Politics
Tuition fees: Increase in cap on university costs expected, Sky News understands
An increase in university tuition fees in England is expected to be announced for the first time in more than seven years, Sky News understands.
Fees have been frozen at an annual level of £9,250 since the 2017/18 academic year, but the government is expected to lift the cap so they can rise in line with inflation.
That will increase the cost of tuition to £9,500 in October 2025 and £10,500 by 2029.
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It’s expected that Education Secretary Bridget Phillipson will confirm the move in a House of Commons statement later today.
Any such announcement is likely to provoke a strong backlash, given Sir Keir Starmer had pledged to abolish tuition fees when he stood to be Labour leader in 2020.
The prime minister rowed back on that promise early last year, saying it was no longer affordable because of the “different financial situation” the country was in, and he was choosing to prioritise the NHS.
However at the time he said Labour would set out a “fairer solution” for students if it won the election.
Bridget Phillipson. Pic: Reuters
The change comes as universities have been dealing with a funding crisis, largely driven by a huge drop in overseas students.
Rules brought in by Rishi Sunak’s government made it harder for international students, who pay higher fees than British ones, to bring their families with them to the UK.
Universities have been pleading for more investment, but Ms Phillipson said recently that institutes should seek to manage their own budgets before hoping for a bailout from the taxpayer.
When she was in opposition, she also touted the idea of reducing the monthly repayments “for every single graduate” by changing how the loan is paid back.
Writing in The Times in June 2023 she had said: “Reworking the present system gives scope for a month-on-month tax cut for graduates, putting money back in people’s pockets when they most need it.”
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However the idea didn’t make it into Labour’s 2024 manifesto, which only says that “the current higher education funding settlement does not work for the taxpayer, universities, staff, or students”.
It adds: “Labour will act to create a secure future for higher education and the opportunities it creates across the UK.”
Independent MP Zara Sultana, who lost the Labour whip after rebelling over the two-child benefit cap, called the latest development “wrong”.
“It’s time to abolish tuition fees and cancel student debt because education is a public good, not a commodity,” she posted on X.
‘Maintenance loans bigger issue’
However, money saving expert Martin Lewis said higher fees won’t necessarily lead to students facing higher yearly repayments, as that “solely depends on what you earn not on what you borrow”.
In a thread on X he said a more damaging policy was the Tories’ decision last year to drop the salary threshold at which repayments must be made – from £27,000 to £25,000 – and increase the time to clear the loan before it is written off, from 30 to 40 years.
He said: “Increasing tuition fees will only see those who clear the loan in full over the 40yrs pay more. That is generally mid-high to higher earning university leavers only, so the cost of increasing them will generally be born by the more affluent.”
He added that a bigger problem for students is the fact maintenance loans “aren’t big enough” and “have not kept pace with inflation”.
University fees of £1,000 per year were first introduced by the Labour government in 1998, going up to £3,000 in 2006.
The Coalition government then tripled the amount to £9,000 in 2012, sparking a huge backlash, particularly against the Lib Dems who had vowed to scrap fees in the 2010 general election campaign.
Since then there have been further changes to student finance such as the abolition of maintenance grants and NHS bursaries, moving student support increasingly away from non-repayable grants and towards loans.