UCL won’t pass levy costs on to international students

Speaking at The PIE Live Europe in London this week, Clare Foyle, director of strategic planning at UCL, told the audience that the levy would be “absorbed into our usual thinking about tuition fees” rather than passed on directly to international students.

“We’ve decided that [the levy] will not be passed on. It certainly won’t be on the invoice,” she said.

Foyle acknowledged that absorbing the costs – which is likely to hit UCL the hardest of any university, based on its 2023/24 enrolment data – would inevitably have a knock-on impact other things it would be able to invest in, such as classroom development or technical equipment.

“We’re absolutely going to try and protect the things that we think are really, really important for students, but it will slow down some of the new and innovative things that we were wanting to do,” she said.

“We wouldn’t see it as taking anything away, but it just slows down our process,” she added.

We’re absolutely going to try and protect the things that we think are really, really important for students, but it will slow down some of the new and innovative things that we were wanting to doClare Foyle, UCL

The panellists explored how other English institutions would decide to grapple with the levy during a session exploring the impact of the upcoming policy, which is expected to be implemented in 2028. Only English universities will be affected by the policy, with Welsh politicians unequivocally stating that they would not be imposing a levy on institutions in Wales.

“The financial pressures are really pushing the sector to be more reactive, rather than proactive,” pointed out Janet Ilieva, founder and director of Education Insight, highlighting that some universities were discontinuing less popular programs – such as languages or agriculture – that, ironically, often have some of the highest completion rates.

“This is where the sector holes up into a very reactive space, which erodes many margins,” she warned.

A straw poll of the audience suggested that most English universities are still weighing up their options when it comes to deciding whether or not to up tuition fees in response to the policy.

Session chair Vincenzo Raimo, an international higher education specialist, said this tallied with the conversations he had been having with universities – that most were exploring their options or else waiting to see how others would react to the policy before making a firm decision on their own strategy, although others said they would be passing the costs directly on to students.

“I think many universities will try and stick with increased volume rather than thinking about the quality and the price point,” suggested Jamie Warner, an independent higher education finance consultant.

The introduction of the levy has been a particularly controversial policy from the UK’s Labour government, with critics pointing out that the higher education sector – already strapped for cash – could see a mass exodus of enrolments from price-sensitive sending countries.

Ilieva said that the UK was already losing market share to emerging destinations due to the growing multi-polarity of the sector.

She pointed to research suggesting that some of the key sending countries to the UK – India, Pakistan, Nigeria, Nepal, Bangladesh and Sri Lanka – are particularly price sensitive. And with ongoing hostilities in demand influencing fuel prices and in turn inflation, she warned that the policy could not be coming at a worse time.

“This is the time when long-term sustainable engagement matters the most. So, I would urge policy makers [to] think again. This is a strategic mistake – poorly timed, badly executed,” Ilieva said.

Nic Dillon, director of the Nous Group, highlighted that the levy policy isn’t happening in a vacuum, with changes to Basic Compliance Assessment (BCA) metrics, changes to visa rules for dependants and conversations about international students seeking asylum all working together to create a perfect storm for UK international education.

But he said that despite the challenges to the sector, some institutions were already setting their international fees at the wrong level.

“Many, many universities are already pricing wrong by much more than the £925 of the levy,” he said. “So ultimately, we’re dealing with our own errors of this magnitude. This [the levy] is just the government adding another one.”

Meanwhile, partner at CIL Strategy Consultants Patric Kirchner echoed that many universities’ pricing was “still quite immature” and not necessarily value-based.

“It’s more like a process. So you have to run this process every year, you look at last year’s fees, then you maybe mark it up a bit here and there. But from my experience, what I’ve learned over the last month, it’s not very strategic,” he said.