July is the season of graduation ceremonies in the United Kingdom’s universities. Vice-chancellors often use their convocation platform to highlight the values of universities and their importance to the nation. This year, however, this higher purpose may be supplanted by immigration rules and university finances.
These issues have been conjoined for nearly half a century. But their relationship has become critical due to tensions within the outgoing Conservative government’s vision for leaving the European Union and the rise of the Reform party, which wants to reduce immigration. Universities hope that a new Labour government, which was elected with a substantial majority on Thursday 4 July, will take a different approach.
Fees for international students
Until 1980, UK universities educated international students in service to the Commonwealth, international development and diplomatic relations. This changed when Margaret Thatcher’s Conservative government introduced tuition fees for international students. Critics expected numbers to decline, but universities ramped up recruitment to replace cuts to their government grant.
At the turn of the 21st century, Tony Blair’s Labour government campaigned to attract international students, including by introducing two-year working visas after graduation. This was intended to bring talent to the UK and enhance its global influence, whilst also generating income for universities.
When Labour left office in 2010, David Cameron’s Conservative-led coalition helped universities to grow, but it removed the right to post-study work visas, reflecting divisions that have increased since the election of majority Conservative governments from 2015.
Between 2001-02 and 2021-22, UK student numbers increased by 18%, from 1.843 million to 2.183 million, and international students by 267%, from 153,000 to 560,000.
Alongside this, universities in England became more reliant on tuition fees from both domestic and international students, which increased from one quarter to two thirds of their income. European Union students increased by 33% during this period, up from 90,000 to 120,000, but this changed once the nation voted to leave the EU.
Brexit
Universities rely on the borderless flow of people and knowledge, so most academic staff, students and graduates wanted to remain in the EU. They were, though, defeated in the 2016 referendum by voters in places that had not benefited from the expansion of higher education. These were often industrial and coastal towns that felt ignored by the Blair and Cameron vision for an open, knowledge-based economy.
Cameron resigned after the referendum result, but the Conservatives retained power under Boris Johnson in 2019. This was achieved by promising a deal for leaving the EU, whose promise was to control immigration by ending free movement for EU citizens while advancing global trade by freeing the UK from EU trade rules.
When free movement ended in 2020, so did subsidies for EU students, but the government re-introduced the right for all students from outside the UK to work for two years after graduation, with the aim of increasing international students to 600,000 by 2030.
In line with the strategy for the wider economy, this was intended to replace declining EU markets and influence through exports and connections worldwide.
Universities have delivered the planned growth within two years, particularly through recruitment from India, which is now the largest source of students for the UK after China. There are nearly two million people of Indian descent in the UK, so students from India often join family and friends, bring family dependants and want to stay after graduation.
Between 2021 and 2023, graduate visa applications increased from 30,000 to 140,000, with 46% of these applications coming from Indian students and 23% of them being linked with dependants. More students from China are applying to UK universities, but they applied for only 10% of graduate visas during this period, 2% of which were linked to dependants.
Rising immigration through student, dependant and graduate routes has made the Conservatives vulnerable to criticism from the Reform party, which is aligned with the nationalist parties gaining influence across Europe. In response, the government stopped providing visas for dependants of most international students at the beginning of 2024. It then commissioned a rapid review by its Migration Advisory Committee, with the expectation that this would inform their withdrawal.
Going into deficit
Although the review did not ultimately support change, the uncertainty about future policy appears to be affecting recruitment. There was a small increase in applications from international students to the January 2024 deadline for UK universities, but a reduction from India.
Analysis by the higher education regulator in England suggests that if there is no growth in UK or international students and no cost reduction measures, universities will fall £3.3 billion (US$4.2 billion) below their income forecasts by 2026-27, placing two thirds of them in deficit.
Due to tensions within the party’s strategy for leaving the EU, the Conservatives elected their fourth prime minister since the referendum in 2022. Rishi Sunak was the UK’s first prime minister of Indian descent and had also benefited from an international education at Stanford University in the United States.
Notwithstanding this, he spent the 2024 general election campaign promising to reduce university entry and graduate visas, with the aim of defending his party against Reform.
Keir Starmer’s Labour government wants a more constructive relationship with universities, action to address their financial problems and a closer relationship with the EU. Labour is, though, alert to the rise of nationalist parties across Europe, so they have promised more effective immigration controls.
Recent experience in Australia suggests that a shift to centre-left government may be no more favourable to international student recruitment.
As the UK enters a new political era, vice-chancellors have more confidence that their government understands the importance of universities to the nation, and why international partnerships and students are crucial to their success. They will, though, need more detail on the new government’s approach to immigration and university finances before convocations return to a higher purpose.
Chris Millward is professor of practice in education policy at the University of Birmingham, United Kingdom. E-mail: c.millward@bham.ac.uk; X: @millward_Ch
This article is a commentary. Commentary articles are the opinion of the author and do not necessarily reflect the views of University World News.