Financial pressures and financial sustainability

These pages summarise the latest data on the financial health and sustainability of providers, what we expect providers to do and our approach to regulation in this area. 

Latest analysis

Student recruitment for 2024-25

• UK student entrants increased by 3.5 per cent, which was 8.6 per cent below the sector’s previous forecast.
• International student recruitment decreased by 7.7 per cent, which was 9.0 per cent below forecast.
• Excluding specialist creative institutions, UK student recruitment at each type of provider was below what institutions had predicted.
• All provider types, apart from Level 4 and 5, saw a reduction in the number of international students they recruited compared to forecast. Larger research-intensive and specialist providers (non-creative) saw the largest decreases in international students compared to forecast numbers.

Financial impact

• At a sector level, institutions reported an improvement in financial performance in 2024-25, with adjusted surplus, operating cash flow and net liquidity all increased compared with 2023-24.
• Financial performance varied significantly between institutions. Without taking mitigating action, 119 institutions (42.7 per cent) could report deficits in 2025-26.
• Total sector income increased by 2.7 per cent since 2023-24. Nearly half of this was attributable to higher tuition fees and income from education contracts.

Financial transformation

• Nearly 25 per cent of institutions reported that they incurred costs from restructuring activities, such as voluntary redundancy schemes, in 2024-25.
• Sector-wide, these costs rose sharply by 20.7 per cent to £218.2m, with the most significant rise reported by larger research-intensive institutions. 

Current financial context

We know that the higher education sector in England is under significant financial pressure. Providers are operating in a challenging economic environment, and are facing risks to their financial viability and sustainability, including volatile student recruitment and increased operating costs.

We are closely monitoring the financial sustainability of providers to identify those that may be at higher levels of financial risk, and are working with them to understand and assess the extent of the issues and how these are being addressed.

We will continue our work with providers that are facing significant financial difficulties, ensuring they take steps to mitigate risks and to support students to continue their studies.