The Government has announced £2.6bn support to protect students and the higher education sector from the impact of coronavirus

@EducationGovUK support package for universities and students – Sector Response 

New measures to protect students and universities, including temporary student number controls, have been announced by the Education Secretary today (4 May), answering sector calls on the Covid-19 response.

Gavin Williamson has announced the package of measures, drawing on proposals from the universities sector, to stabilise university admissions this autumn and to help the universities and students are safeguarded at a time of unprecedented uncertainty.

Through the plans, English higher education providers will be able to recruit full-time undergraduate UK and EU students for 2020/21 up to a temporary set level, which is based on their forecasts for the next academic year, plus an additional 5%. The Government will control these numbers through the student finance system.

The Government will also have the discretion to allocate an additional 10,000 places, with 5,000 ring-fenced for nursing, midwifery or allied health courses to support the country’s vital public services.

The measures aim to allow students, who want to go to university and meet their entry requirements, to access higher education while avoiding competition among providers taking a form which would go against the interests of students and the sector.

Through the proposals from Government and the sector, students will benefit from a new proactive and personalised UCAS Clearing process this summer, which will help to broaden their horizons, and funding to support those in financial hardship.

Science Minister Amanda Solloway has also announced that £100m of public funding will be brought forward to this academic year to help protect vital university research activities. On top of that, an estimated £2.6bn of tuition fee payments will be brought forward to help universities better manage financial risks over the autumn, including taking steps to improve efficiencies and manage their finances in order to avoid cash flow problems further ahead.

The Government has also confirmed that providers are eligible to apply for its support packages, including business loan support schemes, which the Office for Students (OfS) the regulator in England, estimates could be worth at least £700m to the sector, depending on eligibility and take up.

The Government has also published further guidance about how providers should access the Coronavirus Job Retention Scheme to safeguard staff jobs, in particular stating that any grant from the scheme should not duplicate other sources of public funding where these are being maintained, such as UK home student tuition fees.

Education Secretary Gavin Williamson said:

We are committed to supporting our world class universities and students through this unprecedented challenging time. So we are putting measures in place to help protect students and staff from the impact of coronavirus.

I know this is an unsettling time for all involved, and we are working tirelessly with the sector to do everything we can to stabilise admissions and protect a vital part of our country’s economy and society.

I am very grateful to universities for their innovation and dedication in their frontline response at this time.

Universities Minister Michelle Donelan said:

I know this is a very difficult and anxious time for students, universities and higher education staff, and we are working determinedly with the sector and my counterparts across the UK, to support them during this time.

Universities have an integral part to play in our economy, society and culture, which is highlighted now more than ever through their important role in the fight against the virus.

That is why we are introducing a package of measures to boost support for students, stabilise the admissions system and ease pressures on universities’ finances.

Science Minister Amanda Solloway said:

The UK is home to some of the world’s leading scientists and researchers. From the study of disease to vaccine development, their work has already proved itself to be invaluable to our response to coronavirus.

This £100 million we are bringing forward will provide immediate help to ensure the excellent research taking place in our universities continues throughout this period of uncertainty.

Emma Hardy MP, Labour’s Shadow Minister for Further Education and Universities, said:

This disappointing package offers no long-term security to our universities, putting the anchors of our regional economies at risk. Using the Student Premium Funding on student hardship today could further reduce the opportunities for disadvantaged students tomorrow.

The Government must urgently produce a plan to safeguard the future of our universities and ensure that across the UK everyone has the same opportunity to study at university regardless of where they live.

Universities UK President, Professor Julia Buckingham CBE said:

Universities across all four nations of the UK are doing all that they can to manage the impact of Covid-19 on their students, staff, teaching and research, while at the same time making significant contributions to their communities and the national effort to tackle the pandemic.

The package of interventions outlined today indicates a welcome recognition from government of the central role that universities will play in the recovery of the economy and communities and the urgent need to provide support for universities to weather the severe financial storm created by COVID-19. It is clear the government has listened to the concerns raised and has drawn from the suggestions that the sector has made.

Universities will want to examine and understand more fully the details of today’s announcement and then work with government to ensure that detailed measures are developed to meet both the scale and diversity of pressures that universities are facing – including further support to protect the strength, capacity and quality of the research base and ensure the sector is positioned to support economic and social recovery through research and innovation.

Further work will also be needed by the UK and devolved governments to build on the package to ensure that the necessary support is in place for universities in the devolved nations.

Nick Hillman, Director of the Higher Education Policy Institute (HEPI), said:

While we need time to digest the finer details, this seems like a carefully-calibrated package that delivers much of what the higher education sector called for without over-exposing taxpayers.

The positive elements include some easing of cashflow challenges, a reprofiling of fee and research income and a renewed focus on students as well as institutions.

