Universities eye levy U-turn under Burnham leadership

English universities are calling on Andy Burnham to reverse the incoming international student levy, in the hope that his past support for the sector will mean he offers it a more sympathetic ear.

The government plans to charge universities £925 per international student they enrol from August 2028 onwards, a move that is widely unpopular among institutions, which say it will add to their financial woes.

Vice-chancellors are quietly hopeful that lobbying a new prime minister, and a likely new ministerial team in the Department for Education, can secure more concessions, or even see the policy scrapped entirely. While the government has committed publicly to the levy, it has not been legislated for and its launch is still two years away.

Vivienne Stern, chief executive of Universities UK, confirmed a plan to renew efforts to fight the levy when outgoing prime minister Keir Starmer’s replacement takes office. 

“The international student fee levy puts us in the bizarre situation of the government effectively putting a tariff on a UK export,” she said. 

“We will be calling on the next prime minister to reverse the decision to introduce the levy because it will damage the economies of towns and cities across England, the interests of UK students and the vital research universities undertake.”

Burnham has expressed support for international students in the past, co-signing a letter from seven mayors published in the Financial Times in 2018 asking the government to rethink its policies towards overseas students. 

But with Burnham now needing to find an additional £7 billion to fund the government’s latest defence commitments, there are doubts about how willing new ministers will be to give up the income from the levy, which will be used to fund new maintenance grants for students from low-income households.

“Personally I think it is unlikely they will overturn it,” said David Pilsbury, chief development officer at Oxford International. “That smacks too much of the U-turns that Starmer and Reeves were accused of, and also the levy is a fantastic political instrument to demonstrate clearly to local communities that they get some benefit from international students – and all governments in the future are going to be pushing for more of that.”

However, he said the sector should lobby for more of the levy to be reinvested in higher education. Ministers have committed to spending some of the money on grants but have not announced where the rest will go.

“A little bit of money chipped off the levy would make a massive difference to the sector and what it can do in the future to deliver what we need as a country from higher education,” said Pilsbury.

International higher education consultant Vincenzo Raimo agreed: “There is a strong argument that if government is taxing one of the UK’s most successful export sectors, at least some of the proceeds should be transparently reinvested in strengthening that sector.”

He referenced the Export Education Levy in New Zealand, where all education providers are charged a percentage of their income from international student tuition fees. The money is used to fund aspects of the international education sector, including student support and protection.

The sector may also consider asking the new government to soften the levy. The Russell Group has previously called for PhD students to be exempt from the levy, arguing that including them will “harm ambitions for economic growth and the UK’s [research and development] capabilities”. 

The current design of the levy means universities with tighter margins and lower fees are likely to be hit the hardest, added Raimo. These institutions are often those that focus on widening participation and operate in areas of disadvantage – likely to be a cornerstone of Andy Burnham’s approach to governing. 

Raimo said: “If I had one message for the new government, it would be that the levy should be judged not simply by the revenue it raises but by whether it supports the government’s wider objectives for higher education, research, international education and the UK’s long-term economic competitiveness.”

helen.packer@timeshighereducation.com