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Research Article
A sector-wide financial crisis in higher education: a scoping review of institutional responses in England
,Vitaliy Shpachuk‡
,
vit.shpachuk@ncl.ac.uk
Sharifah Intan Sharina Syed-Abdullah§
sharifahintansharina@upm.edu.my
Abstract
English higher education (HE) is experiencing acute financial instability, driven by rising staff and compliance costs, a cap on tuition fees, and declining international student income. This article offers the first synthesis of recent fragmented scholarship on how English universities are responding to these pressures, using Resource Dependence Theory (RDT). A scoping literature review of peer-reviewed studies published between 2020 and 2025 was conducted using Scopus with predefined inclusion and exclusion criteria. Records were screened for relevance and eligibility, and findings were analysed through thematic analysis; the review was complemented by case studies of three English universities to contextualise sector-wide patterns. Seventeen records were identified and sixteen studies met the inclusion criteria. Four strategic response patterns were identified: buffering (for example, voluntary redundancy schemes, course closures and operational streamlining), bridging (for example, internationalisation, industry partnerships and digital provision), restructuring (for example, intensified managerial control and consultancy logics) and sustainability, which emerged as a cross-cutting but fragile concern shaped by stakeholder power and financial slack. The findings suggest that, while universities display adaptive capacity, many responses generate new or intensified resource dependencies. More holistic approaches are therefore needed that balance financial efficiency with academic integrity, public purpose, stakeholder legitimacy, environmental sustainability and the governance implications of artificial intelligence.
Keywords
Englanduniversitieshigher educationfinancescoping literature reviewcase studiesSupplementary Files
- Supplementary Material
Introduction
The UK higher education (HE) sector is one of the country’s key economic and cultural assets, with universities serving as major employers and central institutions in their local communities (Kett & Ashford 2024). International student recruitment, in particular, has become a vital component of the UK’s export economy and institutional funding models (International Education Strategy 2021). Yet, despite a long history of financial resilience strategies—including diversification of income (Marginson 2013), restructuring of provision (Shattock 2014), adoption of managerial reforms (Ovseiko et al. 2015) and commercial activity (Taylor 2014)—the sector is now entering a period of acute financial instability.
Financial pressures stem from rising pay, energy and compliance costs amid inflation (ONS 2025), a long-frozen (recently raised by 3.1 per cent) fee cap (DfE 2024), and falling international income (Home Office 2025). Non-UK entrant numbers in 2024–5 were ∼21 per cent below projection, with up to 72 per cent of English providers forecast to be in deficit in 2025–6 (OfS 2025). In 2025, course closures (49 per cent), programme consolidation (55 per cent) and redundancies (25 per cent) were reported (UUK 2025a).
This paper investigates the financial resilience strategies of English universities, drawing on a scoping literature review (2020–5) and case studies of three institutions. The paper argues that, while English universities have demonstrated considerable adaptive capacity, the current configuration of strategies risks reproducing instability. To secure the future of the sector, new approaches are needed that combine financial resilience with academic integrity, stakeholder legitimacy, sustainable governance and advancement of working with artificial intelligence.
This paper proceeds by presenting our underpinning theoretical ideas around Resource Dependence Theory, which highlights how organisations manage environmental uncertainty and resource constraints. Then, the context of the financial crisis in the universities in England is outlined and the methodology is explained, followed by an analysis of key relevant thematic areas in the literature and the case-study analysis, accompanied by a discussion of these findings. This analysis is crucial for understanding the current landscape of financial resilience in higher education and identifying areas that require further development.
Context: current challenges in UK higher education
Recent comparative research shows that universities around the world are increasingly caught in a tension between bureaucratic governance (formalisation, hierarchy, accountability) and strategic management logics (competition, performance metrics, external funding), a trend documented in places like Europe, Australia and Asia-Pacific (Woelert & Stensaker 2025). Similarly, issues of casualisation, de-professionalisation and stratification of academic labour are being reported globally (Elken & Borlaug 2024). However, the UK appears especially vulnerable, given its heavy dependence on international student fees combined with frozen home tuition rates and recent visa restrictions.
UK higher education institutions (HEIs) are facing unprecedented financial strain, the result of rising costs, frozen domestic funding, reliance on international student fees, and wider global and national policy shifts. These pressures build on longer-term challenges and risk undermining institutional stability and the UK’s global standing in higher education.
Rising costs and domestic funding pressures
In recent years, the costs of staff pay, pensions, energy and regulatory compliance have all escalated, straining university budgets (Kett & Ashford 2024). Alongside these pressures, the tuition fee cap for UK students remained frozen at £9,250 between 2017 and 2025. This erosion of real-terms value reduced funding per student to its lowest level in over twenty-five years. According to the Russell Group (2022), when adjusted for inflation, the £9,250 fee is equivalent to just £6,585 in 2012 terms. The average deficit incurred by English universities for teaching each undergraduate has therefore risen from £1,750 in 2021–2 to around £4,000 in 2024–5. This average also masks substantial variation by subject. High-cost provision, including laboratory-based, clinical, creative and specialist courses, may incur significantly larger shortfalls because staffing, equipment, estates and regulatory costs are higher, while the regulated home fee remains broadly uniform across most undergraduate provision.
Although the Labour government announced a modest increase in the cap1 to £9,535 for the 2025–6 academic year, this uplift is insufficient given the rate of inflation and rising costs. Furthermore, the simultaneous increase in employer National Insurance contributions from April 2025 will offset much of this additional revenue. Compared internationally, UK expenditure per student remains low: OECD averages stand at approximately USD 11,400 per student in general upper secondary education and USD 13,200 in vocational programmes. Countries such as Luxembourg (over USD 26,000), Austria, Norway, and Germany (over USD 20,000, USD 20,000 and USD 15,000, respectively) invest substantially more, with Korea and Switzerland also exceeding USD 19,000 per student (Eurostat 2025).
