The UK has international students to thank for its high REF scores

The extent of research‘s cross-subsidisation by overseas student fees is too rarely understood by policymakers and academics alike, says Ruth Arnold

May 15, 2022
Financial charts projecting upward and a small mortarboard, signifying international students
Source: iStock

Research carried out in UK universities is often required to explicitly acknowledge the sources of its funding. The names are familiar: research councils, charitable organisations and medical foundations. But one category of donors is missing from the lists found on papers, websites and buildings and in the titles of endowed chairs.

In 2020, the Higher Education Policy Institute (Hepi) published a report on cross-subsidisation from teaching to research. Director Nick Hillman, always forthright about the realities of higher education finances, explained that UK university research is underfunded against its true costs in a way that few even within the sector fully understand. The shortfall totalled £4.3 billion across the UK and £3.7 billion in England and Northern Ireland, a quarter of the total cost. 

So how had universities filled that gap? The answer was international students’ fees. Once teaching costs are accounted for, these provide a surplus of more than £5,000 each, which is redeployed not just in building or refurbishing facilities but to also in meeting the direct costs of the research that builds the research excellence and reputations responsible for attracting so many students to the UK in the first place. Currently, for example, only around 50 per cent of the cost of training a domestic PhD in the UK is recovered from funders, and only 72 per cent of the full economic costs of research.

Why does this matter? Shouldn’t we just be grateful and move on?

Well, we should at least check our assumptions. First, the funding gap isn’t static: it’s widening. Since the Hepi report was published, university finances have come under even more pressure. The ongoing freeze in domestic tuition fees amounts to another real-terms cut, making them worth a third less than they were when they were introduced in 2012: a figure that typically fails now to cover costs. And now we have the devastating impact of inflation, especially in energy prices; the cost of sustaining the conditions of heat or cold necessary to so much scientific research is getting ever higher. We should be aware that other sources of public support may ultimately be required if we want to maintain research output and quality.

Second, supply depends on availability. International fees and the international pipeline of talented graduates who staff UK labs and research groups cannot be taken for granted. The ongoing impact of the pandemic on China and constraints on Chinese students’ travel remind us that transnational flows of people can be interrupted.

The UK is doing well in meeting its international student number targets, and its International Education Strategy aims to sustain that momentum. A cross-departmental government initiative involving not only the Department for Education but also the Department for International Trade and the Home Office, its key intervention so far has been to reintroduce post-study work. The government has also shown flexibility around international students throughout Covid, and that was really important.

However, the UK picked up its pace in international recruitment at a time when Australia and New Zealand had closed borders and the US was recovering from political travel bans introduced by the Trump administration. It would be foolish to assume competition for precious international students won’t become fiercer as policymakers and institutions across the world feel pressure on their own higher education budgets. 

Joined-up thinking in government must continue – particularly if the flagship Levelling Up and Regeneration Bill, announced in this week’s Queen’s Speech, is to fully engage universities as anchor institutions – as it must do if it is to be successful. In that regard, the splitting of teaching (Department for Education) from research (Department for Business, Energy and Industrial Strategy) doesn’t help.

UK policymaking needs to build in the aspiration and voice of international students themselves, on everything from visa costs and work placements to increased cultural awareness within mental health services and genuinely global careers support. Embedding the international student charter, being developed with students by the UK Council for International Student Affairs, would build engagement and responsiveness into the sector for the long term. 

Those universities celebrating their success in this week’s Research Excellence Framework owe a deep debt of thanks to the families in Beijing and Bangalore, Kigali and Kuala Lumpur who are willing to invest so heavily in the education of their children. But we need to ensure that that investment in UK universities continues to offer them the maximum possible value for their money.

Our silence on our debt to international students should be broken. And our policymaking must become more responsive to what they rightly expect in return. 

Ruth Arnold is senior adviser (global external relations) for Study Group and a co-founder of the #WeAreInternational campaign.

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