Some research-intensive universities will doubtless wish there was more money specifically for research now, but some of the more routine elements of the announcement – like a working group for research sustainability – could end up as meaningful.

Overall, the measures should give managers and governors the time they need to reset their institutions for the post-Corona world.

The package does not obviate the need for tough decisions. Any institution that faced serious financial challenges before the pandemic will still face them and, even with this new support, the structure of our higher education system is likely to change.

University and College Union general secretary Jo Grady said:

While it is encouraging that the government appears to have recognised the need to provide support for universities, this package does not deliver the protection or stability that students, staff and the communities they serve so desperately need. The Office for Budget Responsibility says universities are most at risk of financial pain from the current crisis and they need more than IOUs to solve the problems they face.

The student number cap is a misnomer as it will enable the wealthiest universities to substantially grow their domestic student base at the expense of other more locally-focussed institutions. We cannot afford to let this dog-eat-dog approach risk substantial damage both to our country’s academic capacity and local economies which universities are such an important part of.

Instead of kicking the can down the road, the government must underwrite funding lost from a fall in domestic and international student numbers and remove incentives for universities to compete against each other at a time when we need to be pulling together.

Claire Sosienski Smith, NUS Vice President (Higher Education) commented:

“Students are the heart of the higher education sector, and it is disappointing to see the government release their plans for a bailout without tackling many of the urgent questions of tuition fee debt write offs and reimbursements.   

“It’s welcome that this package lets higher education providers move money into hardship funding: the £48m this will make available to students will have a concrete impact on the lives of many people who are struggling right now. It’s concerning that this is coming from other pots already in use for funding widening participation activity and students, however: by letting universities and colleges move money around, the government has acknowledged that existing hardship funds are running dry, so now is the time to do the right thing and find new money to give students a safety net of national hardship funding.

“We estimate that almost 40% of higher students have been left unable to access their education online through through their courses being unsuitable for online learning. These students simply cannot access their studios, materials and placements during the pandemic – or they have completed early to work in the NHS. The government needs to stop ignoring the plight of students who are our nurses, midwives, pharmacists and essential workers of the future, and give us all the opportunity to redo the year at no additional cost, or have our debt and costs written off or reimbursed.”

NUS Scotland President Liam McCabe said:

“Today’s announcement leaves many questions unanswered for Scotland’s students, and their institutions. As we move forward, students need to see both the UK and Scottish governments delivering a support package which provides financial stability and security at a time when both are lacking. We expect to see both governments engage meaningfully in the coming weeks to do just that.”

“Coronavirus has hit thousands of students in the pocket, severely affected the quality of their learning, and has created the most adverse economic landscape for graduates in a generation. The outlook for students is bleak, and that’s why we urgently need decision-makers to deliver a student safety net in Scotland, ensuring that no one will fall through the cracks.”

Dr Tim Bradshaw, CEO of the Russell Group, said:

Covid-19 is an awful tragedy that is affecting families across the country, and the health and economic impacts will be with us for years to come. Our universities are playing a significant role in the fightback against Covid-19, but they are already under strain on many fronts and there is no getting away from the fact that financial pressures will escalate in the coming academic year. Today’s measures are an important first step in protecting the skills and expertise that universities provide, which contribute billions to the UK economy. They will also help to maintain the best possible student experience to protect our world-leading reputation, which attracts people from around the globe. Bringing forward tuition fee payments and some recurrent research money will help manage cashflow, but we also need other areas of government financial support such as the CCFF to work better for universities.

The sector-wide agreement on student intakes is designed to reassure anxious students and parents awaiting A-level results. To be clear, no prospective student who makes their grades will be disadvantaged by these temporary changes to admissions in England, which also allow for a margin of growth this year. The proposal on student intakes was put forward by the sector itself, so we hope that additional, albeit temporary, regulatory powers proposed by the OfS to oversee the sector agreement will not need to be used. Governments in the Devolved Nations will also need to consider how they will support their universities and allow additional places for students who will now be an even more important part of the UK’s economic recovery.

The big remaining challenge is to address the financial sustainability of research. Universities face significant shortfalls in international students and other sources of income that we need to underpin vital work that otherwise goes under-funded. The research sustainability taskforce is central to this next phase, and we look forward to helping the Government develop a plan that can release the investment needed to transform our economy while also tackling major health, societal and environmental challenges.

Universities will always do their part – helping the NHS and our communities in the fight against coronavirus, while taking immediate steps to make savings and deliver the best value for every pound we spend. However, the effects of this virus will be long term and it is vital the country is in a strong position to bounce back. The ideas, skills and innovation of our universities, students and staff will be at the heart of this and we will continue to work with the Government to protect those qualities and unleash Britain’s potential.

UCU released a report by London Economics last week that highlighted a £2.5bn loss of income from tuition fees and teaching grants.

