University bosses call for further tuition fee hikes, as funding crisis to hit three-quarters of universities

University vice-chancellors have pressed for further annual tuition fee increases in line with inflation after the Office for Students (OfS) warned that 75% of institutions would be running deficits by 2026.

Earlier this month, the government announced a one-off increase in fees of 3.1% for 2025, but university leaders have argued that this rise will be insufficient.

Marking the first tuition fee increase since 2017, vice-chancellors across England claim universities are still struggling to cover rising costs, risking the quality of education and services offered to students.

A report by the OfS suggested that nearly three-quarters of higher education providers are expected to run deficits by 2026

Modelling by Data HE suggests that fees would need to rise to £10,900 by 2029 to match inflation. The government has not confirmed whether it will raise tuition fees further after the next academic year, though Education Secretary Bridget Phillipson confirmed that “major reform” to university investment will be outlined in the coming months.

Concern among university bosses comes after a report by the OfS suggested that nearly three-quarters of higher education providers are expected to run deficits by 2026.

The sector faces a total shortfall of £1.6 billion, with some universities relying on financial reserves or overdrafts to cover basic operations.

Smaller institutions and those with fewer international students are particularly at risk as inflation and the rising cost of debt chip away at their margins.

Taking the cap off fees and letting them grow by inflation every year has to be the minimum starting point

Professor Sir Steve West, Vice-Chancellor, University of the West of England

Professor Sir Steve West, Vice-Chancellor of the University of the West of England, has said that universities expect further increases, warning that: “Taking the cap off fees and letting them grow by inflation every year has to be the minimum starting point.”

Despite these warnings, the prospect of raising fees further has sparked debate. Critics argue that fee increases will disproportionately impact students, many of whom already face substantial debt.

The Education Secretary has also insisted that “universities must do more to make their finances work”, calling on institutions to focus on cost-cutting measures and budget efficiency.

For many vice-chancellors, however, fee hikes are essential to preserving educational quality. Cuts to staff, courses, and support services have already begun at some universities, such as the University of East Anglia where class sizes have increased, and some courses have been axed.

As the government prepares to review university funding in 2026, the clash between affordability and sustainability looms large. For now, vice-chancellors remain firm: without inflation-linked tuition fee increases, the future of higher education in England hangs in the balance.