Two in five universities consider joining forces through
‘multi academy trust' style models or mergers, new survey
shows
A new survey of more than 140 universities reveals the steps they
are taking to respond to funding pressures and ensure they
continue to deliver world-class education now and into the
future.
The survey, conducted between March and April 2026 by
Universities UK (UUK), asked respondents where they have already
made cuts due to financial necessity, and where they would
consider future cuts if required.
Universities are stepping up their efforts to work creatively and
collaboratively to unlock efficiency. Of those responding to the
survey, the third annual iteration of such research:
- 81% are considering digital transformation
- 71% are open to shared procurement options
- 65% are considering collaborative structures such as
federations and alliances
Currently, only a small minority have already pursued large-scale
structural change such as mergers or acquisitions with
another university, but the survey shows that two in five
institutions are open to or actively considering mergers or
acquisitions with other universities in the future.
However, the survey found significant barriers limiting the
progress universities can make on their own. Universities are
calling for greater flexibility over VAT and government support
for the upfront costs of radical collaboration through a
Transformation Fund to ensure they can make real progress on the
transformational projects that will allow them to take control of
their financial situation.
In the survey, a lack of institutional knowledge and
skills were also cited as major barriers to transformation.
Through its transformation and efficiency programme, UUK is
sharing experience and best practice and facilitating access to
specialist legal and financial expertise to support institutional
transformation programmes.
The survey highlighted other key areas of cost cutting by
universities and further measures they are considering.
- Staffing has become one of the most common areas of cost
saving with 79% of universities pursuing voluntary
redundancies and 79% implemented hiring freezes or
pauses to recruitment over the last three years.
- Student-facing funding cuts increased from last
year's survey, with 27% cutting student bursaries and
scholarships (compared with 15% in 2025) and 13% cutting hardship
funding, (9% in 2025) .
- Almost a third of institutions (31%) reported making cuts to
academic research activity in the last three years, up from 14%
in 2024.
The findings show changes to courses also remain
widespread. Just under half of universities reported having
reduced their course offering through consolidation (46%) or
course closures (44%) over the last three years.
Operational cutbacks also remain common across the
sector, with over half (54%) cutting back on repairs
and maintenance. 13% have closed campuses in the past
three years and 29% would consider doing so in the future.
While recent uplifts to the domestic undergraduate tuition fee
cap were cited as having a positive impact on
finances, most English and Welsh institutions (92%) said
the fee uplift would not fully offset the financial
impact of planned policy changes.
Almost all respondents report being impacted by government policy
changes, cost inflation and
wider financial pressures. The most cited negative
impacts on institutional finances were increases to employer
national insurance contributions (79% of institutions),
changes to international student recruitment (67%) and pay and
non-pay cost inflation (65%).
Vivienne Stern MBE, Chief Executive of Universities
UK:
“Universities are grasping the nettle to respond to the severe
financial pressures they are facing. Many have had to make
significant cuts, but the survey also shows how the sector is
finding creative, collaborative solutions to become more
efficient and ensure it can continue to deliver the world-class
education the UK is known for.
“However, there are clearly barriers to what universities can do
on their own. 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. 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.
“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.”
ENDS
Notes to Editors:
- A survey of UUK member Finance Directors was conducted
between March - April 2026, asking respondents where they have
made cutbacks due to financial necessity and where they would
consider future cuts if required. Responses were received
from institutions across the UK, with a wide variety of
institution types represented.
- 48 members responded to the survey in total. This corresponds
to 34% of UUK's membership. This was the third
consecutive year running the survey. The survey repeated several
questions from the 2025 and 2024 editions to allow
comparability.