Higher Education Funding

Jayne Kirkham Excerpts

Wednesday 28th October 2026 Westminster Hall

[Jayne Kirkham (Truro and Falmouth) (Lab/Co-op)]

It is a pleasure to serve under your chairship, Ms Vaz, and I thank my hon. Friend the Member for Sheffield Central (Abtisam Mohamed) for securing this debate.

Access to higher education can be life changing for young people. However, this opportunity is already harder to grasp for young people in Cornwall. Students face the high costs of travelling from remote, disconnected areas or, if they stay local, the high costs of private renting in a tourism-heavy region. Students across the south-west face the second highest monthly living costs in the UK, at £1,212 per month, which is only £114 less than London. These financial barriers directly impact whether young people pursue higher education. While the 2025 UK-wide entry rate for 18-year-olds was 36.3%, the rate in the south-west was joint lowest at 30%, and in Truro and Falmouth it was 27.2%, which is the lowest rate on record since 2016.

Having universities close by with a variety of courses and offerings is key for young people in Cornwall to be able to access the higher education opportunities. HE is an investment in place, and nowhere more so than in Cornwall. It leads to economic growth, productivity and innovation, including higher wages, skills and regional development.

There are ongoing funding concerns in relation to higher education institutions in Cornwall, and it is integral that support for these vital institutions is considered. Losing higher education opportunities there, especially with the campus that is across the border in the constituency of the hon. Member for Camborne and Redruth (Perran Moon), means that Cornish students risk losing out on these opportunities.

Falmouth University, which began in my constituency, offers traditional creative arts alongside technical and entrepreneurial courses and produces nearly 7,000 highly-skilled graduates each year. Tuition fee income does not meet the costs of delivering these degrees, particularly in creative and technical universities like Falmouth. That leaves universities with a difficult choice: sacrifice their core academic delivery for research investment or engage with more corporates. Government funding is cost-intensive to obtain and competitive, and frequent changes to Government funding models make it very hard to plan effectively. Specialist institutions like Falmouth are unevenly affected by those higher costs to secure fewer grants.

Funding for these integral institutions cannot fall by the wayside. They offer local employment opportunities, produce wider economic benefits and give young people in Cornwall a tangible place to pin their aspirations. I welcome the Government’s reintroduction of funding for higher education through targeted, means-tested maintenance grants, which will support low-income students from deprived areas to access and excel in higher education. We need to ensure that funding for a diverse range of courses that allow young people to gain skills and access to new experiences is accessible, realistic and enables the higher education sector to continue to foster ambition in Truro and Falmouth, Cornwall, the south-west and across the UK.

--- Later in debate ---

[Rebecca Smith (South West Devon) (Con)]

It is a pleasure to serve under your chairmanship, Ms Vaz, and to respond on behalf of His Majesty’s official Opposition.

I thank the hon. Member for Sheffield Central (Abtisam Mohamed) for tabling this important debate and all Members for their contributions this morning. I have to say that I did not expect to hear quite so much agreement for Margaret Thatcher’s education policies this morning. I am particularly grateful to the hon. Members for Edinburgh South West (Dr Arthur) and for Camborne and Redruth (Perran Moon) for their positivity about that.

Let me pick up on the points made by the hon. Member for Southampton Itchen (Darren Paffey). Although I think we are the same age, he started at Southampton University a year after me, but we have many mutual friends from our time at university. It is worth noting that the changes we experienced as the first cohort that had to pay fees and take on a loan were due entirely to the Teaching and Higher Education Act 1998, which was snuck through by the new Labour Government and then conveniently forgotten about, in a time where social media did not exist. I dread to think of the furore if today’s students realised that that was going to happen to them, but I for one, aged 16, thought I was going to university for free, but by the age of 18 that was not the case.

[Jayne Kirkham]

Will the hon. Lady give way?

[Rebecca Smith]

I am going to make some progress.