A further pressure concerns the long-term expansion of participation in higher education. The move towards mass higher education, symbolised by the Blair government’s target that 50 per cent of young people should participate in higher education (Ayres 2024), increased the scale and diversity of the student body. While this expansion has brought important social and economic benefits, it has also increased institutional responsibilities for teaching, assessment, student support and pastoral care. In particular, growing student mental health and well-being needs have placed additional demands on university services at a time when the core unit of resource for home students has declined in real terms.
Reliance on international students and policy shifts
For decades, universities have pursued financial resilience strategies by diversifying income, particularly through the recruitment of international students (Deem 1998; Taylor 2003; Marginson 2013; Taylor 2014; Shattock 2014; Ovseiko et al. 2015; Roberts 2017). Government initiatives reinforced this trend: the International Education Strategy (2019, updated 2021) set a target of attracting 600,000 international students by 2030, a milestone reached within four years.
However, this reliance on international fee income—£9.4 billion in 2022–3, representing one fifth of the of the sector (Drayton et al. 2025)—has left institutions highly vulnerable to shifts in global and domestic policy. The introduction of visa restrictions in January 2024, including prohibitions on many students bringing dependants, had an immediate effect: visas issued for dependants fell by 80 per cent in the first quarter of 2024, and student visas declined by 26,000 compared with the same period in 2023 (Home Secretary 2024).
As a result, the Office for Students (OfS 2025) reported that non-UK student recruitment in 2023–4 was 15.5 per cent below forecast, with the downward trend expected to continue in 2024–5, leading to entrant numbers projected to be 21 per cent lower than earlier estimates. Drayton et al. (2025) caution that, without significant savings, a sector-wide surplus of £1.5 billion in 2022–3 could shift to a deficit of £1.6 billion by 2025–6.
Subsequent OfS (2026) analysis suggests that this pessimistic outlook is broadly materialising, although the precise final sector position for 2025–6 will not be known until institutional accounts are complete. The OfS November 2025 update reported that, without mitigating action, 124 providers, or 45 per cent of the sector, could report deficits in 2025–6, alongside a £437.8 million shortfall in tuition-fee income compared with providers’ forecasts. This indicates that the predicted deterioration has not been avoided, even if the eventual aggregate deficit may differ from earlier projections.
Future policy changes may intensify this exposure. The government’s international student levy, currently set out as a flat fee of £925 per international student per year from August 2028, would further reduce the net income universities derive from international recruitment (DfE 2025). Although its implementation falls outside the immediate period of the review, it is relevant to the sector’s medium-term financial outlook because it may offset some of the gains from any future domestic tuition-fee uplift and further complicate institutions’ reliance on international student income (UUK 2025b).
Sector-wide deficits and institutional responses
These pressures have already resulted in significant financial losses. In 2022–3, the higher education sector faced a £5.3 billion deficit, with more than a fifth of universities (weighted by income) reporting an in-year shortfall (Drayton et al. 2025). Such systemic problems in funding models are likely to worsen in 2025–6, with further institutions expected to move into deficit.
These pressures are not evenly distributed across the sector. Institutions differ markedly in their exposure to international recruitment, research intensity, regional student markets, estate costs, subject mix, reserves and borrowing capacity. The financial crisis therefore risks widening existing inequalities between universities. Better-capitalised, research-intensive or internationally prestigious institutions may be better placed to absorb shocks, while institutions with narrower margins, weaker reserves or greater dependence on particular student markets may face more severe constraints. One possible implication is the re-emergence of a more visibly stratified or ‘two-tier’ system, despite the formal unification of the university sector following the Further and Higher Education Act 1992 (Ayres 2024).
Universities have responded with extensive cost-cutting measures. A Universities UK (UUK 2025a) survey of sixty institutions revealed:
49 per cent closed courses to reduce costs, more than double the 24 per cent recorded in the previous year.
55 per cent consolidated courses (up from 23 per cent).
46 per cent cut optional modules (up from 29 per cent).
18 per cent closed entire departments (up from 9 per cent).
25 per cent made compulsory redundancies (up from 11 per cent).
Operational budgets have also been squeezed: 60 per cent scaled back maintenance and repairs (up from 49 per cent), 51 per cent cut catering (up from 30 per cent), and 46 per cent reduced IT spending (up from 26 per cent). Looking ahead, 89 per cent of institutions anticipate further reductions in maintenance over the next three years, while 88 per cent expect more course closures or consolidations.
Implications for students and the sector
Despite these cuts, universities have so far managed to maintain a relatively strong student experience. A Universities UK (UUK 2025a) survey of students found that over 85 per cent responded positively to questions on academic support. This suggests that, while core teaching and support remain intact, the contraction in provision is narrowing student choice. Such reductions risk constraining workforce pathways, undermining commitments made in the UK’s industrial strategy and diminishing the sector’s role in driving wider economic growth. They also risk a less easily quantifiable loss: the erosion of knowledge, scholarship and disciplinary diversity for their own sake. If provision in less commercially attractive subjects, such as smaller languages, specialist humanities fields or neglected historical periods, disappears from parts of the sector, the consequences extend beyond immediate labour-market outcomes to the longer-term intellectual and cultural capacity of the university system.
The cumulative effect of these pressures is severe. Financial fragility threatens not only the stability of individual universities—including the risk of bankruptcy—but also the sector’s international competitiveness, research capacity and global reputation. In this context, it is crucial to develop a comprehensive overview of the strategies universities employ to improve financial efficiency and resilience, in order to understand both their potential and their limitations. Without new conceptual and policy solutions, the UK higher education system faces the prospect of further instability and long-term decline.
Theoretical considerations: resource dependence theory
This section introduces Resource Dependence Theory and contextualises its application within higher education.
