Tag: living

  • What today’s report on living costs means for students, universities and parents – and policymakers

    What today’s report on living costs means for students, universities and parents – and policymakers

    • HEPI Director, Nick Hillman OBE, takes a look at why today’s landmark report on student maintenance from HEPI, TechnologyOne and the Centre for Research in Social Policy at Loughborough University is so important.
    • Later today, HEPI will be hosting a free webinar with UCAS on this year’s admissions round – see here for details and to register for a free place.

    A recent Wonkhe article by Will Yates of Public First noted, ‘It really was not that long ago that maintenance grants were the norm and student life was cheap and cheerful.’ We probably all know what he means.

    When I went to the University of Manchester 35 years ago, I had no tuition fees and got to collect a grant cheque even though my parents were in secure middle-class jobs. Since then, life has become harder financially for students. Costs have gone up and grants have disappeared (in England). Meanwhile, the student body has diversified to include more people from disadvantaged backgrounds.

    As if battling with the impact of COVID on their secondary schooling was not enough, today’s students face big financial obstacles. During my nine years as a Trustee of the University of Manchester (which sadly came to an end last month), I regularly ascended those same stairs I used to climb to collect my physical grant cheque in order to attend Board meetings at which we would discuss student poverty and its impact.

    Will Yates’s conclusion needs qualifying of course. Just as it is true that there are today many poor pensioners alongside all the well-off ones who have cleaned up thanks to intergenerational inequities, so there have always been some students who struggled to survive on the maintenance support they received. I recently stumbled across the following exchange in Hansard from 1969, for example, on whether parents were making up the income of their student offspring in the way they have long been supposed to:

    Mrs. Shirley Williams: I appreciate that students who do not receive the full parental contribution often suffer hardship. My Department recently wrote to local education authorities asking them to ensure that parents were made aware of the importance of making up the student’s grant. But I do not think it would be desirable or practicable to impose a legal obligation on parents to make their contributions. (Source: Hansard, 30 January 1969)

    Plus ça change… Aside from the reference to local education authorities (which no longer have a role in student maintenance), the answer could have come from pretty much any one of the last seven decades.

    These issues are topical in part because the threshold at which parents are expected to start contributing to their adult student offspring’s living costs has not increased for over 15 years – it was set at £25,000 for England by Gordon Brown (six Prime Ministers ago…). So parents in English households on just over £25,000 a year are expected to cough up – the situation is even worse elsewhere (just over £19,000 in Northern Ireland).

    The recent HEPI / Advance HE Student Academic Experience Survey shows over two-thirds of full-time undergraduates now do paid work during term time, and often at a dangerous number of hours (‘dangerous’ in the sense of impacting their academic work). So what has changed is the proportion of students who feel wickedly under-resourced financially.

    The biggest lie told about students today is that they are pathetic ‘snowflakes’ who melt on contact with real life; in fact, when financially challenged, they tend to confront the problem head on by going out and finding paid work. Norman Tebbit would have been proud.

    While my generation of students were debating or politicking or going to gigs, today’s students are more often serving those who do have the money to go out. In the UPP Foundation / Public First research that Will Yates was writing about, the students said they thought ‘it was them (rather than the university, the government, the OfS or any other body) who took responsibility for ensuring that they could afford to study and socialise.’

    In my view, one of the very best projects we do at HEPI is the HEPI / TechnologyOne Minimum Income Standard. This is completely different to the student money surveys that ask students what their income is and how they spend it. Those are useful but only up to a point because what if the income is not enough? Knowing I have X pounds and spend X pounds is only of modest value if I actually need 2X pounds in order to afford the bus to campus, join my favourite student society and buy personal healthcare items (on this, see HEPI’s recent report by Rose Stephenson on menstruation and learning).

    So the Minimum Income Standard starts with a blank sheet of paper plus a tried-and-tested methodology developed by the Centre for Research in Social Policy at Loughborough University to consider how much students really need to live with dignity – the calculation is not for a plush lifestyle nor a monastic one, but rather for a fairly basic-but-safe one and is based on the extensive experience of the research team as well as detailed focus groups with multiple students around the UK.

    This year, the second such study dwells upon first-year students in Purpose-Built Student Accommodation (university halls and privately-owned student accommodation blocks). So it supplements last year’s study of second and third-years in shared ‘off-street’ housing. (In my view, it should really be called ‘on-street’ housing as it tends to be on normal residential streets, but I digress.)

    While TechnologyOne have generously funded this vitally important work, I must stress that neither they nor HEPI have had any editorial control over the core central numbers, which are entirely Loughborough’s work and based on what students have told them. HEPI’s input has included feeding in supplementary figures for accommodation costs , with the help of Student Crowd and Students, and thinking through the possible policy consequences of the research.

    The top-level finding is that first-year students living in halls need £418 a week – over £20,000 a year and double the maximum maintenance support package in England. Even if a student (in England, living away from home and studying outside London) is in receipt of the maximum maintenance loan, they need to work 20 hours a week throughout the year to earn enough money to hit the Minimum Income Standard. Remember, these are people on full-time courses. As a society, we are now expecting people to do full-time study and half-time paid work and then we wonder why young students struggle to feel a sense of belonging to their institution…

    People should look carefully at the methodology and conclusions to see if they agree with them. As a think tank, our job is to make people think; we can identify the main challenges and propose solutions but we are not a lobby group, so we would never claim we have all the answers. There may be elements of the Minimum Income Standard for Students that people want to pore over, challenge and improve.

