At least three English universities on the 'verge of bankruptcy'

David HardingContributor
Yahoo News UK
Universities could go to the wall, it has been warned (PA)
Universities could go to the wall, it has been warned (PA)

Three English universities are on the verge of bankruptcy, research has found.

Other educational institutions are also struggling, surviving only by resorting to short-term loans, the i has claimed.

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The body representing teachers and lecturers, the University and College Union, said any university going bust, would have ‘a devastating impact on staff, students and the local area’.

The three worst affected universities are facing financial disaster because of increased competition for students, falling numbers of 18-year-olds applying to go to university, and a drop in international student numbers because of tougher immigration controls.

One of the three is thought to be located in the North West, and the other two on the south coast.

One institution is already thought to be in insolvency talks.

Student numbers have been falling (PA)
Student numbers have been falling (PA)

“A university going bust is more likely than at any other point in the last generation,” Nick Hillman, director of the Higher Education Policy Institute think tank said.

“What is of concern is those universities that are resorting to taking bridging loans to tide them over until their student fees come in. They are borrowing just to survive.”

Funding changes have deeply affected educational institutions.

The trebling of tuition fees and a removal of a cap on the number of students has led to increased competitions for a smaller number of students.

Experts claim that the changes are making some universities less attractive for students.

“(There are universities) that are not attractive for students to study, or they are smaller universities that are close to more popular institutions,” said Matt Robb, an education consultant.


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He said three or four universities could soon go bust.

“Some of them may never have been financially viable in the first place, in which case if they are about to go bust, then if there is no compelling public interest, let them go bust,” he added.

Because of financial difficulties some of the universities may look to sell off land, it was claimed.

Matt Waddup head of policy and campaigns at the UCU said: ‘If we are serious about our higher education sector continuing to compete on the global stage then we need to ensure all parts of it are properly supported, not anticipating its premature demise.’

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