Committee publication · Correspondence · 25 June 2026
Letter from the Chair of the Education Committee on the recent Report on Higher Education and Funding: Threat of Insolvency and International Students
From: Welsh Affairs Committee
Summary
Helen Hayes MP, Chair of the Education Committee, writes to the chairs of the Scottish, Welsh, and Northern Ireland Affairs Committees drawing attention to the Education Committee's recent report on Higher Education and Funding. She identifies six areas where UK Government reserved powers affect higher education across all four nations: competition law, VAT on shared services, international student immigration rules, Erasmus+ association, research funding levels, and student protection in institutional insolvency.
Key findings
- Competition law and CMA regulation may be deterring necessary collaboration and mergers between higher education providers across the UK; the Committee recommends continued monitoring and a UK Government consultation on whether changes are needed.
- VAT on shared services is a significant barrier to service sharing between higher education providers across all UK nations; the Committee recommends the Department for Education work with Treasury to gather data on removing this VAT.
- Graduate visa changes reducing duration to 18 months, plus reforms to Basic Compliance Assessment requirements, will affect international student recruitment across Scotland, Wales, Northern Ireland, and England; the Government should review impact twelve months after implementation.
- Research funding from UK Research and Innovation is not meeting the Government's committed 80% of full economic cost threshold; the Committee calls for reconfirmation of this commitment and a review of long-term research funding sustainability.
- Student protection mechanisms in the event of higher education provider insolvency require improvement; disorderly institutional exits carry reputational risks for the entire UK higher education sector.
Tone
ProceduralTopics
Key actors
Helen Hayes MP, Patricia Ferguson MP, Ruth Jones MP, Tonia Antoniazzi MP, Competition and Markets Authority, Department for Education, UK Research and Innovation
Notable line
“… a disorderly exit of a higher education provider could have a reputational impact around the world that would affect all of the UK higher education sector.”
Key Quotes
“Competition law and regulation by the Competition and Markets Authority (CMA) applies across the UK.”
“VAT on shared services can be a significant barrier to the sharing of services between higher education providers. Such VAT applies across the United Kingdom.”
“Research funding is not meeting 80% of full economic costs …”
“… a disorderly exit of a higher education provider could have a reputational impact around the world that would affect all of the UK higher education sector.”
Source · parliament.uk record ↗