The government recognises that the COVID-19 outbreak is bringing significant financial challenges to the higher education (HE) sector and we have been working closely with the sector to monitor the likely impacts.
On 4 May 2020, my right hon. Friend, the Secretary of State for Education, announced a package of measures to ensure sustainability in HE at a time of unprecedented uncertainty.
We have stabilised the admissions system and will pull forward tuition fee payments, expected to be worth £2.6 billion, for providers so that they receive more money in the first term of the 2020/21 academic year. This will have no impact on students but will allow providers to better manage financial risks over the autumn. This will be available to all providers across the UK. In reprofiling these payments, we are clear in our expectation that providers should use the cashflow benefits appropriately, taking significant steps to improve efficiencies and manage their finances in order to avoid cashflow problems in the future. Reprofiling in this way is a one-off intervention for the autumn term only, to help providers take all necessary steps now to prepare for the future.
On 27 June, the government announced a further package of support to research-active universities to enable them to continue their research and innovation activities. This includes £280 million of government funding, and a package of low-interest loans with long pay-back periods, supplemented by a small amount of government grants, which will be available from autumn. In sharing responsibility for the future of science and research with our world-leading university system, the government will cover up to 80% of a university’s income losses from international students for the academic year 2020/21, up to the value of their non-publicly funded research activity.
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 £700 million to the sector.
The department is working closely with HM Treasury and other government departments to develop a restructuring regime for HE providers in England. We will only intervene where we find there is a case to do so and only where we believe intervention is possible and appropriate, and as a last resort. A restructuring regime will review providers’ circumstances and assess the need for restructuring, financial support and any attached conditions. We are discussing our approach with the devolved administrations.