    Some of the issues people may want to consider on the back of the MISS include:

    1. As the report makes clear, student life is generally a temporary phase that lasts no more than three or four years. So is it reasonable to apply the same methodology as is used for defining the basic minimum income for someone in work or in retirement? It is valid, in my view, because three years still represents a substantial proportion of a young person’s life up to that point and undergraduate study is often the first period of real independence for people – plus some other phases of life for which the minimum income methodology has been applied are also not always very long term. For example, someone on a ‘living wage’ is likely to hope to rise above it in due course as they gain experience. Besides, in one sense, no phase of life is permanent.
    2. A second important question is whether letting students define their own minimum standard of living via focus groups will always tend towards larger monetary sums. The Minimum Income Standard for Students assumes students are likely to have gym membership, a short UK holiday and other costs (like wireless headphones, a modest alcohol budget and food for takeaways) that some people may deem to be non-essentials or at least not things that should be subsidised by taxpayer-funded income-contingent student loans (though, on the other hand, we only include very small sums for study-related costs). The MISS also includes some costs than some people might deem relevant only to a minority of students (such as paying to store items between terms). But the MISS is about having enough money for every student to live reasonably, with dignity and safety; it is not designed to be a ‘bare minimum’ or to represent the lifestyle of an ascetic. This is one of a number of reasons, further explored below, why we studiously avoid ever saying we think the Government should automatically set the maximum maintenance package at exactly (or even roughly) the level of the MISS. Moreover, students are not spendthrift – one interesting change this year compared to last, for example, is that they no longer deem a TV Licence as a must-have item so it has been removed from the calculation.
    3. What we call a ‘minimum’ is also an ’average’; some cities are notably more expensive than others – London aside, we generally ignore this in the calculation and so the MISS might look too high or too low depending on where someone is studying and their own personal circumstances. For example, this means some of the freebies – such as prescriptions and bus travel – enjoyed by many Scottish students are ignored.
    4. Should we be looking to reduce costs by giving applicants and students better information? A modest amount of the first-year premium (the extra costs that first-years seem to accrue) comes from being unused to budgeting and feeding themselves. The MISS for first-year students even includes a small additional sum for the first 12 weeks while students settle down and get used to things like eating up food before it goes off. Would better information of the students are crying out for fix at least some of the need for this? Similarly, would better information on the different consequences of different accommodation preferences shape better decisions, which in turn could shape the supply of student accommodation, and lead to a reduction in the MISS?
    5. One particular policy challenge is explaining how any extra student maintenance support that could be offered now or later is likely to be spent in practice. Ministers will be less likely to give students improved maintenance packages if they think they will be entirely swallowed up by higher rent levels. One real challenge here, as so often, is that student accommodation tends to fall through the cracks in Whitehall, so it is not always clear who should be approached for these conversations.

    Above all, HEPI is a policy body so for us the key question is always: what are the possible policy ramifications? On this, and notwithstanding the important fact that the report gives a clear indication of a preferred direction of travel, we are still working them out.

    For example, the report concludes that the maximum maintenance package is only half of what students need to live. It clearly needs to be higher and available to more people. It would be absurd (literally absurd) to think parents could easily fill in the gap from their take-home pay unless they are on very good salaries indeed. It is similarly absurd, however, to think the Government can easily fill the whole gap, given the fiscal situation and the much larger number of students than in the past.

    So what level of paid employment is it reasonable to assume students might do (and in holidays or term-time or both)? Or should students opt for a more basic standard of living (no en suite perhaps or more shared rooms, as in the United States)? Or should more students live at home as commuter students but at the cost of experiencing a full traditional student experience? These are difficult questions and, again, the answers will be different in different cases. Nonetheless, we welcome all thoughts in response.

    As I sometimes say when speaking in schools, if and when it comes to my own children going to higher education, I will tell them three things:

    1. good social spaces are more important than things like en suite facilities – if you are living a full student lifestyle, you may spend less time in your room than you originally expected;
    2. taking a temporary full-time job in the holidays is generally preferable to doing a high number of hours of paid employment during term time, if you’re lucky enough to have the choice; and
    3. in general, it tends to be better not to be a commuter student, unless there are specific individual reasons for being one.

    Yet like most parents, I will also have to accept they will take what I say with a large pinch of salt and then find their own way.

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  • Living in an expertise economy – Campus Review

    Living in an expertise economy – Campus Review

    Corporate learning expert and former chief strategy officer at Southern New Hampshire University Kelly Palmer shares the ideas from her new book, The Expertise Economy: How the Smartest Companies Use Learning to Engage, Compete, and Succeed in this episode.

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  • Universities should face the consequences for misleading students over the cost of living

    Universities should face the consequences for misleading students over the cost of living

    Why do students run out of money? And is it their mistake?

    It’s partly because student maintenance support has not kept pace with the cost of living.

    Last year, the Centre for Research in Social Policy (CRSP) at Loughborough University calculated that students need £18,632 a year outside London (and £21,774 a year in London) to have a minimum acceptable standard of living.

    But if you’re living away from home in England, the maximum maintenance loan is £10,227 – and it’s less than that once your parents earn over £25,000.

    And if you’re an international student, the Home Office’s “proof of funds” figure – the money you need to show you have in the bank to cover your living costs – has been (un)helpfully aligned to that inadequate figure.

    In that scenario, you’d need help with budgeting – especially if you’ve never lived away from home before, if you’ve not participated in higher education before, or if you’ve never lived in the UK before.

    You’d want to know, for example, how much a TV license costs. The good news is that your chosen university has a guide to student living costs, and it lists the license as costing £159 per year.

    The problem? £159 was the 2021 rate – a TV licence now costs £174.50. Still, one little mistake like that isn’t going to break the bank, surely?

    Delay repay

    Over the past few years I’ve whiled away some of my train delays surfing around university websites looking at what the sector says about student cost of living.

