Welsh universities ‘in danger of crumbling’ without swift action, Senedd told

Cardiff University’s Wales Governance Centre has predicted that Welsh universities could lose up to £140m in fee income

Universities are “pillars of the Welsh economy” but are in danger of “crumbling” due to Covid-19, a member of the Senedd has said.

Plaid Cymru’s shadow economy minister Helen Mary Jones has urged the Welsh government to take “swift action” to prevent severe financial damage to Welsh higher education providers.

The comments came as Welsh education secretary Kirsty Williams published a ‘Resilience Plan for post-16 education in Wales in the wake of Covid-19. The plan says the Welsh Government will work with organisations in the post-16 sector to support learners and practitioners, and to review various existing processes – but Ms Jones says more is needed.

If the UK Government won’t step in, then the Welsh Government must

“We agree with the Welsh government that this current crisis is an economic emergency as well as a public health one,” she said.

“The current measures outlined by Welsh Government, by their own admission, won’t be enough to secure our HE sector.

“Our Welsh Universities are a pillar of our economic structure and a lack of swift action by Welsh Government will mean that this pillar is in danger of crumbling.

“I’ve said before that this threat is about as big as it gets and therefore we believe that if the UK Government won’t step in, then the Welsh Government must.”

Financial blow to Welsh universities

A week ago, analysis by Cardiff University’s Wales Governance Centre revealed that, due to the Covid-19 pandemic, Welsh universities could lose anything between £100m and £140m in 2020-21 from fee income alone.

It showed that tuition fees accounted for £892 million, or 54.7% of universities’ income, in Wales, compared to 50.2% across the UK.

The report’s author Cian Siôn, a researcher on the Wales Fiscal Analysis programme, said: “Pressures on student recruitment as a result of the Covid-19 pandemic represent a serious financial threat to the Higher Education sector in Wales.

“Several surveys point to a sharp drop in international and home student enrolment in September.

“Welsh institutions were already in a relatively weaker financial position before the crisis, so this is a blow that will be felt more acutely here.”

The report also reveals the sector provides 17,300 full-time Welsh jobs, contributes 4.8% of Gross Value Added (GVA) and accounts for 32.5% of the country’s Research & Development (R&D) spending.

It points out that while the UK government’s bailout measures may address an immediate shortfall in funding, the effects of a smaller student intake in September will be long-lasting, leading to job losses and a shrinking of the sector in Wales.

A drop in international student recruitment will hit Cardiff University, Cardiff Metropolitan University and Bangor University hardest, according to the analysis, while Glyndŵr University, University of Wales Trinity Saint David and Cardiff Metropolitan University stand to lose the most from a drop in domestic students.

Cian Siôn added: “We hope that these findings clarify the importance of the Higher Education sector to the Welsh economy and that without some kind of tailored support package, there may be a serious financial threat to most universities in Wales.”

Devolved governments and the UK

Universities Wales responded to the Wales Governance Centre analysis by pointing out that “universities are proportionately more important to the economy of Wales than elsewhere in the UK […] and any significant shrinking of the sector would have knock-on impacts for jobs, regional economics, local communities and students.”

It added: “Wales’ universities are also making important contributions to support the national effort in response to Covid-19, and will have a vital role to play in the Wales’ recovery from this crisis.

“Welsh Government and UK Government must take urgent action to provide support to ensure universities are able to weather these very serious challenges, and to protect students, maintain research, and retain our capacity to drive the recovery of the economy and communities.

“Universities Wales has recently worked with Universities UK supporting the development of UUK’s balanced package of proposals to mitigate these challenges and ensure the sector is able to play a key role in the UK’s recovery.

“The UK Government’s initial response to these proposals, published on 4 May 2020, must be a first step towards a full package of support developed by the UK and devolved governments to address the challenges faced by the sector.”

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