Overview of resource dependence theory
Resource Dependence Theory (RDT), originally developed by Pfeffer & Salancik (1978), has become ‘one of the most influential theories in organisational theory and strategic management’ (Hillman et al. 2009: 1404). The theory rests on the fundamental assumption that organisations are not self-sufficient but must secure critical external resources to survive and prosper. This dependence creates vulnerability and exposes organisations to uncertainties in their external environment.
According to Casciaro & Piskorski (2005), RDT centres on several interrelated constructs that explain how organisations navigate their environments. At its core is the notion of resource control—the idea that organisations strive to secure and retain access to vital external resources essential for their survival and success. This quest for control inevitably gives rise to power asymmetries, as reliance on external entities generates imbalances in influence and autonomy. To manage these dependencies, organisations often engage in inter-organisational relationships, forming alliances, partnerships or even mergers that allow them to negotiate access to critical resources.
Crucially, RDT also emphasises adaptation strategies—such as buffering, bridging and restructuring—which organisations use to cope with environmental uncertainty and maintain strategic flexibility (Drees & Heugens 2013; Greenwood & Tao 2021). Buffering involves insulating the organisation from external shocks: for example, by maintaining slack resources or diversifying suppliers. Bridging refers to building inter-organisational ties—such as partnerships and alliances—to secure critical resources and reduce dependence. Restructuring entails altering organisational boundaries or power relations, including mergers, vertical integration or contract renegotiation, to reshape dependencies. Together, these strategies enable organisations to mitigate environmental pressures and maintain strategic flexibility (Greenwood & Tao 2021).
Organisations seek to manage these dependencies by either reducing their reliance on others or attempting to increase others’ dependence on them. As Pfeffer & Salancik (1978: 1) explain, ‘organisations are constrained by and respond to the external environment’, and their survival depends on their ability to navigate these interdependencies effectively. Moreover, interdependencies are not limited to external relations; intra-organisational coalitions and internal politics also shape how resources are accessed and deployed (Hillman et al. 2009). Such interdependences are the reason why organisational performance outcomes never fully match their expected outcomes. Any event that depends on more than one actor is an outcome determined by dynamic interdependent entities (Pfeffer & Salancik 1978).
Organisational performance, therefore, is not merely a function of internal capability, but also of how effectively organisations manage external constraints and opportunities (Drees & Heugens 2013; Greenwood & Tao 2021). Strategic responses can include forming alliances, lobbying regulators, diversifying funding sources or restructuring internal processes to reduce exposure to external shocks.
Resource dependence theory and higher education
Higher education institutions (HEIs) in England operate in a hybrid organisational position. They are financially autonomous organisations that must balance budgets, compete for students and research income, and manage exposure to volatile external resource flows. However, they are not equivalent to private firms. Most universities retain charitable and public-purpose missions, receive public funding through teaching and research streams, and are embedded in professional, disciplinary and collegial forms of governance (Jones 2025). Their resource dependencies are, therefore, mediated not only by market pressures but also by public accountability (Kushnir & Brooks 2023), academic norms, expectations of staff and students, and sector-wide regulatory frameworks.
In legal and regulatory terms, many English universities are also exempt charities, with the Office for Students acting as principal regulator for relevant providers. They also continue to receive public funding, particularly through research and innovation streams distributed by UKRI (UK Research and Innovation) and Research England. This reinforces the point that their financial strategies are shaped by a mixed economy of tuition-fee income, public funding, research funding, philanthropy and commercial activity rather than by market income alone (OfS 2018).
This theoretical approach is useful and effective for us in the process of our study. It allows us to see how universities in England respond to resource uncertainty, and in particular what strategies they use to buffer, bridge or reconfigure dependencies. As Jones (2025) notes, the funding environment in UK higher education has become increasingly marketised, pushing institutions to behave strategically in their quest for financial resilience and reputational gain. In line with RDT, these institutions employ a variety of tactics to manage dependencies—whether through international partnerships, research consortia or private-sector collaborations (Fowles 2014).
A key implication of RDT, then, is that educational institutions (as with other organisations) are not simply passive recipients of environmental pressures but active agents who engage in strategic behaviour to manage those pressures—in line with Pfeffer & Salancik’s (1978) and Hillman et al.’s (2009) reasoning. This framing aligns closely with our analysis of financial resilience strategic responses in the English higher education sector.
There is limited direct application of RDT in qualitative research within higher education. Most studies using RDT in this field are quantitative, focusing on financial data, institutional expenditures and policy impacts (e.g., Kelderman 2012; Cantwell & Taylor 2015). However, some studies do engage with RDT conceptually to explore how universities respond to external pressures and resource constraints. For example, Kohtamäki (2023) used interviews and document analysis to examine how Scandinavian universities navigate governance and resource dependencies within performance agreements. Building on this foundation, the present study employs qualitative methods of a scoping literature review alongside a thematic analysis to address the limited qualitative applications of RDT in higher education, offering deeper insights into how English universities strategically navigate and manage resource dependencies.
Methodology
This paper draws on a scoping literature review of scholarship published between 2020 and 2025 that examines financial resilience strategies in English higher education. The review is complemented by three university case studies, which provide illustrative insights into institutional approaches. The aim is to synthesise and critically evaluate existing research that addresses the following question, while situating it within the case-study evidence: How do universities in England pursue resource control in response to environmental uncertainty?
The scoping literature review method
A scoping literature review of research on financial resilience strategies in English higher education, published between 2020 and 2025, was conducted. The choice of this period is deliberate: beginning in 2020, it captures the effects of COVID-19 and the end of the Brexit transition (Kushnir 2025a), while the cut-off date for the literature search of 7 August 2025 ensures inclusion of the most recent scholarship. This timeframe also encompasses key policy changes, technological developments and institutional responses to resource uncertainty. By focusing on these years, the review offers an up-to-date synthesis of financial resilience strategies, reflecting current practice and insights. The review followed the PRISMA-ScR (Preferred Reporting Items for Systematic reviews and Meta-Analyses extension for Scoping Reviews) guidelines (Tricco et al. 2018). The search was conducted via the Scopus database, which provides robust tools for managing and deduplicating search results, supporting transparency and reproducibility in scoping reviews (Martín-Martín et al. 2018).