    I’ve found marketing boasts dressed up as money advice, sample student budgets that feature decades old estimates, and reassuringly precise figures that turn out to be thumbs in the air from the ambassadors in the office.

    Often, I find webpages that say things like this:

    The problem is that the “fact” turns out to be from 2023, the source on the “lowest rents” claim turns out to be “not yet reliable”, and the “one of the cheapest pints in the country” claim has its source this story in the Independent. From 2019.

    That’s also a webpage that says you can get a bus to the seaside and back for £4.30 (it’s currently £12), a ferry to Bruges for £50 (the route was withdrawn in 2020), and a train to London for “for just over a tenner” – when even with a railcard, the lowest fare you’ll find is £22.66.

    Campus gym prices are listed as less than £20 a month (it’s actually from £22.95 for students), rent for a one-bed city flat is listed as £572 (the source actually says £623.57), and you’re even told that you can head to a “legendary” local nightclub to “down a double” for £1.90.

    Sadly, even Spiders Nightclub is having to cover “the increasing cost of basic overheads” and “the ongoing inflationary cost of purchasing stock”. The current price is £2.50.

    Those were the days

    Sometimes, I find tables like this – where the costs listed appear to be exactly the same as when the webpage was updated in 2022.

    HERTS 1

    Actually, that’s not quite true. Someone has bothered to update the lower rent estimate up to £500 a month since then – leaving all of the other figures unchanged.

    Archive.org allows me to see all sorts of moments when someone, somewhere, has performed an update. Of sorts.

    Here’s one where food and rent have gone up, but everything else is as it was in 2022. The main difference is that the “Yearly costs for students” lines in the table have been deleted – presumably because they would stretch credibility.

    Not every university has a run at listing costs. Many (over 30 at the time of typing) refer their readers to the Which? Student Budget Calculator.

    The Which? Student budget calculator was deleted in 2022 – and even when it was live, its underpinning figures were last updated in 2019.

    Sometimes the google search takes you to undated slide decks and PDFs. This metadata suggests that this one is from 2023 – although the figures in it look suspiciously similar to the numbers in the UG prospectus in 2015.

    To be fair, that’s a university that has at least got an updated chart showing sample costs in its international arrival guide – with a reassuring note that average costs are correct as of March. You’d perhaps be less reassured to find that those average costs – other than the cost of (university) accommodation – have remained exactly as they were since last year.

    Sometimes, a picture is painted of painstaking research carried out by dedicated money advisors. Here’s a table that says the minimum costs have been estimated by the university’s support teams:

    How lucky students in that city are, given that the only things that have increased over the past year are accommodation and rent:

    Actually, tell a lie. Many of the costs seem to be identical to those in 2020:

    Save us from your information

    Lost of the sample budgets and costs are unsourced – but not all of them. A large number quote figures from Save the Student’s student money survey – which last year used responses from 1,010 university students in the UK to calculate the results.

    Even if that was a dataset that could be relied upon at provider or city level, that was a survey that found 67 per cent of students skipping meals to save money, 1 in 10 using food banks and 60 per cent with money related mental health problems. Not a great basis on which to budget, that.

    Others quote their costs from the NatWest Student Living Index – which for reasons I’ve explained in 2024, 2023 and 2022, isn’t an approach that I think comes close to being morally sound.

    Plenty of universities don’t list costs at all, but imply to international students that the “proof of funds” figure has been calculated by Home Office officials as enough to live on:

    It has, of course, just been copied across from DfE’s maximum maintenance loan – a figure widely believed to be wholly inadequate as an estimate of living costs for students.

    Sometimes you find things like this, a set of costs “based on feedback from our current international undergraduate and master’s students”. Someone has gone in and updated the costs for university halls – but hasn’t updated anything else, and nor have they updated the estimate for total monthly living expenses:

    Sometimes you find things like this – costs that haven’t changed in two years contained in an official looking document called “Student Regulations and Policies: Standard Additional Costs”:

    And sometimes you find miracles. Here’s a university where most of the costs haven’t increased in 18 months, and the cost of clothing has fallen dramatically – despite ONS calculating that clothing inflation is currently 5.9 per cent.

    Then there’s charts like this that are “subject to change” – although no change since last summer:

    Or unsourced tables like this, where somehow student costs have started to fall. I want to move there!

    2024. Here’s 2025:

    The long arm

    The good news for prospective students – and the bad news for universities – is that this is all now going to have to change.

    Looking at all of this through the lens of the new Digital Markets, Competition and Consumers (DMCC) Act, it’s hard to avoid the conclusion that universities have been sailing remarkably close to the wind – and that the wind direction has now changed dramatically.

    Under DMCC, the systematic provision of outdated cost-of-living information would likely constitute a serious breach of consumer protection law. The Act makes it automatically unfair to omit material information from invitations to purchase – and there’s little doubt that accurate living costs are material information for prospective students making decisions about whether and where to study.

    Crucially, there’s no longer any need to prove that students were actually misled by the information, or that it influenced their decision-making. The omission itself is the problem.

    The legal framework has fundamentally shifted in universities’ disfavour. The scope of what counts as material information has expanded beyond those categories defined by EU obligations, while misleading actions are no longer restricted to predefined “features” of a product or service.

    Instead, any information relevant to a student’s decision can now trigger a breach – meaning universities can no longer rely on narrow, checklist-based approaches to compliance. Outdated transport costs, inflated claims about local entertainment prices, or misleading accommodation estimates all fall squarely within this expanded scope, even though they might previously have been considered peripheral to the core “product” of education.

