In response to research published today by London Economics
for the University and College Union, Universities UK welcomes
the new independent analysis into the potential economic and
societal impact of the challenges posed by the Covid-19 pandemic
in higher education.
The report highlights the huge scale of the potential
impact on students, universities, the jobs market, local
communities and the wider economy if urgent action is not taken
by government.
Universities UK has recently published a balanced package
of proposals to
government to mitigate these challenges and ensure the sector is
able to play a key role in the UK’s recovery and awaits a
response from government to this.
The Chief Executive of Universities UK, Alistair
Jarvis, said:
“Universities have a vital role to play in the recovery of
economies and communities. This helpful report highlights the
critical financial risks for the sector which not only threaten
this role but put some universities at risk of financial
failure.
“The union is absolutely right to warn of the knock-on
impacts this would have for jobs, regional economics, local
communities and students.
“Government must take urgent action to provide the support
which can ensure universities are able to weather these very
serious challenges, and to protect students, maintain research,
and retain our capacity to drive the recovery of the economy and
communities.”
Universities UK’s own analysis shows that some institutions
will be particularly impacted by any combined reduction in
international student numbers and increased deferrals. Those are
likely to have higher levels of external borrowing and lower
levels of cash reserves. This limits the ability of the
most vulnerable institutions in this scenario to increase their
borrowing to mitigate the consequences of reduced student
numbers.
Meanwhile institutions facing the greatest financial
pressure in general have higher proportions of BAME students.
This would mean that this group could be disproportionately
affected if their institutions face financial difficulty and
their institutions’ ability to provide a high-quality student
experience is affected.
