Government plans to hike tuition fees to £10,500 by 2029

 Tuition fees could be increased in line with inflation and maintenance grants for the poorest students could be reintroduced, The Times reports. 

It says that Education Secretary Bridget Phillipson has highlighted that the current £9,250-a-year tuition fee has lost value over time and described the system as the 'worst of all worlds'. 

Under the new plans, tuition fees, which have been frozen since 2017, are set to rise by 13.5% over the next five years, reaching £10,500.  

To mitigate the impact on poorer students, maintenance grants, previously worth up to £3,500 before being abolished in 2016, will be reinstated. 

Decision on tuition fee increases 

A Whitehall source told the newspaper there are ongoing discussions among ministers, with any final decision requiring approval from Chancellor Rachel Reeves. 

The source said: "The current system is unsustainable, and we need to raise tuition fees. 

"But at the same time, we need to look at maintenance grants to help those who can least afford it." 

Labour aims to announce these changes before the government spending review in April next year. 

Value of tuition fees 

The value of tuition fees has fallen dramatically since they were last raised to £9,000 in 2012. 

Recent research indicates their value has dipped below £6,000 in 2012 terms.  

In response, universities have increasingly depended on higher-paying international students, particularly from China. 

However, changes to visa rules have led to a drop in applications from countries like India and Nigeria. 

Worried about higher education 

The education secretary Phillipson said that she didn't want tuition fees to rise but was worried about the higher education sector. 

She told LBC: "It's not something that I want to go to, but I do recognise that over time the value of the fee has eroded. 

"It hasn't gone up in a very long time. The system we have got overall is the worst of all worlds." 

She promised 'improvements' by the end of Parliament and that this was a 'highly complex' issue to deliver a fair system. 

Reduce international student numbers 

The Times also points to Universities UK offering to reduce international student numbers in exchange for putting tuition fees up. 

The body's chief executive Vivienne Stern said that raising tuition fees would mean they don't 'go down in real terms'. 

She added that the move needed to be done quickly to 'restore confidence in the system'. 

Ms Stern also said that maintenance loans should also be uprated and doing both together would be 'fairer to students'. 

Overseas students contribute 40% of income 

International students made up 24% of all students at English universities by 2021-22, contributing about 40% of tuition fee income.  

Despite this, around 40% of universities, including prestigious Russell Group institutions, are expected to report deficits for the last academic year.  

York University and Cardiff University have reported deficits of £24 million and £35 million, respectively.  

There are also claims that three institutions are nearing bankruptcy, prompting serious merger discussions. 

Changes to tuition fees and maintenance grants 

The managing director of Accommodation for Students, Simon Thompson, said: "The proposed changes to tuition fees and maintenance grants could significantly impact the student rental market. 

"As universities navigate financial pressures and changing student demographics, landlords must stay informed and adaptable to maintain successful student rental properties." 

He adds: "Student landlords will already be concerned about the potential impact of the Renters’ Rights Bill which will see periodic tenancies being introduced. 

“And now there’s a debate about tuition fees which could put some students off applying for university and the knock-on effect a drop in student numbers would bring.”