    The Act has also lowered the threshold for proving breaches of professional diligence. Previously, universities might have argued that minor cost discrepancies didn’t cause “material distortion” of student decision-making. Now, practices need only be “likely to cause” a different decision – shifting the focus from proving impact to ensuring accurate practice from the outset.

    The Act explicitly recognises that certain groups of consumers are particularly vulnerable, and that practices which might not affect others can cause disproportionate harm to those groups.

    International students – who rely heavily on university cost estimates for visa applications and have limited ability to verify information independently – are a textbook example of vulnerable consumers. So too are first-generation university students, those from lower-income families, and young people making major financial commitments for the first time. The Act requires universities to proactively identify and mitigate risks to these vulnerable groups as part of their duty of care.

    The Competition and Markets Authority now has significant new enforcement powers, including the ability to impose civil penalties of up to 10 per cent of an organisation’s turnover and to hold corporate officers personally liable where they have consented to or negligently allowed breaches to occur.

    Given the sector-wide nature of these problems, and the ease with which accurate cost information could be obtained and maintained, it would be difficult for universities to argue that continued reliance on years-old estimates meets the standard of professional diligence now required by law.

    The sector has had years to get this right voluntarily. With enhanced legal obligations, fundamentally expanded definitions of what constitutes actionable information, lowered thresholds for proving breaches, and much sharper enforcement teeth now imminent, universities that continue to present outdated or inaccurate living costs as current information may find that their casual approach to accuracy has become a rather expensive mistake. Their mistake.

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  • International students benefit local economies, and this extends to those living and working there

    International students benefit local economies, and this extends to those living and working there

    Universities once again find themselves in the crosshairs of a political argument around migration.

    I suspect no one on these pages needs convincing of the benefits international students bring to the UK: the diversity and vibrancy they add to our campuses, the fees that help our finances add up so we can carry out research and teach home students, the wider economic impact they bring through their fees and their spending in the UK economy, and the long term soft power of goodwill and friendship that our international alumni generate.

    And there is plenty of public opinion research – for example from Public First and UUK in 2023, from King’s College London in 2024, and from British Future in 2025 – that shows that the British public supports international student migration, thinks it brings economic benefits, and doesn’t see cutting numbers as a priority.

    But we have to be clear that we are losing the political argument on the value of international students – as have our HE colleagues in Canada, Australia and the US in recent months.

    A local industry

    This is the case despite the hard facts we have about the positive impacts of international students, including the £42 billion aggregate (2021–22 numbers) annual economic benefit estimated by London Economics. But those facts may not be enough as the political climate changes; we need to be agile in responding to where the political debate is moving.

    For example, we understand that the aggregate economic impact of international students is not disputed within the government. But they are not convinced that positive impacts are felt at the local level. So what do these big, aggregate numbers mean for citizens at the local level? To address that question, the University of York commissioned some rapid work from Public First – building on the London Economics modelling – to show the benefits of international students at constituency level, both as an export industry, and in their impact on domestic living standards.

    The first part of this work was published a few weeks ago at the heart of the debate around the final stages of the immigration white paper. This showed that international higher education is one of our most important export industries. This was counterintuitive for many politicians – who generally think of exports as goods or services which we trade overseas. But in fact, every international student coming and living in the UK is an “export” – bringing in foreign currency and supporting our economy.

    Politicians rightly champion our other UK exports – our cars, our pharmaceuticals, our creative industries. But across the country, higher education is just as, if not more important. We showed that in 26 parliamentary constituencies around the country, higher education is the single largest export industry – and it is in the top three in a total of 102 constituencies, spread around the country. To put it another way, in many towns and cities, higher education is the car plant, or the steel mill, or the pharmaceuticals factory that drives local economies.

    We hear that this evidence of real local impact was significant within Whitehall, and contributed to seeing off some of the wider proposals for restricting student flows that could have been in the immigration white paper.

    Pounds in pockets

    The second half of this research, published today, takes on some of the critique we know has been advanced in government in recent months: that while students may bring economic value in some abstract, aggregate way at national level, there are costs that are felt locally in our towns and cities that reduce living standards.

    Our analysis comprehensively debunks that. Instead, we show that international students are net contributors to the taxpayer, and that at the local level they raise wages and living standards for domestic residents. We calculate that every worker in the UK has higher wages to the value of almost £500 a year purely as a result of international students’ economic contribution. And in more than 100 constituencies, the benefit is much larger, equating to more than two and a half weeks’ wages for the average worker.

    These local-level impacts are often well-recognised by MPs and councillors. They are not yet in national-level debate. So we will continue to make the case for the wider benefits of international students for our towns and cities as well as abstract national GDP figures.

    In addition, we need to push back against the misguided assumptions in the white paper that the proposed new international students levy would have only a minor impact on recruitment, and show in detail why the reduction in numbers would be large, and carry with it an economic loss that would go way beyond universities’ gates and into their local communities. We are pleased to be working alongside colleagues in the sector to do just that.

    In all this we need to recognise the politics of the moment. All governments are political. That is how they got there, and to be so isn’t wrong! We have a government focused at the moment on its electoral prospects, and many of its actions can be explained by a drive to keep its voting coalition together, especially with the insurgent threat of Reform, and especially on the highly politicised issue of migration.

    Universities are well advised to steer clear of party politics. As a vice chancellor, I work without fear or favour to support the needs of staff and students, but also the city and communities around York. But my academic background is as a political scientist so I’m a keen observer of how universities, migration, and their intersection have electoral significance. So, looking at the 100 constituencies we identify in our research which benefit the most from international students either as an export, or in rising domestic wages, it is noteworthy that over 80 per cent of those constituencies are currently held by Labour MPs, often by very narrow margins.