The research question informed the development of a Boolean search strategy incorporating terms across four thematic categories—environmental and institutional contexts, strategic response, and geographical focus—to guide the identification of relevant literature. The search included truncated and phrase-based terms such as: TITLE-ABS-KEY((“higher education” OR universit*) AND (UK OR “United Kingdom” OR Britain OR British OR Engl*) AND (strateg* W/3 (cost* OR financ* OR budget* OR expenditur* OR saving* OR “cost-cutting” OR “cost-saving” OR efficiency OR restructure* OR downsiz* OR “course closure” OR “closing courses” OR “programme closure” OR “program closure” OR “degree closure” OR “department closure” OR “subject closure” OR “cutting courses” OR “course cuts”))).
Our search procedure is summarised in Figure 1. Table 1 details the inclusion and exclusion criteria considered in the search.
Figure 1.
PRISMA-ScR flow diagram of study identification and selection.
Flow diagram showing the PRISMA-ScR study selection process. A total of 108 records were identified from Scopus (last searched 7 August 2025) and all 108 were screened by title and abstract. Of these, 91 records were excluded (for reasons such as not relating to England, not higher education, or not focusing on financial response). Seventeen full-text reports were assessed for eligibility. One full-text report was excluded (commentary), resulting in 16 studies included in the final review.
Table 1
Inclusion and exclusion criteria.
Table showing inclusion and exclusion criteria for study selection. Studies were included if they were published between 2020 and 7 August 2025, peer-reviewed (articles, books, or book chapters), published in English, available in full text as open access, and based on original research (including systematic literature reviews). Studies were excluded if they were published before 2020 or after 7 August 2025, not peer-reviewed (such as theses or dissertations), not in English, lacked full-text access, or were commentaries.
| N | Inclusion criteria | Exclusion criteria |
|---|---|---|
| 1 | Published between 2020 and 7 August 2025 | Published before 2020 or after 7 August 2025 |
| 2 | Peer-reviewed articles, books, book chapters | Such outputs as theses and dissertations were not included as they do not go through such a rigorous review during a publication process as those selected. |
| 3 | Published in English | Published in a language other than English |
| 4 | Full text available in open access | Full text not available |
| 5 | Publications based on original research, including systematic literature reviews | Publications which are commentaries |
In the third stage of the literature search (Figure 1), the titles and abstracts of the seventeen results from stage two were screened against inclusion/exclusion criterion 5 (Table 1), leading to the removal of one article due to it being a commentary. Titles/abstracts and full texts were screened by the lead author against the eligibility criteria. Data were extracted into a structured spreadsheet capturing bibliographic details, study focus, methods and reported institutional responses. Extraction was undertaken by the lead author and checked through re-reading of included papers; no automation tools were used. Risk of bias/quality appraisal was not conducted because the review aimed to map and interpret institutional response strategies rather than estimate effect sizes; this is noted as a limitation.
Sixteen articles were therefore included in the thematic analysis, which followed Kushnir’s (2025b) four-stage guide: (1) coding key words and phrases, (2) developing tentative themes, (3) reviewing, renaming or restructuring themes and (4) establishing their order and hierarchy. Thematic analysis was chosen to synthesise diverse study designs and identify recurring institutional response patterns across the literature. The primary outcomes/data of interest were reported institutional financial resilience strategies and associated rationales, mechanisms and consequences, interpreted through RDT. All included studies were eligible for synthesis and were analysed through thematic coding; studies were then grouped within four thematic domains, as specified below, based on the dominant institutional response strategies reported. Individual studies could contribute to more than one domain where relevant. Heterogeneity was not formally analysed due to the small and diverse evidence base. Theme robustness was checked by revisiting coded extracts and refining themes iteratively.
The four key themes generated through critical analysis and synthesis are presented in the next section:
1.
Buffering: internal restructuring and cost management
2.
Bridging: partnerships, collaboration and external engagement
3.
Restructuring: governance transformation and strategic control
4.
Sustainability and stakeholder dependence (cross-cutting theme).
The case-study approach
The scoping literature review was complemented by three university case studies examining financial resilience strategies: Newcastle University, the University of Sussex, and Nottingham Trent University (NTU). The sample was designed for contrast, selecting institutions that differ in type, location, size (students and staff), age, and proportion of international students, in order to capture how the financial crisis affects universities differently (see Table 2). These institutions are treated as instrumental case studies, which, in Stake’s (1995) terms, are examined primarily to illuminate a broader issue and to inform generalisations about financial resilience in English higher education.
Table 2
Contextual information about the selected case studies.
Table presenting contextual information about three selected case study universities. Newcastle University is a Russell Group, research-intensive institution located in the North East, with around 29,000 students and over 5,000 staff; it was founded in 1834 and became an independent university in 1963, with approximately 25% international students. The University of Sussex is a mid-tier university in the South East, with around 18,000 students and approximately 2,000--2,500 staff; it was founded in 1961 and has about 33% international students. Nottingham Trent University is a post-1992, teaching-focused institution in the East Midlands, with over 40,000 students and over 4,000 staff; it was established in 1970 as Trent Polytechnic and gained university status in 1992, with around 19% international students.
| University | Type | Location | Size | Age | Approximate International student ratio |
|---|---|---|---|---|---|
| Newcastle University | Russell group, research-intensive | North East | Around 29,000 studentsOver 5,000 staff | Founded in 1834 (as a School of Medicine and Surgery); became an independent university in 1963 | 25% |
| University of Sussex | Mid-tier | South East | Around 18,000 studentsApprox. 2,000–2,500 staff | Founded in 1961 | 33% |
| Nottingham Trent University | Post-92, teaching-focused | East Midlands | Over 40,000 studentsOver 4,000 staff | Established in 1970 as Trent Polytechnic; gained university status in 1992 | 19% |
The three cases were selected to provide contrast rather than to represent the full range of institutional exposure to international student recruitment. Their international student ratios, ranging between approximately 19 per cent and 33 per cent, capture meaningful variation but do not include institutions with much higher levels of dependence on international fee income. The case studies should therefore be read as illustrative of different institutional positions within the English sector, rather than as exhaustive of the sector’s most internationally exposed providers.
