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UK universities under financial pressure as past and present policies collide

Date: July 1, 2026.
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The UK’s elite universities consistently figure among the top 10 in world rankings, but cost pressures are threatening the future of other valued institutions in the higher education sector.

Parliament’s Education Committee warned last month that financial challenges were already having serious consequences, including staff redundancies, departmental closures and the sell-off of assets.

Committee chair Helen Hayes, a Labour MP, commented: “The possibility of a major UK university becoming insolvent is a real possibility, not a theoretical warning.”

By some estimates, around 20 per cent of 120-plus universities are struggling to find the required savings.

Some of the challenges have surfaced in recent years and included such unforeseen factors as the Covid pandemic. However, other threats to UK universities and to education as a whole stem from decades of political tinkering, otherwise known as reform.

What education is for

The debate invariably harks back to the fundamental question of what education is for. Is it to broaden the horizons of the individual and provide him or her with the knowledge and critical skills to make sound choices and navigate adulthood?

Or is it a mechanism for supplying bodies to the national economy by providing just the practical and rote-learned skills suited to the world of work and for which the rewards are principally financial?

Previous Conservative governments accelerated the trend, targeting so-called “rip-off” degrees

It’s an argument as old as time. However, in recent decades it has become the focus of a debate over what critics describe as the commodification of education in which students are seen as customers and universities as businesses whose value is judged on how much their graduates can expect to earn.

This trend is one of the root causes of the crisis that the sector faces after years in which many institutions invested to expand, often on the advice of expensive business consultants, and became ever more reliant on high-paying foreign students.

Previous Conservative governments accelerated the trend, targeting so-called “rip-off” degrees that failed to lead to highly skilled professional or business jobs and even denied graduates the capacity to pay off their student loans.

The humanities v. science debate

“Rip-off” or not, when it comes to making savings, it is invariably the humanities that suffer first.

In May, the prestigious University of Nottingham revealed plans to cut around 700 jobs and reduce the degree courses it offers, including the closure of its entire music and modern languages departments.

C.P. Snow described a British educational system that over-rewarded the humanities at the expense of the sciences

The humanities v. science debate is hardly a new one. Back in 1959, the novelist C.P. Snow delivered a lecture entitled The Two Cultures in which he described a British educational system that over-rewarded the humanities at the expense of the sciences.

He described a conservative social and political elite, broadly trained in the Classics, whose ignorance of science and engineering made them unfit to govern in a new world of technology.

It was an era in which Labour Prime Minister Harold Wilson was to evoke the “white heat of technology” in a 1963 speech in which he urged his party and the country to seize the opportunities of a scientific revolution.

The world of work

Those were the days in which only a minority of young people benefitted from a university education, although they increasingly included entrants from more modest backgrounds whose learning was funded by the taxpayer.

The higher education sector expanded under subsequent governments, and today around half of young people attend university.

Some argue that the process has gone too far and that many would benefit by seeking on-the-job apprenticeships and other forms of in-house training that would better equip them for the world of work.

David Goodhart at the conservative think-tank Policy Exchange has argued that getting 50 per cent of 18-year-olds into further education had led to low productivity, poor social mobility and cultural division.

Education in general has become more exam-obsessed, with curricula based on rote-learning rather than inspiring inquiry and critical thinking

Writing in 2020, he noted that more than a third of UK graduates were in non-graduate employment more than five years after graduating. Meanwhile, employers were desperately short of people with higher manual and technical skills.

It’s a sound argument from the perspective of those who believe the benefits of education are principally work and income-related. At its crudest, it amounts to asking whether it is worth teaching history or art to those destined to become skilled plumbers or machine makers.

Perhaps those ‘optional extras’ should be provided at least at secondary schools for 11 to 18-year-olds. But many of these are also run as private business enterprises after years of academisation.

In the process, education in general has become more exam-obsessed, with curricula based on rote-learning rather than inspiring inquiry and critical thinking.

The value of critical thinking

Those universities now looking to their future are now inevitably seeking ways to narrow their own curricula.

In seeking to head off insolvency, they are sometimes hampered by unco-ordinated government priorities.

Andy Burnham
This weekend Andy Burnham called for a fundamental overhaul of education

Having become perhaps overly dependent on foreign students, institutions are now facing a drop in overseas applications after the government imposed visa restrictions with little regard to how universities would meet the loss in income.

Fortunately, there are effective campaigners who defend the value of critical thinking for students and promote a broad education that embraces the humanities as well as the sciences.

They include classicist and broadcaster Mary Beard, who, in her recent book Talking Classics: The Shock of the Old, wittily and knowledgeably explains the benefits of a once-dominant but now declining academic discipline.

A study of Roman and Greek language and history, she argues, can provide a distant mirror in which to examine 21st-century society and its problems and obsessions.

And what of Andy Burnham, the UK’s likely next prime minister, who studied English at Cambridge?

This weekend he called for a fundamental overhaul of education and an end to the dominance of universities in the system that would lead to parity between academic and technical education.

Given his own degree topic, hopefully he will recall the words from Shakespeare’s The Taming of the Shrew that, when it comes to education: “No profit grows where is no pleasure ta’en.”

Source TA, Photo: Shutterstock