    In those and the many other constituencies where international students bring real, tangible economic benefits, it is important that local citizens and political representatives understand what is at stake when widely held public concerns about migration lead to the targeting a group – international students – who the public both think highly of, and who make a big contribution to local economies.

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  • How cost of living is influencing UK student mobility

    How cost of living is influencing UK student mobility

    Drive along any motorway in September and you will see car after car full of duvets, pots and pans, and clothes as students head off to pastures new. I remember my own experience, crossing the Severn Bridge with the bedding on the front seat of my Fiesta muffling Oasis’ Definitely Maybe.

    This stereotypical view of a literal journey into higher education isn’t the case for everyone, however. In fact, far more students live at home during their studies than you may think.

    The UCAS application asks students about whether they intend to live at home. In 2024, 30 per cent of UK 18-year-olds said they planned to live at home during their studies – up from 25 per cent in 2019 and just 21 per cent in 2015.

    However, when we look beyond the headline numbers, over half of the most disadvantaged students (IMD Q1) live at home during their studies, compared to fewer than one in five of the least disadvantaged (IMD Q5). Regional distribution will have an impact here, particularly London.

    Scottish students are more likely to live at home during their studies. On a recent visit to Edinburgh, all the students I met spoke with excitement about their plans to study at their chosen university within the city. By contrast, Welsh domiciled students are the least likely to live at home during their studies.

    In London, 52 per cent of 18-year-olds progress to HE – with around half of those students staying in London, making it unsurprising that the capital sees the highest proportion of live at home students in England.

    Cost of living pressures

    Cost of living is undoubtedly influencing student choice. At the January equal consideration deadline, UCAS saw a 2.1 per cent increase in the number of UK 18-year-old applicants – a record high. However, regular readers of Wonkhe will know this also represents a decline in the application rate – the proportion of the 18-year-old population applying to HE, and UCAS insight increasingly points to the cost of living playing a role.

    Our latest survey insight suggests that 43 per cent of pre-applicants feel they are less likely to progress to HE due to cost-of-living pressures, up from 24 per cent in 2023 – although their commitment to going to university remains high.

    Financial support is also of growing importance to students when it comes to deciding where to study. While finding the perfect course content was the most important factor when shortlisting universities (49 per cent), the financial support available while studying (such as a scholarship or bursary) was a close second (46 per cent). Specific cost-of-living support offered by universities was third (34 per cent).

    The availability of support with the cost of living has risen in relative importance as a factor when shortlisting universities from 12th in 2022 to 3rd in 2024 – a significant shift, which suggests a change in student mindset. There have also been large changes in rank importance of “universities that are close to home” from 9th to 4th, “universities with low-cost accommodation” from 13th to 7th and “universities I can attend but still live with my parents” from 16th to 11th.

    Source: Potential applicants for 2025 entry, 1,023 UK respondents, Dec 2024–Jan 2025

    It isn’t just at the point of application where we see the cost of living impacting choice. In 2024, UCAS saw 43,000 students decline the place they were holding in favour of an alternative institution or subject – making this the largest group of students using Clearing.

    This is not a spur of the moment decision, with 52 per cent having already decided to do this prior to receiving their results and a further one in five considering it based on their results.

    When asked what drove their decision, 23 per cent told us they had a change in personal circumstances and 17 per cent wanted to live somewhere cheaper. We also know this impacts on all cohorts of students – 19 per cent of international students that don’t accept a university offer through UCAS tell us they have found a more attractive financial offer elsewhere.

    However, the primary reason that students use Decline My Place is linked to the course, with 31 per cent changing their mind about the subject they wish to study.

    Support measures

    It’s clear that cost of living and financial support is a key factor influencing student choice and so we must ensure this information is easily accessible and understood by students.

    Students tell us they’d like more practical information about student discounts, financial support packages or bursaries/scholarships. UCAS will shortly be launching a scholarships and bursary tool to promote these opportunities to students.

    Around half of offer holders in 2024 recalled receiving information about cost of living support. This presents a timely opportunity for any university staff working in marketing, recruitment or admissions to ensure information about financial support is easy to find on their website, along with information about timetabling to help students understand how they may be able to balance work and study commitments.

    There will be certain groups of students that are even more acutely impacted by cost of living challenges. Last cycle saw a record number of students in receipt of Free School Meals – 19.9 per cent – enter HE. Whilst it is only a small part of the puzzle, UCAS has removed the application fee for these students.

    Cost of living pressures are likely to persist, with students continuing to assess the value of HE in this context. The sector should continue to highlight the benefits of university study as a vehicle for social mobility, along with the graduate premium – the higher earnings they typically earn compared to non-graduate peers. But we also need to make it clearer how HE of all forms remains accessible – from funds for travel to open days, to in study commuter breakfasts, hardship funds, cost of living support, and high-quality careers guidance to support graduate employability.

    This article is published in association with UCAS. It forms part of our ongoing series on commuter students – you can read the whole series here. 

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  • Living Joyfully: Teachings by Thich Nhat Hanh (Plum Village)

    Living Joyfully: Teachings by Thich Nhat Hanh (Plum Village)

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  • We are living through the legacy of unrestrained borrowing

    We are living through the legacy of unrestrained borrowing

    On 1 January 2018 the Office for Students took over the regulation of higher education in England from its predecessor (the Higher Education Funding Council for England (HEFCE)).

    One little discussed impact of this change was an avalanche of university borrowing that has dramatically shifted the priorities and risk profile of English higher education.

    Terms and conditions

    As late as the 2017 memorandum of assurance and accountability between HEFCE and higher education providers, the regulator had the right of veto over university financial commitments over a certain level. If you wanted to borrow money, and you were talking “serious money” in relation to the size of your provider, the regulator needed to sign it off.