For the three cases, we reviewed publicly available institutional documents such as Integrated Annual Reports, Financial Statements, and Council updates published on their official websites. Publicly available information is limited, however: while NTU’s documentation reports two severance schemes, one of the authors (affiliated with NTU) is aware of three such schemes since 2022, and no formal web-based documentation exists regarding the closure of NTU’s School of Arts and Humanities (the remainder of which was merged into the School of Social Sciences). Similarly, Sussex and Newcastle have provided only headline data on cost-saving measures, with finer detail on redundancies and programme changes reported primarily through local or sectoral news outlets. Accordingly, selected media sources were drawn upon to complement institutional materials.
The data from the three cases have been analysed thematically (Kushnir 2025b), relying on the themes generated by the scoping literature review, detailed above. The data from the case studies have been used as examples to illustrate the themes from the scoping literature review analysis.
Findings: english universities’ responses to financial uncertainty
To recap, RDT highlights three key adaptation strategies: buffering, which involves insulating the organisation from environmental shocks by creating internal slack and reducing exposure to volatile external resources; bridging, which builds external connections and partnerships to secure critical resources; and restructuring (or power repositioning), which reconfigures governance arrangements and organisational boundaries to manage dependencies (Pfeffer & Salancik 1978; Drees & Heugens 2013; Greenwood & Tao 2021).
Our thematic analysis, applied to the scoping review of literature and case studies, and informed by Resource Dependence Theory, reveals four interrelated strategic responses that English universities have adopted to navigate financial uncertainty and resource constraints: (1) buffering through internal restructuring and cost management, (2) bridging via partnerships, collaboration and external engagement, (3) restructuring through governance transformation and strategic control, and (4) a cross-cutting focus on sustainability and stakeholder dependence, which runs across the above three strategies and reflects longer-term challenges for institutional resilience.
Buffering: internal restructuring and cost management
Universities attempt to insulate themselves from external shocks by creating internal slack, reducing expenditure and limiting vulnerability to volatile income streams. A range of buffering strategies have been documented in recent scholarship, the most prominent being voluntary redundancy schemes, closure of courses and departments, and operational streamlining.
Voluntary redundancy schemes (VRS) have been widely adopted as a means of reducing staff costs and reshaping institutional profiles in response to resource constraints. Marini & Meschitti (2025) show that VRS have become a standard tool of human resource management in marketised higher education, enabling institutions to restructure without resorting immediately to compulsory redundancies. Jones (2025), however, stresses that redundancy is not simply a financial measure but a deeply felt social and cultural process that reshapes the experiences of staff, often leaving lasting scars on institutional culture. The prevalence of voluntary rather than compulsory exit routes may also reflect the distinctive labour relations of higher education, where unionisation, professional autonomy and the reputational risks of industrial conflict can limit the scope for more abrupt workforce restructuring.
Case-study evidence illustrates this strategy clearly. Newcastle University’s Integrated Annual Report 2023–24 records £5.7 million in severance payments to 278 staff, with £4.4 million directed to a Voluntary Severance Scheme covering 150 colleagues, compared with just £0.6 million the previous year (Newcastle University 2025). This aligns with management’s commitment to deliver £20 million in salary savings and £10 million in non-pay savings as part of a transformation programme, with approximately 300 full-time equivalent roles under review (Newcastle University 2025; Newcastle University News 2025). Nottingham Trent University (NTU) has also relied on severance schemes, with more than 200 staff accepting packages worth £9 million, contributing to a £9.7 million surplus in July 2024 (Nottingham Trent University 2024; Nottinghamshire Live 2025). At Sussex, around 300 jobs were targeted in 2024 under a voluntary redundancy scheme designed to save £44 million following a sharp fall in international student numbers ( Brighton & Hove News 2024; Times Higher Education 2024; University of Sussex 2024).
The closure of courses and departments has been another common buffering strategy. Institutions have reduced exposure to less profitable provision, particularly in Arts and Humanities. Finn (2025) documents the wave of closures of History Department across the UK, reflecting financial logics that prioritise high-demand or high-fee subjects. Williamson (2025) similarly examine how ‘low-value’ arts degrees are delegitimised under neoliberal funding regimes, positioning closure as both an economic and ideological act. NTU’s restructuring of its Confetti division (which teaches students on creative industry courses) in 2025, accompanied by a Mutually Agreed Resignation Scheme (MARS) and course reductions, illustrates how these closures are operationalised at institutional level ( Nottinghamshire Live 2025). Such closures should, therefore, be understood not only as cost-saving measures but also as interventions in the ecology of knowledge. From an RDT perspective, subjects with weaker market demand or lower external income may become more vulnerable, even where they retain scholarly, civic or cultural value.
Universities also pursue efficiency gains through operational streamlining: pausing growth, merging units and optimising performance indicators. Shore (2026) critiques the increasing role of management consultants in steering such processes, while Woelert & Stensaker (2025) conceptualise the trend as the rise of ‘strategic bureaucracy’, in which managerial control is enhanced through new performance management systems. Newcastle’s non-pay savings drive, including reductions in estate and IT expenditure, reflects these logics in practice (Newcastle University 2025). Sussex, too, has scaled back planned investment in infrastructure as part of its cost-control measures ( Brighton & Hove News 2024).
