Opinion
Despite an early summer heatwave and early success in the World Cup, the mood in UK higher education is dark.
The links between Australian and UK universities are strong and there is a lot we can learn from each other. I have come back from a June visit convinced that we should be moving to a more managed system, to support student choice and sustainable universities for the future.
June 2026 marked the ten-year anniversary of Brexit, which for many has turned to “Bregret”. Britain’s GDP has shrunk by between 4–8% over the last decade, business investment is down even more, and the cost of living has increased sharply. Colleagues suggested that I read What if Reform wins? the “non-fiction thriller” by Peter Chappell that everyone seemed to be talking about.
Political instability has resulted in stalled policy-making. While I was there, Labour Prime Minister Keir Starmer stepped down to make way for Andy Burnham, the mayor of Manchester, who first had to get himself elected to Parliament. While the country waited, there was growing frustration. In October 2025, the UK government released a wide-ranging White Paper on Post-16 Education and Skills, but despite its ambition, it remains on the shelf. No legislation has been introduced to implement its priorities.
Meanwhile, UK universities are doing it tough.
The Office for Students says that 45% will be in deficit this year and as many as 24 could go bust. Universities UK reports that over the last three years, 44% of universities have closed courses and 56% have removed module options. In 2025, 15,000 academic jobs were cut.
The right-wing think-tank Policy Exchange released a report in June called Tarnished Towers which sets out a bleak picture of “a university system in melt-down”. It points to rising student debt and a declining graduate premium, and recommends shrinking the sector by 30% over the next five years, to free up money to invest in the higher education teaching grant and in vocational education and more apprenticeships.
UK colleagues really wanted to talk about two big issues – fairer student fees/loans and the stewardship of the higher education system. UK governments have shifted more and more of the cost of higher education onto students over the last twenty years, to the point where politicians of all parties agree that the system is broken. Debate is raging about new approaches and colleagues want to learn from the failures of the Job-Ready Graduates (JRG) package here.
As UK Minister Baroness Jacqui Smith said at the annual Higher Education Policy Institute conference in London, “seismic changes” in society and the economy are “bearing down hard on young people”. With the number of NEETs (people not in education, employment or training) reaching one million and still growing, government knows it needs a “tilt to youth” to tackle entrenched disadvantage and radicalisation.
Data presented at the HEPI conference showed a significant increase in students working while they study and 14% of students relying on food banks – a doubling since 2022. Because of rising living costs, fewer UK students than in the past are going away to university, with more staying closer to home.
In the context of course closures and staff cuts, this has led to an important debate about “cold spots” in UK higher education – geographic areas where options and opportunities for young people are being removed (particularly in the humanities), further compounding disadvantage.
Speaking to Times Higher Education, former UK Vice-Chancellor Rama Thirunamachandran said that the biggest policy mistakes of recent decades were the tripling of student fees in 2012, combined with the removal of student number controls.
Letting the free-market rip had a “corrosive impact” on the sector, and led to a small proportion of universities getting “stronger, bigger, richer at the expense of the rest of the system”. Overall, he says, “marketisation has gone too far, which is fundamentally distorting some of the values of higher education. Universities… whose mission is all about widening access, will simply not be able to carry on in the medium or long term.”
In this system characterised by what one other Vice-Chancellor called “voracious competition”, UK colleagues are increasingly looking for more managed models. They were interested in the Australian Tertiary Education Commission (ATEC), our new “managed growth” funding system, and how to make sure that it didn’t “bake in the strange distortions” of the current moment. They know that growth in international student numbers is not coming back but this is driving even more intense domestic competition. And to top it all off, the UK faces a demographic decline starting in the 2030s.
UK colleagues are talking about a “moment of agency” – a chance to be positive and get on the front foot before things get worse.
But this is not just “telling our story better” – universities have to be ready to change, to collaborate instead of competing, and to engage confidently with new ways of managing the system, with a clear focus on the public good.
With the Australian Government introducing the legislation to implement key priorities of the Universities Accord, including managed growth and needs-based funding, we should be taking the opportunity to set our system up for the future.
We should be managing our system to make sure that we don’t create cold spots and further entrench disadvantage, making sure that as many students and communities as possible have access to opportunity.
Paul Harris is the Chief Executive Officer of the 2050 Alliance.