    That year written approval was required where total financial commitments exceeded six times the average adjusted net operating cashflow (ANOC) from July – or where the provider was assessed as being “at higher risk”. The year before, it was required when borrowing crept above five times the (six year) average EBITDA. And back in 2006 it was required for borrowing over 4 per cent of income.

    The levels may have shifted over the years but the principles remained the same – to ensure that providers in receipt of public funds offered value for money, and were fully responsible for the use of these funds. These broader requirements were set out in detail:

    HEIs must apply the following principles when entering into any financial commitments:

    a. The risks and affordability of any new on- and off-balance sheet financial commitments must be properly considered.

    b. Financial commitments must be consistent with the HEI’s strategic plan, financial strategy and treasury management policy.

    c. The source of any repayment of a financial commitment must be clearly identified and agreed by the governing body at the point of entering that commitment.

    d. Planned financial commitments must represent value for money.

    e. The risk of triggering immediate default through failure to meet a condition of a financial commitment should be monitored and actively managed

    At some point during the transition from HEFCE to OfS, all this was scrapped.

    The missing consultation

    If “at some point” sounds uncharacteristically vague that’s because the decision was murky even by higher education policy standards. The requirement was in the 2017 memorandum – it wasn’t in the OfS 2018 “terms and conditions” of funding, or any of the registration or information requirements, or the regulatory framework. The shift was never consulted on, it wasn’t in the Green or White paper, it was never discussed in parliament. It just kind of happened.

    In Wales, there are still requirements to get borrowing above a threshold signed off based on the 2017 Financial Management Code – however your (individual provider) threshold is built into the formulae of your financial forecast template. Thresholds are never published, but Medr may occasionally drop you a note to tell you what yours is. Which is nice.

    In Scotland things are (slightly) more straightforward: there is a threshold over which SFC’s formal consent is required. It’s not a concrete figure but a calculation to determine whether the total annualised cost of the borrowing exceeds 4 per cent of total income (according to a university’s last audited statements) or would exceed by 4 percent the estimated total income for the year in which the borrowing begins – whichever one is the lower.

    As things currently stand in England the explanatory sections on the D conditions of registration set up definitions of financial viability and sustainability. Viability is the interesting one here – for OfS purposes it means there is no reason to suppose the provider is at a “material risk of insolvency” (being unable to pay debts as they fall due) for the next three years. This clarifies that OfS does expect to know about borrowing (“have regard to” in fact) – and even suggests OfS would expect to be able to speak directly to lenders:

    It will be for the provider to ensure that the OfS is fully informed as to its financial facilities, and it will be expected to consent to the OfS making direct enquiry of the finance provider if requested to do so. The OfS may draw inferences from a failure to provide such consent.

    This approach to university borrowing can also be seen in the transition provisions that existed as OfS effectively carried on as HEFCE while it began to register existing providers – a commentary to the required audited data included the need for universities to include information on:

    Whether the provider is planning to take any loans from a bank, shareholders, directors or anyone else and, if so, information about these plans (how much is it planning to borrow, when will this be taken out, when will it be paid back, what will it be used for) and whether it will affect the provider’s viability or sustainability.

    A very good year

    This shift did not go unnoticed by universities, so 2017-2018 became a bumper year for university borrowing – with banks, private funds, and the bond markets all displaying an appetite for access to (then) underleveraged, secure, and low risk UK higher education.

    The 2017 HEFCE financial health publication noted that:

    At the end of July 2017, the sector reported borrowing of £9.9 billion (equivalent to 33.1 per cent of income). This is £980 million higher than the level reported at the end of 2015-16, which was £8.9 billion (30.7 per cent of income).

    By 2018 OfS as reporting that borrowing would reach £12bn by “year 2” (2017-18).

    At the end of Year 2, the sector reported aggregate borrowing of £12.0 billion (equivalent to 36.8 per cent of income), a 21 per cent rise of £2.1 billion compared to Year 1. Forecasts show that borrowing is projected to continue to rise in absolute terms over the four forecast years, reaching £13.3 billion by the end of Year 6.

    In the last quote, “year 6” is 2021-22 – the projection of aggregate borrowing was (as usual) on the low side. That year’s financial health report pegged it as just over £14bn.

    OfS, of course, could have decided to apply specific conditions of registration if it was concerned about borrowing at a particular provider. It still gets information on what universities are borrowing, and on what they plan to borrow in future, via the annual financial return (and there have already been rumblings about an increase in the amount and frequency of provided data). It could have stepped in to moderate the boom in borrowing since it took regulatory control of the sector – it did not.

    The morning after

    But the time of plenty has clearly passed – affordable finance is simply harder to come by, and the terms of existing borrowing (set during a more confident era) have often been renegotiated. The 2024-25 aggregate external borrowing is projected to be £13.3bn, and this for a much larger sector. And even the sector’s own (generally optimistic) forecasts suggest that it will drop further in years to come.

    This is very much the hangover after the party. The easy money simply isn’t there for the sector to borrow – all that remains is the improvements it paid for (hopefully in useful, tangible, things like estates and infrastructure), the repayments, and the interest.

    You can see that in the data (Based on what I know about what has happened so far I don’t think this includes stuff like bonds, so the figures are illustrative rather than precise) – the big peak in unsecured loans was in 2017-18, the academic year that restrictions came off (the smaller peak in 2020-21 represents the government backed Covid loans).

    [Full screen]

    You can also see a peak in repayments in 2018-19: clearly many providers decided that with the brakes off, the easiest way to proceed was with short-term revolving credit. More worryingly for sector finances, interest repayments remain at 2018-19 levels even though borrowing has declined sharply – an impact of a rise in interest rates following a long period of near zero inflation.