Taken together, buffering strategies highlight how universities attempt to cut costs and stabilise finances. Yet they often exacerbate staff precarity, narrow the range of academic provision and erode trust, creating new risks for long-term sustainability.
Bridging: partnerships, collaboration and external engagement
Bridging strategies applied by English universities aim to reduce dependence on unstable funding sources by creating new connections and resource flows through promoting cross-institutional collaboration, internationalisation and branch campuses, university–industry collaboration as well as digital and remote learning.
Power-Mason et al. (2025) show that higher education apprenticeships, as a form of cross-institutional collaboration, have weathered financial turbulence partly through collaborative models that share costs and expertise. Such cross-institutional approaches exemplify RDT’s bridging logic by pooling resources and reducing vulnerability to market fluctuations.
Hickey & Davies (2024) find that the success of international branch campuses depends on careful strategic alignment and local partnerships, but they also underscore the role of internationalisation more broadly as a revenue diversification strategy. Yet recent visa restrictions have curtailed growth, leaving institutions such as Sussex heavily exposed to declining international enrolments. Sussex’s job cuts in 2024 were explicitly linked to a drop in overseas student numbers, demonstrating the risks of dependence on this revenue stream ( Brighton & Hove News 2024; Times Higher Education 2024).
Hickey & Davies (2024) also identify university–industry partnerships as a growing source of resilience. Such collaborations enhance knowledge transfer, support research commercialisation and create alternative revenue pathways. At NTU, continued capital investment in a new Design & Digital Arts building reflects efforts to integrate industry-facing provision with teaching and research, positioning the university as a partner in regional innovation (Nottingham Trent University 2024).
Initially crisis-driven during COVID-19, digital provision has become an established means of accessing new student markets. Visvizi et al. (2023) argue that the pandemic accelerated a restructuring of higher education through digital technologies, while Power-Mason et al. (2025) suggest that remote delivery also enables more flexible partnerships. Newcastle’s cost-saving measures included investment in digital infrastructure as part of its transformation programme (Newcastle University 2025), illustrating how digitalisation is framed both as an efficiency tool and as a new resource channel.
Overall, bridging strategies enable universities to reduce their dependence on traditional funding sources, particularly domestic fees. However, they also expose institutions to new dependencies, such as on volatile international student flows or corporate partners whose priorities may diverge from academic values.
Restructuring: governance transformation and strategic control
Restructuring, or power repositioning, involves reconfiguring governance arrangements, organisational boundaries and decision-making structures to reshape resource dependencies (Greenwood & Tao 2021). English universities pursued four directions in this regard.
The first of these directions has been strategic bureaucracy. Woelert & Stensaker (2025) describe how bureaucratic and strategic logics converge in universities, intensifying managerial authority and reshaping decision-making. Shore (2026) critiques this evolution as the ‘capture’ of higher education by management consultants, embedding external expertise into internal governance. Both analyses highlight the blurring of boundaries between academic and managerial priorities.
The second of the restructuring directions has been the influence of management consultancy. Shore (2026) provides detailed evidence of how consultancies frame university futures, introducing private-sector logics into governance. Newcastle’s financial transformation programme, with the involvement of explicit consultancy, exemplifies this trend (Newcastle University 2025).
Another restructuring direction has been maximising vice-chancellor power and efficiency. Jones (2025) argues that leadership power and personal characteristics significantly shape institutional efficiency. Decision-making in times of crisis is often centralised around senior leaders, reinforcing the influence of vice-chancellors and governing boards. This resonates with Sussex’s Council-driven endorsement of voluntary severance in 2024 (University of Sussex 2024). Cheah et al.’s (2023) analysis reveals that a VC’s power and the constituents to VC power play a crucial role in determining the efficiency level of the university. Furthermore, the origin and gender of a VC will moderate the VC’s power in influencing the efficiency level.
Finally, the adjustments to the audit culture have been a common restructuring technique. Shore (2026) document how an intensifying audit culture generates survival anxiety among managers, pushing them to prioritise compliance and efficiency over academic values. This pressure is visible in Sussex’s warnings that 2024/5 would require ‘careful cost management’ in light of declining student numbers (University of Sussex 2024).
Restructuring thus captures both the internal governance shifts and the external penetration of managerial logics that reshape universities’ strategic direction. While these strategies may deliver short-term efficiency, they risk entrenching managerialism and further alienating staff.
Sustainability and stakeholder dependence
While buffering, bridging and restructuring describe discrete strategies, sustainability is a cross-cutting concern shaped by resource dependencies. Núnez Chicharro et al. (2024) find that financial slack enhances sustainability, while excessive staff costs undermine it. NTU’s £9.7 million surplus in 2024 demonstrates how cost-saving measures can generate short-term resilience (Nottingham Trent University 2024). By contrast, Newcastle’s £5 million deficit in 2023–4 highlights the risks of insufficient slack (Newcastle University 2025). Núnez Chicharro et al. (2024) also show that governance independence and gender diversity affect sustainability outcomes, while Woelert & Stensaker (2025) emphasise the growing role of external stakeholders in shaping decisions. The case studies illustrate this: NTU’s stability reflects stakeholder confidence, whereas Sussex’s cuts reveal vulnerability to shifts in student demand. Jones (2025) highlights how narratives of value, accountability and relevance reshape stakeholder relationships, while Williamson (2025) shows how policy discourses delegitimise certain disciplines. Sussex’s targeting of Arts and Humanities subjects reflects these ideological currents. Núnez Chicharro et al. (2024) note that eco-efficiency and sustainable finance performance are increasingly part of universities’ strategies. Newcastle’s transformation programme references efficiency and sustainability in tandem, linking environmental and financial concerns (Newcastle University 2025). Overall, sustainability appears to be not simply an outcome but a dimension of strategy shaped by the interplay of buffering, bridging and restructuring.