The Office for Students (OfS) has today (4 May) warned that it could impose substantial financial penalties on universities and colleges that change their admissions strategies because of financial pressures related to the coronavirus pandemic. 

The higher education regulator for England is consulting on a new regulatory condition that would allow it to intervene where universities and colleges act in ways that undermine students’ interests or threaten the stability of England’s higher education sector during the crisis, allowing it to intervene if universities and colleges act in ways which puts at risk students’ interests, or the stability or integrity of the sector. This could include making unconditional offers or pressuring students to accept places that would not be in their best interest through incentives, such as free laptops.

UCAS Chief Executive Clare Marchant said:

Today’s announcements from the Government and the Office for Students, along with Universities UK’s proposed sector agreement on fair admissions practices, provide further confidence to students that they can progress with their application and benefit from a wide range of choice and online flexible support.

UCAS has given all applicants extra time to make their decisions and we are encouraging them to make their firm and insurance choices as soon as they are ready.

We are confident the new personalised Clearing in 2020 will transform the experience for students. Building on last year’s reforms, they won’t need to search through a mountain of courses or make endless phone calls. The most appropriate course options for them as an individual will be presented through their online account.

Claire Sosienski Smith, NUS Vice President (Higher Education) said:

We need to ensure students’ interests are safeguarded in this challenging time, and understand why these changes have been proposed by the Office fof Students (OfS) – but the language used is very broad and OfS must take great care and provide clear guidance to ensure universities and colleges are not deterred from working together to make changes that support students for fear of regulatory action.

That the OfS felt it had to take this action proves yet again that the marketisation of higher education has failed students and created perverse incentives for institutions. It would benefit students and society far more to promote collaboration and cooperation among universities rather than wasteful competition. Students are ultimately still stuck in a system which threatens their education by leaving it to the whims of the market.

Regulation alone will not address student concerns, and students are suffering in the here and now with uncertainty over their qualifications, disrupted placements and financial hardship. NUS is calling for a student safety net: access to a £60million hardship fund nationwide, an economic package for education leavers and the option to redo, reimburse or write-off: to retake this year at no additional cost if need be, or to have their fees or payments written off or reimbursed. If the government is serious about taking action to protect education, it must protect students too.

Sir Michael Barber, Chair of the OfS, said:

In this challenging time, many universities are contributing brilliantly to tackling the Covid-19 crisis. This condition would make sure that everyone puts students’ interests first and that a few don’t undermine the best efforts of the many.

Nicola Dandridge, Chief Executive of the OfS, said:

During the coronavirus crisis, all organisations will be judged by how they demonstrate a sense of wider social responsibility, and this is as true of universities and colleges as anyone else. We are confident that universities and colleges will want to do right by their students and the wider community in these difficult circumstances. This new temporary regulatory condition is designed to reinforce the socially responsible approach that so many in the sector have already shown.

Universities and colleges are currently dealing with a range of unprecedented challenges as a result of the pandemic, and it is entirely understandable that they will be concerned about the potential loss of income. But there are limits to what would be considered a reasonable response to these concerns.

Applicants need to have confidence that the admissions process will be conducted as fairly and transparently this year as it would be in any other year. Current students need to know that their university will be able to continue delivering high quality courses. And potential future students will be best served by a higher education system that continues to offer a wide range of course options. We are especially concerned that any unfair practices during this crisis could particularly harm the chances of those who are already more vulnerable, at a time when information, advice and guidance is less readily available than might normally be the case.

This new condition would allow us to impose penalties that would cancel out any financial benefit to universities of acting inappropriately, significantly reducing the likelihood of such behaviour occurring in the first place, but allowing us to intervene in a manner befitting the consequences if it did.

We are alive to the concern that our proposals may overstep the mark in curtailing universities’ autonomy. But in these extraordinary circumstances, it is clear to me that the need to protect students’ interests and the stability of the sector is more important, and our strictly time-limited proposals are a necessary and proportionate means to do this.

I know most universities and colleges are committed to upholding the highest standards of probity and good governance during this crisis, and to act with good will to safeguard not only their own interests, but those of the whole higher education sector and students in all parts of it. This new regulatory condition will support that collective effort.

Regulator warns of penalties for recruitment practices that undermine student interests and stability of higher education: The higher education regulator for England is consulting on a new regulatory condition that would allow it to intervene where… https://t.co/tatxnLFo4Y pic.twitter.com/cNmXWGIH1b

— FE News – The #FutureofEducation News Channel (@FENews) May 4, 2020

The Government continues to work closely with the Devolved Administrations in Scotland, Northern Ireland and Wales, to mitigate the challenges the entire UK sector faces as a result of coronavirus.

