Why are tuition fees in England going to rise?

The Education Secretary has announced the first rise in tuition fees in England for eight years.

It comes after warnings about university finances as a result of capped tuition fees paid by domestic students and a significant drop in the number of overseas students.

The PA news agency takes a look at what higher tuition fees mean for students and universities.

Universities in England can increase maximum tuition fees for full-time courses from  £9,250 per year to £9,535 from next year.

Maximum fees for standard full-time courses will rise by 3.1% to £9,535.

The Department for Education has said tuition fees will increase in line with RPIX inflation (3.1%) and it will come into effect in the 2025/26 academic year.

The new maximum tuition fee will apply to new students and those who are continuing their studies, the Government has said.

Longer-term funding plans for the sector will be set out in due course.

Maintenance loans – the loan that helps with living expenses as a full-time student – will also increase by 3.1% in line with inflation from next year.

It will provide up to £414 extra per year to help students from the lowest income families, the Government has said.

The loans, which are means-tested, will increase to £10,544 a year for someone living away from their parents who goes to university outside London, and to £13,762 a year for students living away from home and studying in the capital.

But plans to bring back maintenance grants in England to support the poorest students have not been announced, despite calls from sector leaders to do so.

Maintenance grants for disadvantaged students in England were replaced in 2016 by loans which have to be paid back.

The previous government raised the cap on university tuition fees in England to £9,000 per year in 2012, but it has been frozen at £9,250 for domestic students since 2017.

University leaders have repeatedly warned of financial concerns as a result of frozen tuition fees paid by domestic students and a fall in the number of overseas students.

Home Office figures released last month showed there was a 16% drop in visa applications from international students, who pay higher tuition fees than domestic students, between July and September.

In its assessment of university finances in May, the higher education regulator the Office for Students (OfS) said 40% of universities in England were predicted to be in deficit in 2023/24.

Education Secretary Bridget Phillipson told MPs on Monday that the tuition fee increase had “not been an easy decision” but it would help universities facing “severe financial challenges”.

She said the decision would help “secure the future of higher education”.

Universities UK (UUK) recently called on the Government to increase funding for teaching in England by linking tuition fees to inflation.

Teaching funding per student in England is at its “lowest point since 2004” and the current £9,250 fee would have been worth £5,924 in 2012/13,  UUK said.

Conservative shadow education secretary Laura Trott said Labour had “declared war” on students as she said students will “suffer” at a time when they can least afford it.

The University and College Union (UCU) described the fee increase as “economically and morally wrong”.

The National Union of Students (NUS) called it a “sticking plaster” and called for universities to no longer be funded by a rising debt on students.

But UUK, which represents 141 universities, said the move was the “right thing to do” as “thriving” universities are essential to the country.

Professor Chris Day, chairman of the Russell Group and vice-chancellor of Newcastle University, called it a “welcome sign” that government is engaging seriously with the difficulties facing universities.

In 2020, Sir Keir pledged to uphold Labour’s commitment to abolish tuition fees during his party leadership campaign.

At the time, the then-shadow Brexit secretary said his party must stand by its plan to “end the national scandal of spiralling student debt” by scrapping the fees.

Three years later, Sir Keir revealed he was preparing to “move on” from this commitment.

In May 2023, he said the current student fee system was “unfair” but that the country found itself in a “different financial situation” to when Labour had pledged to scrap the fees.

In August 2023, the Labour leader insisted he would put in place a “fairer” deal for students and admitted that he would not be able to afford to attend university today because of the cost.

During the general election campaign in June, Sir Keir said he had backtracked on his promise to abolish tuition fees as he was a “common sense politician” and he wanted to prioritise getting the NHS “back on its feet”.