’s nothing that can be done about population numbers, the media focus is instead falling on the second issue: the growth in international students. This has been dramatic, particularly from outside the EU. Numbers of accepted undergraduate applicants in this group according to Ucas are up 37 per cent since 2012, compared with 17 per cent for UK students. Growth has been even faster for full-time postgraduate students, the majority of whom are now international students, with China and India providing the bulk of the growth. International students are also much more likely to attend the most selective institutions – 55 per cent compared with 28 per cent for UK ones. And they are typically from wealthy families and self-funded, which weakens efforts to diversify higher education by socio-economic status. 

This has been an entirely intentional strategy from universities, and one fully supported by the government, which set a target for 600,000 non-UK students by 2030. That has been met almost a decade early. The reason is obvious – these students are far more lucrative than domestic ones, as they pay three times as much in fees. International applications are expected to go up another 50 per cent by 2026.

As places for UK students get squeezed, some newspapers and commentators are calling for caps on international students as a solution. But a simplistic solution like this would be counterproductive. The tuition fee for UK students has been stuck at £9,250 a year since 2017 and is now worth much less due to inflation. Those international fees have become vital to cross-subsidising places for domestic students. And, of course, international students have wider benefits for the economy and society.

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Moreover, to date, nearly all universities have managed to increase their places for UK students, even while growing international numbers. The exceptions are Oxford and Cambridge where numbers of domestic students have dropped slightly. Oxbridge has unusually tight space restrictions but it’s certainly possible that this pattern could happen elsewhere if UK fees remained fixed. It seems reasonable, therefore, to insist that selective universities do not reduce places for UK students, with the current numbers becoming a floor.

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But ultimately this debate just highlights the wider problems in higher education finance. The front page of yesterday’s Sunday Times featured a number of vice-chancellors explicitly linking the lack of any increase in fees to their need to take more students from abroad. No government is going to want to raise fees but if they just stay at the same level through years of inflation, with government not providing any top-up, then universities that are over-reliant on UK students will simply become unviable. And if it really is politically impossible to raise fees then maybe that signals how we need to try a different approach altogether. Unfortunately, it’s far easier to demand caps on foreigners than have a serious conversation about student finance. But that’s what is needed.

[See also: Do the exam results matter?]

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