Education Minister Kirsty Williams emphasised her commitment to working with all governments of the UK and HM Treasury to agree a future settlement saying ‘the scale of the financial support required to maintain stability goes beyond what is available within devolved government budgets’:

We remain committed to supporting our universities in their research excellence, with their UK-leading student experience offer, and as civic institutions responsible to their communities and to the nation.

We have set out a policy statement which covers new and recent actions.

As recognised by the sector across the UK, the scale of the financial support required to maintain stability goes beyond what is available within devolved government budgets, and we remain committed to working with all governments of the UK and HM Treasury on a future settlement.

We look forward to working on a four nations basis as part of the university research taskforce.”

The Welsh Government is enormously grateful for the way higher education institutions in Wales have been dealing with the challenge of the COVID-19 outbreak and working to mitigate the impact on students and staff.

They are working in a way that exemplifies a sense of civic mission, which continues to characterise Welsh higher education.

The Office for Budget Responsibility said education would be the sector hardest hit by the coronavirus crisis, with the impact likely to be felt most by universities.

In January the Education Secretary wrote to the OfS asking it to prioritise funding through the teaching grant to STEM and specialist subjects. This move will be of more importance in responding to coronavirus.

The research funding plans follow the announcement by Government earlier this month that UKRI-funded PhD students whose studies have been disrupted by the COVID-19 pandemic will receive further support, including additional grants of up to six months.

The Government’s key focus will be on ensuring the country’s world-class higher education system delivers for all students and the wider economy. As part of this, it expects all providers and their creditors to behave responsibly.

The Government expects access to the business support schemes, reprofiling of public funding and student number controls should be sufficient to help stabilise most providers’ finances, and that should certainly be the first port of calls for providers. Should that not be sufficient, such that a higher education provider finds themselves at risk of closure, the Government will only intervene further where we find there is a case to do so, and only where it believes intervention is possible and appropriate, and as a last resort. In such instances, the DfE will be working with HMT and other Government departments to develop a restructuring regime, through which we will review providers’ circumstances and assess the need for restructuring. Where action is required, this will come with attached conditions. The Government will work with the Devolved Administrations on this approach.

The full range of measures, bringing together collective action from the Government and sector organisations to help mitigate the impact of coronavirus, include:

• Stabilising admissions – Temporary measures mean providers will be able to recruit full-time, domestic students up to 5% above their forecasts in the next academic year, which is in line with proposals originating from the sector, to help reduce volatility and ensure a fair and orderly admissions. The Government will also have the discretion to allocate an additional 10,000 places, with 5,000 ring-fenced for nursing, midwifery or allied health courses to support the country’s vital public services.
• Preventing exploitative admissions practices – The OfS will consult on a new temporary registration condition so it can intervene if providers take actions that are harmful to the sector and students. 
• Enhanced Clearing process – UCAS is developing a new, personalised Clearing system for students this summer. This includes Clearing Plus, a new service which matches students to universities or other opportunities based on their achievements and course interests. If students’ calculated grades exceed their predicted ones, it can suggest alternative courses with higher entry requirements.
• University research funding – The Government is bringing forward £100m of Quality-related research funding (QR) for providers in England into this current academic year as immediate help to ensure research activities can continue during the crisis.
• Research sustainability taskforce – DfE and BEIS Ministers will set up an advisory sector working group with the Devolved Administrations to consider how best to respond to the challenges universities face on research as a result of Covid-19, and so university research can continue to support the UK’s economic recovery following the crisis.
• Government business support – The Government has confirmed that universities are eligible to apply for the Government support schemes, including business loan support, which the OfS estimates could be worth at least £700m, depending upon eligibility and take-up. Providers can also access the Coronavirus Job Retention Scheme to safeguard staff jobs, including for those with short-term contracts.
• Changes to tuition fee loan payments – The Student Loans Company will bring forward tuition fee payments of students in the in the 2020/21 academic year to providers, expected to be worth £2.6bn, to help cash flow. This will not affect the loan liability, amount of interest charged to students or the timing of their maintenance loan payments.
• Financial opportunities – As part of existing programmes and using established procedures, the DfE will consider purchasing assets, such as land and buildings, where they can be used for new or expanding schools and colleges. This financial year the DfE has budgeted for up to £100m to acquire sites for planned projects across purchases from suitable vendors, including higher education providers among others.
• Financial help for students – The Government has worked with the OfS to help clarify that providers can use existing funds, totalling £46m across April and May, to boost their hardship funds for students in financial difficulty. This can include help for IT equipment and internet access.
• Supporting international students – The UK continues to welcome overseas students, and Ministers are working across Government as a priority to ensure universities can continue to attract international students. DfE and DIT Ministers will also chair a group, including key sector representatives, to consider how the International Education Strategy can be updated to respond to the impact of the coronavirus outbreak. The student number controls will only apply to domestic and EU domiciled full-time undergraduate students in the 2020/21 academic year.