I do not want to burst the bubble of the hon. Member for Sunderland Central (Lewis Atkinson), but Plymouth has also had dentistry offered as a subject. Unfortunately, only about 5% of the students are from Plymouth and nearly all of them leave the area, so although we absolutely need more dentistry students, so far that has not quite been the mechanism to solve the crisis that we hope it will be—although that is a debate for another time.

To respond to the topic of the debate, let me put it on record that the Opposition recognise the enormous value and significance of the UK’s university sector in terms of its economic and societal contribution. The National Centre for Universities and Businesses argues that the UK’s universities are

“one of our greatest strategic assets. They educate the future workforce, conduct world leading research, and act as anchor institutions in their regions—supporting businesses, driving innovation, and powering local growth.”

Economically, universities contribute around £265 billion to the UK economy and support more than 800,000 jobs. The return on investment is also staggering. For every £1 of public money invested in the higher education sector across the country, £14 is put back into the economy.

In addition, there is no doubt that universities are some of the most critical engines of growth and prosperity at the regional level. As the proud Member of Parliament for South West Devon, I know the huge role that the sector plays across the south-west. We have 10 universities with more than 200,000 students between them, employing more than 31,000 people and contributing £7.8 billion of gross output. Plymouth Marjon University, Arts University Plymouth and the University of Plymouth are certainly playing their part. I am meeting the vice-chancellor of Plymouth University tomorrow to discuss this very topic. Although I unfortunately cannot add any more today, I know that he wants to talk to me about the struggles that the university is facing.

Notwithstanding this vital economic contribution, it would be wrong to look at universities purely in terms of their economic output. Universities help to shape the society we all live in. They equip young people with the skills needed to navigate an increasingly fractured society. They teach young people to think critically and outside the box, skills that I believe will be essential in a Britain where communities are more divided than ever and the spectre of the AI revolution looms over us all. It is beyond clear that universities will play a central role in Britain for decades to come. That is our view, but we are not blind to the big challenges facing the sector.

It is no secret that real and imminent challenges face the UK’s university sector. A May 2026 report from the Education Committee went so far as to claim that the sector faces a financial crisis that poses a real risk of institutional insolvency. The report laid bare the terrible state of some universities’ finances, with the Office for Students fearing that 24 providers could face insolvency within the next 12 months. Against this uncertain backdrop, universities are being forced to close courses and sell buildings to cut costs and make efficiencies.

The difficulties facing universities are explained well in the Policy Exchange report, “Tarnished Towers”. It argues that high inflation, pension pressures and a reduction in international student numbers have created a perfect storm for our universities. It all seems to be compounded by a lack of action from the Government thus far. A Universities UK report from February 2026 found that Government policy decisions will

“lead to an estimated £3.7 billion reduction in funding to higher education providers in England from 2024-25 to 2029-30.”

Its analysis shows the impact of Government immigration policy, but also the damaging shock that the sector received through increased pension and employment costs.

In 2020, Keir Starmer made scrapping university tuition fees the centrepiece of his leadership campaign. Indeed, in June 2023, the previous Education Secretary even had the audacity to claim that graduates would pay less under a Labour Government. Students right across the country felt betrayed and let down by the Government’s broken promises when the previous Education Secretary announced in November 2024 that Labour would push up tuition fees for students. In that debate, the shadow Education Secretary, my right hon. Friend the Member for Sevenoaks (Laura Trott), said that she would be willing to work with the Government to support universities and students. His Majesty’s Opposition are yet to be invited to work constructively with the Government on that—indeed, we have heard very little at all from the Government about what they want to do. I hope the Minister can shed some light on the Government’s plans to support our university sector.

The new Education Secretary has been keen to talk about her plans to reform technical education, but aside from providing a statement on that issue in the House, we have heard little else. She has not come to the House to clarify when the Government will bring forward the legislation they promised at the King’s Speech to support children with SEND and their families, or to talk about the challenges facing the university sector.