    A legacy of loans

    In essence some of the blame for the current financial crisis faced by the sector can be attributed to this little-scrutinised decision to remove borrowing safeguards. Though estates (especially) benefited from this gold rush, the entry of UK universities into the world of private placements and bonds has left a legacy that will take decades (and hundreds of millions of pounds cut off the top of sector finances, and increasingly arduous restrictions on university activity within covenants) to reckon with.

    And these controls on university activity hit in numerous ways. As Philip Augar’s review noted, way back in 2019:

    Universities’ expansion has been partly funded through debt and financial arrangements known as ‘sale and leaseback’. The former includes bond issues and bank borrowing; the latter involves universities selling student accommodation for cash upfront, sometimes committing to provide specified numbers of rent-paying students to the new owner.

    A failure to meet challenging recruitment targets has a multiplier effect if you factor lender requirements into the equation.

    Was the removal of controls over borrowing the single most important regulatory act of the modern era? For those able to raise money in this way, it supported huge improvements in university estates and infrastructure. It provided the capacity that has underpinned recent growth – though not as much growth as we saw in the 90s and 00s, when a far greater proportion of capital came from the state.

    It’s at least arguable that for many larger and better known providers the amount of indirect control over their actions that has been ceded to investors via covenants linked to borrowing. has driven the dash for growth at all costs. If you’ve worked in a university during this period and feel like things have changed, this could be why.

    And it gets worse if you think about the aggregated risk across the whole sector – not least because the arms race of expansion forced the majority of the sector to seek private finance at roughly the same time. The numbers in the chart above are indicative – but even so show a sizable liability that could have a huge impact on the way providers behave. It’s the roots of the sector-wide dash for growth that the regulators have expressed concern about – but thus far the impression has been given that it is just empire building. It is survival.

    The next few years

    There is no easy fix. Though I think most of us believe that the government would step in in the event of provider failure – to protect the student interest certainly, and possibly to protect the local interest – what would happen to outstanding debts across multiple providers in these circumstances is less clear. It is entirely likely that a loan becoming due for full payment due to a breach in covenant conditions would itself be the cause of provider failure.

    In the bad old days, when the government was a significant source of both capital and recurrent funding for most universities in England, there was a thing called exchequer interest – a complicated and little-discussed aspect of public funding that means that assets purchased with public funds should revert at least in part back to the public. Exchequer interest as a consideration for capital investment has largely been replaced by lender interest – in the event of a provider collapsing large parts of abandoned campuses (which, of course, have been paid for by public funds in the sense that it is income from fees that has funded repayments) would revert to lenders.

    These buildings and this equipment would immediately lose a lot of value, which is one reason why lenders like to renegotiate rather than repossess. If you think about it, a large teaching block in the middle of a thriving campus is a clear asset – without the campus it is a liability that needs to be repurposed and maintained.

    So if you ever see the government stepping in to save an anchor institution, recall that private finance has an interest in seeing campuses continuing to throng with students. It’s a funny way to preserve the future of the sector, but we live in peculiar times.

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  • Living HAPPILY in a World Without Meaning (Albert Camus)

    Living HAPPILY in a World Without Meaning (Albert Camus)

    Albert Camus’s philosophy of Absurdism provides a unique approach to the meaning of life. He explores the tension between humanity’s deep desire for meaning and the universe’s lack of answers, coining this contradiction as “the absurd.” His philosophy rejects nihilism and encourages us to embrace life’s limitations, living fully in the present and finding purpose through personal choices rather than ultimate truths. 

    In The Myth of Sisyphus, Camus likens life to Sisyphus’s endless task of pushing a boulder up a hill, only for it to roll back down—a metaphor for the repetitive, sometimes purposeless cycle of human existence. Instead of succumbing to despair, Camus suggests that we imagine Sisyphus finding joy in the struggle itself, symbolizing a resilient, defiant spirit.

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  • No more civic washing – most universities now pay their staff a living wage

    No more civic washing – most universities now pay their staff a living wage

    Today 88 per cent of UK universities pay a living wage, marking a significant increase from 2022 when I first published an article on Wonkhe that suggested that several universities were engaged in “civic washing” – claiming civic credentials without the concrete action to back up their claims.

    My argument then was that a significant proportion of universities had made public commitments to be “civic” but were not paying the living wage. How, I often asked myself, can you claim to be civic and not treat your lowest paid, and often local, staff with the dignity of a living wage?

    The Living Wage Foundation calculates the living wage to be £12.60 (£13.85 in London) according to the cost of living, based on a basket of household goods and services. This is above the statutory minimum wage, which the government brands as the “national living wage.” Employers – including universities – have used the language of the “voluntary living wage” (VLW) where they claim to pay the level determined by the Living Wage Foundation but are not accredited in doing so. This contrasts with the “real living wage” (RLW) which is when an employer is accredited by the Living Wage Foundation as paying the living wage.

    To be accredited with the Living Wage Foundation an employer must pay all directly employed staff the living wage and have an agreed plan in place for third party contracted staff such as for outsourced catering, cleaning and security. The requirement placed on subcontracted staff is one of the reasons that universities and other employers pay the VLW as opposed to the RLW.

    Real progress

    As reported in a series of Wonkhe articles (here and here), over the past four years there has been an increase in the number of universities paying the real and voluntary living wage. In the context of the acute financial crisis impacting many universities this is a massive achievement that should be celebrated. Indeed, I am aware of only one university that has de-credited from the Living Wage Foundation over the past few years.

