Overseas students 'to increase in UK universities'

The number of overseas students in UK universities will rise by a further 10% this decade, says a study for the British Council.

Only Australia is set to have a bigger increase in overseas students.

It forecasts that India rather than China will send the most students in this lucrative global market.

Jo Beall, the British Council director of education, says the "next 10 years will be critical" if the UK is to take advantage.

Speaking ahead of the British Council's Going Global conference, Dr Beall says there is a "decade of opportunity" for the UK to benefit from an increasingly-mobile international student population.

Shifting power
"In an increasingly connected and inter-dependent world, a willingness and ability to collaborate internationally and to respond to changing trends are vital," said Dr Beall.

By the end of the last decade there were 3.5m students studying overseas - and even though the rate of increase will slow, the overall number is expected to continue to rise.

Setting out global trends in higher education until 2020, the British Council study forecasts an increasing importance for Asian countries, challenging the longstanding domination of the United States.

By 2020, China will have almost twice as many students as the United States.

But the British Council predicts that it will be India rather than China that will be key player for sending students overseas.

Figures from the Higher Education Statistics Agency show that currently China is by the far the biggest provider of overseas students to the UK -with 67,000 students in the UK, compared with 39,000 from India.

The figures from 2011 show that about 12% of students at UK universities are from overseas - which is categorised as being outside the European Union.

In terms of the potential market for higher education, the British Council highlights that by 2020, just four countries will account for more than half of the world's 18 to 22 year olds - India, China, the United States and Indonesia.

The British Council says that the biggest single expansion in overseas students is likely to be Australia, which it predicts will be teaching an extra 50,000 by 2020.

But it says that the UK could be the second-biggest in terms of increasing overseas student numbers, predicting a rise of 30,000.

The British Council also highlights how university research has become internationalised - with more than a third of research now involving international collaborations.

The forecasts are issued in advance of this week's Going Global conference in London, examining university globalisation, which will bring together 1,300 higher education leaders from around the world.

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Universities say students may face earlier loan payback

Graduates could pay higher interest rates on their student loans and pay them back earlier to help avert a funding crisis, a report says.

The Russell Group of top universities says it faces a £1.1bn black-hole in its finances by 2012-13.

The claims are in its submission to England's official review of student finance and fees.

The National Union of Students said students already paid "more than their fair share".

President-elect Aaron Porter said: "These are elite universities that are simply turning around to students saying they have to foot the bill for cuts in government funding - but they should have anticipated this and thought about their provision".

The Russell Group represents the 20 most research-intensive universities in the UK, and includes the likes of Oxford, Cambridge and University College London.

It says that without extra income its members will be forced to make significant cut-backs.

The group has suggested the £900m-worth of cuts planned by the Labour government for the next three years would bring the UK's higher education sector to its knees.

But it kept its submission to the independent review of higher education funding and student finance secret until now.

The review will report to the government in the autumn.

Under-investment
Although this submission stops short of suggesting higher tuition fees for UK students, it appears to indicate that other solutions may not be fully workable.

It also argues that one way to make the student finance system more sustainable would be to charge students a real rate of interest on their loans.

This could be linked to the cost of government's overall cost of borrowing. It also suggests the threshold at which students start paying loans back could be lowered from the present £15,000.

The Russell Group says: "The lack of a real rate of interest on student loans" is a "subsidy which imposes high costs on the Government, and which exceeds the requirements of ensuring fair access to higher education".

It is set to make a number of submissions to the review in the next few weeks.

The group says variable tuition fees have enabled top universities to maintain high standards and widen access.

Future cuts
This funding, together with the package of loans covering the fees - now at £3,225 a year - has allowed many more students to attend universities, it says.

It adds that much of the increased funding has been used by universities to compensate for a backlog of under-investment.

But it also claims the financial sustainability of the sector as a whole is severely at risk, with universities facing rising cost pressures, particularly related to salaries and pensions.

It says research intensive universities face particular pressures because of low staff-student ratios and high equipment and resource costs.

One Russell Group university loses an estimated £3,620 per chemistry student per year, it adds.

And figures like this lead the group to predict top universities will be £1.1bn in the red by 2012-13.

Russell Group director general Wendy Piatt said: "With funding reductions and the prospect of future cuts to manage, without clear means of increasing their income, meeting these challenges begins to look like an impossible task.

"There is now a real risk that we could lose academics who have been responsible for discoveries that have changed the lives of millions of people for the better."

Knowledge economy
The report says there are only three ways in which universities could reduce their annual deficits.

These are reducing costs by cutting staff; increasing income by recruiting more overseas students; or increasing income through domestic tuition fees.

It also suggests that graduates could pay back their loans earlier and at a higher interest rate.

Under the current system, students begin to pay back their loans when they start earning £15,000 a year or more, and at a low interest rate.

The public costs of funding the student finance system could be reduced by lowering the threshold at which graduates begin paying back loans, it adds.

A spokesman for the review of fees said it would consider the submission along with all the others. The Department for Business, Innovation and Skills said it would respond to the review when it reported in full.

University and College Union general secretary Sally Hunt said: "We desperately need to overhaul how universities are funded and move away from the idea that the current review of student funding is merely a question of how much student fees go up by."

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