Two in five universities considering mergers as majority cut jobs

Two in five UK universities are open to or are actively considering acquisitions and mergers with other institutions, according to research.

A Universities UK (UUK) survey of its members found that financial pressures are leading to significant cuts across the sector, with 79 per cent of institutions pursuing voluntary redundancies.

Similarly, of the 48 universities that responded to the survey, 79 per cent have implemented hiring freezes or paused staff recruitment in the past three years.

Changes to courses are also “widespread”, UUK said, with just under half of universities reporting having reduced their course offering through consolidation (46 per cent) or course closures (44 per cent) over the past three years.

Institutions are also considering larger-scale structural changes in response to the financial crisis gripping the sector, with about 40 per cent saying they were open to or actively considering acquisitions or mergers with other universities in the future.

Cranfield University recently announced plans to become part of King’s College London by August 2027, while a merger between the universities of Kent and Greenwich is already under way, which will see the institutions become part of one multi-university group.

Collaborative structures, such as federations and alliances, are also popular, with 65 per cent of universities considering these, according to the survey.

However, UUK flagged that “significant barriers” to structural transformation remain, including VAT rules that can see universities charged more for sharing services.

Vivienne Stern, chief executive of UUK, said there are “clearly barriers to what universities can do on their own”, with tuition fee uplifts failing to offset cost pressures.

Respondents cited rises in national insurance contributions, changes to international student recruitment and pay and non-pay cost inflation as adding to their financial problems.

“We are extremely grateful to the government for the tough decision to uplift fees in line with inflation in England and Wales, but as the survey results show, it just doesn’t go far enough,” said Stern.

“Course closures, staff redundancies and reduced research, which ultimately hit students, local economies and national prospects for growth, cannot continue to be the only solution to the sector’s financial challenges.”

Universities continue to call for the creation of a transformation fund through which the government would provide money to support structural change.

“If the government is serious about driving growth and ensuring that the opportunities that universities create for people all over the UK remain in place, we need smart investment into higher education,” Stern said.

helen.packer@timeshighereducation.com