Question to the Department for Education:

To ask His Majesty's Government what assessment they have made of the number of English universities facing financial difficulties; and what assessment they have made of the impact closure could have on local communities.

The Office for Students (OfS) is the independent regulator of higher education (HE) in England. The OfS monitors the financial viability and sustainability of providers registered with them to ensure they have an up to date understanding of the sustainability of the sector.

The OfS latest published report can be accessed here: https://www.officeforstudents.org.uk/media/445d176e-e61c-4e95-a76a-7acb7e5bb654/financial-sustainability-2022_corrected-sept-2022.pdf. It stated that despite the many operational and financial challenges arising from the COVID-19 pandemic, the overall aggregate financial position of universities, colleges and other registered HE providers remains sound. However, there continues to be variation in the financial performance and strength of individual HE providers. The department recognises that the situation remains challenging, and that providers will need to adapt to uncertainties and financial risks to protect their longer-term sustainability.

Officials meet regularly with the OfS to oversee the overall climate for HE provider financial sustainability and to identify emerging key risks and issues for the English HE sector as a whole.

The financial sustainability of the HE sector is essential to the future success of the economy and society, including local communities. Universities are autonomous and independent, meaning they are responsible for the decisions that they make in regard to their operating model, day-to-day management and sustainability.

The department supplies annual funding via the Strategic Priorities Grant (SPG) to support teaching and students in HE, including expensive to deliver subjects, such as science and engineering, students at risk of discontinuing their studies, and world-leading specialist providers.

The recurrent SPGS budget is £1,397 million for financial year 2022/23, which is 5% higher than last year. This includes an additional £56 million in recurrent SPG, an additional £10 million to support the expansion of medical student places agreed by government in 2016/17, and an additional £1 million in HE Innovation funding. We are investing an additional £750 million over the next three years to support high quality teaching and facilities including in science and engineering, subjects that support the NHS, and degree apprenticeships.

As part of the £750 million, we have provided the OfS with £450 milloon of capital funding for financial years 2022/23 to 2024/25. Almost £400 million of this funding has been made available through a bidding exercise to target funds at key strategic priorities, including high-cost subjects and level 4, 5 and degree apprenticeships.

One hundred providers were successful in securing funding for capital projects that will directly help us achieve our skills reform ambitions to strengthen HE and better align skills training to the needs of employers to enable communities to thrive.

If a provider was at risk of an unplanned closure, the department’s priority would be to work with the OfS, the institution and other government departments to ensure students' best interests are protected.