The analysis shows that English universities are adopting a wide repertoire of strategies to navigate financial crisis. Buffering dominates the immediate response, with widespread voluntary redundancy, course closures and cost control. Bridging offers alternative resource channels through internationalisation, partnerships and digitalisation, but carries new risks. Restructuring reflects deeper governance transformations, embedding managerial logics and external consultancy into decision-making. Sustainability, finally, emerges as a fragile and contested goal, dependent on the balance of slack resources, stakeholder power, and ideological frames.
Discussion
Understanding the current landscape of financial resilience in English higher education
The findings reveal that English universities are navigating financial precarity through a repertoire of strategies that reflect the three main responses identified in RDT: buffering, bridging and restructuring. The prevalence of buffering measures—particularly voluntary redundancy schemes, course closures and operational streamlining—demonstrates the urgency of cost containment. These approaches have immediate financial impact, but they also raise concerns about long-term consequences for academic cultures, breadth of provision and staff well-being (Finn 2025; Jones 2025). The case studies reinforce this trend: Newcastle, Sussex and NTU all relied heavily on voluntary exit schemes to stabilise budgets, illustrating how redundancy has become a normalised response to fiscal stress.
Bridging strategies, such as internationalisation, industry partnerships and digital delivery, underscore the sector’s reliance on diversifying revenue. These strategies are framed as entrepreneurial and forward-looking, yet the Sussex case demonstrates how dependence on volatile international student markets can create acute vulnerabilities. The literature similarly warns that bridging does not eliminate dependency but rather shifts it onto new actors, whether industry partners or global markets (Visvizi et al. 2023; Hickey & Davies 2024).
Restructuring strategies highlight deeper transformations in governance and organisational control. The rise of ‘strategic bureaucracy’ (Woelert & Stensaker 2025) and the influence of management consultancies (Shore 2026) illustrate how universities are reconfiguring internal power structures to respond to external pressures. Case-study evidence, particularly Newcastle’s consultancy-driven transformation programme and Sussex’s Council-led endorsement of cost-saving measures, shows how governance authority is centralised during periods of crisis. These shifts raise critical questions about accountability, transparency and the role of academic communities in decision-making.
Sustainability emerges as a cross-cutting concern. Financial slack, stakeholder confidence and ideological narratives all shape whether institutions can withstand shocks and plan for the future (Núnez Chicharro et al. 2024; Jones 2025). The contrast between NTU’s surplus and Sussex’s projected deficit underscores how unevenly financial resilience is distributed across the sector. This unevenness also raises a wider sectoral question: whether financial pressures will reinforce a de facto hierarchy between institutions able to invest, expand and absorb risk, and those increasingly required to contract provision, reduce staffing and narrow their academic portfolios. Moreover, environmental sustainability is increasingly linked to financial efficiency, though the integration of ecological concerns remains limited.
Taken together, the current landscape is characterised by a high reliance on short-term buffering, selective and risky bridging, governance restructuring that intensifies managerial control, and a fragile approach to sustainability. These findings confirm that universities are adapting creatively but also unevenly, with strategies often producing new dependencies as they mitigate old ones. These findings also suggest that financial resilience in universities cannot be understood only as managerial adaptation to external resource scarcity; it is also shaped by the internal character of universities as public-purpose, professionally regulated and collectively organised institutions.
Areas requiring further development
The analysis also highlights several areas where future policy and institutional practice need to evolve. First, the dominance of buffering strategies suggests that universities are trapped in a reactive cycle of cost-cutting. While financially expedient, this approach undermines long-term capacity and risks eroding staff morale and student choice. There is a need for more proactive strategies that balance fiscal prudence with investment in academic and social value. Second, bridging strategies must be rethought to reduce exposure to volatility. Internationalisation has delivered substantial revenues, but as the Sussex case shows, over-reliance is unsustainable. More resilient forms of bridging could include diversified global partnerships, regionally embedded industry collaborations and, where feasible, alumni philanthropy. However, philanthropy should not be overstated as a sector-wide solution: unlike some US institutions, most UK universities do not have large endowments or a deeply embedded culture of alumni-giving capable of substituting for stable public or tuition-fee income. Third, restructuring has tended to strengthen managerial power and embed consultancy logics, often at the expense of collegial governance. Future development requires rebalancing governance models to ensure that staff and students have a meaningful role in shaping strategic choices. Otherwise, restructuring risks further entrenching mistrust and disconnection between leadership and academic communities. Fourth, harnessing artificial intelligence (AI) presents both opportunities and risks for financial resilience. AI could enable more efficient administrative processes, personalised learning at scale and new forms of research collaboration, helping universities to reduce costs while enhancing value. Yet without careful governance, reliance on AI risks exacerbating inequalities, privileging short-term efficiency over academic quality and deepening dependence on external technology providers. Integrating AI into resilience strategies will therefore require both investment and robust ethical frameworks. Finally, resilience needs to be conceptualised more broadly. Financial resilience cannot be secured without addressing the interdependencies between resource flows, stakeholder legitimacy and ecological responsibilities. The literature suggests that universities must integrate financial, social and environmental sustainability into holistic strategies, moving beyond short-term fixes toward resilient models of governance and resource use (Núnez Chicharro et al. 2024).
Comparative evidence also suggests that England’s funding model is not the only possible arrangement. OECD data show that tertiary education systems combine public and private funding in markedly different ways, with countries adopting different balances between tuition fees, public subsidy and student support (OECD 2025). Eurydice’s comparative data on European student fee and support systems similarly demonstrate that public and government-dependent higher education systems vary considerably in their use of tuition fees, grants, loans and other forms of student support (European Commission/EACEA/Eurydice 2025). These models cannot be transferred wholesale because they reflect different fiscal settlements and political choices, but they indicate that financial resilience depends not only on institutional strategy but also on the design of the national funding settlement. Future policy debate in England should therefore consider whether the current balance between student fees, public grant, research funding and cross-subsidy from international students remains sustainable.