    In 2019 (when I first looked into the living wage issue) only 38 of Universities UK members were accredited with the LWF. Today that has increased to 80 with four accrediting in 2024. However, this does not take into account the universities that pay the VLW. The only way to determine this is to check institutional websites and where no information is available to follow up with a freedom of information request. In 2024, we contacted 61 universities and determined that 39 were paying a voluntary living wage.

    This year I decided to update this analysis by focusing on the 22 universities that confirmed they did not pay the RLW or VLW. Two of these were private providers that did not respond to a FOI last year, so I excluded them. The remaining 20 did respond, of which 12 unambiguously acknowledged that they did not pay the living wage, three said they were considering it but currently do not pay the VLW, 2 said no, but added that their pay scales are above the living wage and thus were included in the analysis and three said that they now pay the VLW.

    This means that out of 140 universities in my sample, 123 now pay the real or voluntary living wage (88 per cent), up from 82 per cent last year. Whilst this is undoubtedly cause for celebration, it is important to note that the VLW does not require a commitment for subcontractors to be paid a living wage.

    As some of you know, I am off to pastures new and thus this will be the last time I update the analysis. However, I am delighted that Citizens UK’s community of practice on higher education has agreed to take on the exercise and I have shared with them all the data from previous years. Perhaps when I return to the UK the university sector will have set a precedent by being wholly accredited with the Living Wage Foundation.

    Find out more about the Living Wage Foundation and the process of accreditation as a Living Wage employer here. 

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  • Living Our Values: Courage, Care and Calling at CUPA-HR’s Spring Conference – CUPA-HR

    Living Our Values: Courage, Care and Calling at CUPA-HR’s Spring Conference – CUPA-HR

    by Julie Burrell | May 2, 2024

    “Wherever we go, we are CUPA-HR.” That’s what CUPA-HR President Andy Brantley reminded members at the recent Spring Conference in Minneapolis. Though institutions differ in mission and scope and despite daily crises that threaten to divert attention from long-term goals, CUPA-HR members live their values every day.

    The keynote speakers struck a similar theme, encouraging attendees to align their internal values with work, tapping into courage, care and a sense of calling.

    The Courage to Embrace Failure

    In her opening keynote, Kris McGuigan, an author, executive coach and corporate trainer, emphasized the power of authenticity in helping to overcome fear. At some point in our lives, we have all allowed our fears — including of failure, inadequacy and uncertainty — to dictate our future. “How often do we identify that a path is not serving us, but we stay the course, we cling to the status quo?” But clinging to the status quo out of fear can lead to apathy and disengagement. This lack of motivation and confidence can be tied to the engagement crisis at work.

    Facing Down Fear of Failure

    McGuigan believes courageously embracing failure can help move employees past apathy and disengagement. One way to start embracing failure is by taking a cue from tech. In their relentless testing and pushing out new releases, tech adopts a model of “perpetual beta.” This allows for constant innovation, with failure built into the model. If something doesn’t work, it’s scrapped and fixed — think of your smart phone’s frequent software updates. McGuigan asked, how can higher ed leaders bring this model of embracing failure to their teams?

    Takeaway: Having the courage to embrace failure can increase engagement and satisfaction and decrease apathy and disengagement.

    Creating a Caring Campus

    In his keynote, Dr. Kevin R. McClure, Murphy distinguished scholar of education and associate professor of higher education at the University of North Carolina Wilmington, drew from his forthcoming book, The Caring University, for which he interviewed staff, faculty and administrators. What he found will likely sound familiar. Higher ed employees were working tirelessly and generously, and frequently sacrificed their physical and mental health for their jobs. Consistent with CUPA-HR’s findings, McClure cited higher ed employees’ primary concerns as overwork, inadequate compensation, lack of recognition for their contributions, and lack of career pathways, among others.

    The Work “Just Kept Coming”

    McClure interviewed one higher ed staff member who said the work “just kept coming.” Her campus leaders talked about care, but there was no structural change to her workload, so she started looking for a new job. Many of his interviewees felt they were required to be superhuman — a worker without a body or personal life — who “exists only for the job.”

    Structural changes are needed in policies and procedures, he emphasized. What happens when practices like service awards and merit pay reward only ideal workers and not real people, or when leave policies don’t account for people’s caregiving or health needs? Employees will disengage and look for jobs elsewhere. HR has a crucial role to play in transforming the workforce, he says, and institutions need to empower HR as experts.

    Takeaway: Structural change is urgently needed to transform higher education into a workplace that values the well-being of its employees.

    Living your Calling Through Job Crafting

    In the closing keynote, Dr. Amy Wrzesniewski shared insights into what makes work meaningful for the individual. In her research, Wrzesniewski, who is William and Jacalyn Egan professor at the Wharton School of the University of Pennsylvania, identifies three main ways people understand their work: as a job, career or calling.

    Out of these, it is people who see their work as a calling who are more satisfied with the work and with their lives, tending to be absent less and engaged more. So how do people come to treat their work as a calling? That’s where “job crafting” comes in.

    Finding Purpose in Work

    Wrzesniewski interviewed members of a cleaning crew in a university hospital. This work is often stigmatized as non-meaningful, but employees who found a calling in the work were engaged in job crafting, often doing a different job than their job description, while still completing their required duties. For example, one cleaning crew member said that she tailored the cleaning schedule around patients who might be sensitive to the smell of cleaning chemicals. She made a tangible difference in the lives of others, even though she risked getting written up for doing so.

    Wrzesniewski argues job crafting has several benefits. It can increase satisfaction and commitment to the job, intensify happiness at work, boost job mobility, and even maintain or increase performance.

    Takeaway: Job crafting — the practice of living out your values by making work your own — can help make a work a calling, not just a job.



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