I am grateful to the hon. Member for Sheffield Central for securing this debate, as it gives His Majesty’s Opposition some time to ask the Minister, whom I respect very much, some important questions about higher education funding. First, can the Minister shed any light on how the Government intend to support the 24 institutions that the Office for Students claimed are at risk of insolvency in the 12 months from May 2026? Secondly, can she confirm whether the Government intend to make any changes to plan 2 student loans? Thirdly, can the Minister tell the Chamber whether she has had any meetings with institutions that might be facing significant financial uncertainty during the remainder of this academic year? Lastly, will the Government rule out pushing up student tuition fees again before the end of this Parliament? His Majesty’s Opposition, the higher education sector and, most importantly, students right across the country need answers to those important questions. Universities need them to begin to develop long-term financial plans, and students need to have certainty about their finances and about the stability of the institution they are studying at and the course they are taking.

Regrettably, I hold little hope that the Government have answers to those questions, given the lack of focus that the new Education Secretary seems to have shown to higher education since coming into office. That is in stark contrast to the official Opposition: we have outlined detailed and fully costed plans to lower interest on plan 2 student loans and set out reforms to the university sector to ensure that the Government stop funding dead-end university courses. That is all part of our new deal for young people.

I reiterate His Majesty’s Opposition’s firm belief in the strength and value of the UK’s higher education sector; it is indeed a huge strategic asset. However, we must be honest and recognise that it will face huge challenges over the next decade. The digital revolution means that universities need to rethink how they prepare students for the world of work, and they must be open to accepting that they must adapt to stay solvent in the new economic reality.

The Government should be there to guide the sector through these turbulent headwinds, but we have seen little indication that they are. The new Education Secretary urgently needs to shed some light on what steps they will take to address some deeply concerning reports about the financial health of our institutions. The Budget is a little over an hour away; I hope that the Chancellor will set out steps to solve these problems, but I hold out little hope.

--- Later in debate ---

[Georgia Gould]

Of course, I always support greater funding for education and young people, but I was just about to talk about some of the changes the Government are making to support sustainability.

After they were frozen for eight years, we increased tuition fee caps in line with inflation for 2025-26. We will increase them once again in line with forecast inflation in 2026-27 and in 2027-28. We will then legislate when parliamentary time allows to increase tuition fee caps automatically for future academic years. Over the coming year, that is £6 billion-worth of safeguarded indexed increase in income underpinned by the Government, which will make a real difference.

My hon. Friend the Member for Sheffield Central asked about the Government’s vision for universities. We have set out an ambitious programme of reform through the post-16 education and skills White Paper, with a clear vision for a more sustainable and collaborative higher education sector. We want providers to be clear about their distinctive roles but to be working in collaboration.

My hon. Friend also mentioned the importance of research. My hon. Friend the Member for Bury St Edmunds and Stowmarket (Dr Prinsley) talked about the pioneering research on prostate cancer at East Anglia. Research is a critical role that universities play. The Government are investing a record £86 billion in R&D from 2026-27 to 2029-30; as part of that, UK Research and Innovation will deliver an expected £38.6 billion of research investment, rising to nearly £10 billion per year by the end of that period. In the Department for Education, we are working closely with the Department for Science, Innovation and Technology to deliver the White Paper’s commitments, which include research funding reform and improvements to research grant cost recovery.

We heard from almost all the Members who spoke in the debate about the importance of opening up access and ensuring that young people who want to go to university can always pursue that route. That is why we do not support the Conservatives’ proposals, which would pull up the drawbridge because they are about reducing the number of young people going to university. We know that young people from disadvantaged backgrounds will be the ones who do not get that opportunity.

[Jayne Kirkham]

It is important to note that in the 1980s, only about 10% of people went to university. The Blair Government opened that up to 50% of the population, and that is worth putting on the record.

[Georgia Gould]

We want two thirds of young people to participate in higher-level learning, whether that is going to university, pursuing an apprenticeship or a technical route. We see all of those as deeply connected.