Tuition fees in England are set to increase for the first time in eight years due to financial pressures on universities. Starting in September 2025, the cost of an undergraduate degree will rise from £9,250 to £9,535 per year. This change comes alongside an increase in the maximum maintenance loan available for students living away from home, which will rise from £10,227 to £10,544 for those outside London.
Warnings about the financial state of universities have intensified. According to Universities UK, which represents 141 institutions, there is a strong recommendation for tuition fees to be set at £12,500 annually to adequately cover teaching costs. With inflation eroding the value of existing tuition fees and a decline in international student enrollment, many universities are facing budget cuts that could impact staffing and course offerings.
The Office for Students, England’s education regulator, reported that 40% of universities expect a deficit this academic year. Despite these concerns, the government has advised universities to “manage their budgets.”
The financial burden on students extends beyond tuition fees. Recent data indicates that average annual rent for students has surged from £6,520 in 2021-22 to £7,475 in 2023-24. Notably, cities like Bristol and Nottingham have average rents of approximately £9,200 and £8,427, respectively.
According to research by the Higher Education Policy Institute (Hepi), maintenance loans barely cover rental costs. Without additional support from family or part-time employment, students may struggle to meet their basic living expenses after housing costs.
“Students will have no money to live off after paying housing costs,” warns Hepi.
Students also face other significant expenses such as food and transport. A survey conducted by UCAS revealed that students spent an average of £219 per week as of late 2022.
Most UK students can apply for a tuition fee loan alongside means-tested maintenance loans based on family income. The recent changes in repayment rules mean students may end up paying more over time compared to earlier graduates.
Research indicates that while graduates generally earn more than non-graduates, the additional income has been declining. For instance, the average salary for graduates 15 months post-degree was reported at £29,699 according to HESA data.
In conclusion, while pursuing higher education can provide opportunities for increased earnings and social mobility—especially for those from disadvantaged backgrounds—the rising costs associated with tuition and living expenses pose significant challenges for many prospective students.
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