The evidence synthesised is limited by the small number of recent studies and uneven coverage across institution types. Much of the literature is descriptive and draws on publicly available documents or single-institution cases, which constrains comparability and limits causal inference. The themes should therefore be read as indicative sectoral patterns rather than definitive estimates of prevalence or effectiveness. Moreover, further research may benefit from cross-referencing these findings with other databases. Scopus was selected for this study for its broad coverage of peer-reviewed higher education scholarship and to support a focused, reproducible search. Nonetheless, relevant studies may exist in other databases or grey literature, and screening/extraction were undertaken by a single reviewer without assessment of reporting-bias, which present limitations of this study. A further limitation is that the case-study sample does not include institutions with very high proportions of international students; future research could examine whether the strategies identified here operate differently in providers whose financial model is more heavily dependent on overseas fee income.
Conclusion
This paper has examined how English universities are navigating an escalating financial crisis, drawing on RDT, a scoping review of recent scholarship and three institutional case studies. The analysis shows that universities employ a repertoire of strategies centred on buffering, bridging and restructuring, with sustainability emerging as a fragile but essential cross-cutting concern. Buffering measures such as voluntary redundancies, course closures and operational streamlining, provide immediate cost savings but risk eroding staff well-being, student choice and academic culture. Bridging strategies, particularly internationalisation and industry partnerships, generate alternative income streams but expose institutions to new forms of dependency and volatility. Restructuring has reconfigured governance and decision-making, often centralising authority and embedding managerial logics.
The case studies of Newcastle, NTU and Sussex illustrate both the diversity and the unevenness of these strategies in practice, with outcomes ranging from surpluses to deepening deficits. Taken together, the evidence highlights a sector that is resilient and adaptive, yet also constrained by short-termism and structural vulnerabilities. Future policy and institutional responses must, therefore, move beyond reactive cost-cutting to embrace more balanced, inclusive and holistic approaches to financial, social and environmental sustainability if the UK’s higher education system is to retain its global reputation and capacity for innovation.
CRediT roles
Iryna Kushnir: Project Administration, Conceptualisation, Data Curation, Formal Analysis, Methodology, Writing – Original Draft. Vitaliy Shpachuk: Project Administration, Writing – Original Draft, Writing – Review and Editing. Sharifah Intan Sharina Syed-Abdullah: Writing – Review and Editing.
Declaration of conflict of interest
On behalf of all the authors, the corresponding author states that there is no conflict of interest.
Ethical approval
This study did not involve human or animal participants and therefore did not require ethical approval. The research was based on the analysis of previously published literature and publicly available information on university websites.
Funding
The author/s received no financial support for the research and authorship of this article.
AI disclosure
ChatGPT-4o was used for proofreading the article and formatting the reference list.
Data availability statement
The articles used for the scoping literature review and websites reviewed for case studies in this article are specified in the body of the article and cited in the reference list. The PRISM-ScR checklist is available as supplementary material.
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1
It should be noted that the regulated fee cap does not represent the total amount repaid by many graduates. Under the income-contingent student loan system, interest accrual, repayment thresholds and repayment duration mean that some graduates repay substantially more than the headline tuition-fee amount, while others do not repay their loans in full before write-off. The student loan system has therefore become a parallel source of political and distributional controversy alongside the question of university funding (Lewis et al. 2026).
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DOI: 10.5871/jba/014.a21
Published on: 23 September 2026
Volume: 14
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Kushnir, I., Shpachuk, V. & Syed-Abdullah, SIS (2026), ‘A sector-wide financial crisis in higher education: a scoping review of institutional responses in England’, Journal of the British Academy, 14(3): a21 https://doi.org/10.5871/jba/014.a21Crossref
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July 2023
Scholasticide in Gaza Avi Shlaim
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Introduction: the state of the university, the university and the state Regenia Gagnier
Today the purpose of a university education is under question. Should it provide technicians and workers for productivity and international competition? Should it be a liberal education, interdisciplinary and problem-solving, preparing informed subjects/citizens for democratic decision-making? Should it be private, focussed on vocational training, funded by tuition from the rich, in institutions founded by philanthropists or entrepreneurs? Should it be public, managed as a bureaucratic corporation, with a parafaculty of public relations and advertising specialists, a driver of global enterprise? Or should it be mentored like a guild or college by self-motivating and self-regulating professionals who have internalised the means and mechanisms of their disciplines? Have we moved from provincial institutions training local elites to global institutions recruiting international talent? From the perspective of the student, should it prepare for a professional workforce or prepare for a fulfilling life and a good society? Will it continue to prepare for both? Ideological answers to these questions are rampant and global, not at all confined to Higher Education in the United Kingdom. As we go to press, a new government in the UK has offered détente on the Culture Wars and is attempting to reassure international students that they are again welcome. Yet such assurances arrive without the government committing to budgets for institutions ‘exiting the market’ (Hogan 2024, ‘UKRI plans for “scenario of a university exiting the market”’. Research Professional News/ Research Fortnight 4 September 2024). In October 2024, Fellows of the British Academy organized a private series of panels on ‘Recent Closures and Threats of Closure in the Humanities and Social Sciences: Opening Up’ with the goal of advising ways for universities to economise without losing essential aspects of education for a good society. Some of the presentations are collected here, with this Introduction providing some geopolitical, political economic, and historical contexts. This article is published in the thematic collection ‘On recent closures and threats of closure in the Humanities and Social Sciences’, edited by Regenia Gagnier.
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