The findings recommend combination might end up being an increasingly prominent feature of the higher education landscape, with universities checking out mergers along with digital change tasks, shared procurement plans and strategic alliances to enhance their monetary sustainability.
The study of 48 university finance directors discovered that 81% of institutions are considering digital transformation, 71% are open to shared procurement alternatives and 65% are checking out collaborative structures such as federations and alliances.
While just a small minority have actually already carried out massive structural change, 40% stated they would think about or are actively considering mergers or acquisitions with another institution.
The findings come amidst growing financial pressure throughout the sector and follow 2 major merger statements in recent months. In May, King’s College London and Cranfield University revealed strategies to combine in 2027, while the University of Kent and the University of Greenwich announced a merger last year that will create one of the UK’s largest higher education organizations.
“Universities are grasping the nettle to react to the severe monetary pressures they are facing,” said Vivienne Stern, president of Universities UK.
“Many have had to make considerable cuts, however the survey likewise shows how the sector is discovering imaginative, collaborative services to become more effective and guarantee it can continue to provide the world-class education the UK is understood for,” she included.
Universities are grasping the nettle to react to the serious financial pressures they are facing … however the survey likewise demonstrates how the sector is finding creative, collaborative options to become more efficient
Vivienne Stern, Universities UK
Universities UK said organizations are significantly looking beyond standard cost-cutting measures and towards structural reforms that might provide long-term cost savings.
Nevertheless, the organisation argues that substantial barriers stay, consisting of VAT rules, in advance expenses and a lack of specialist know-how to provide major improvement tasks.
The sector is requiring higher flexibility around barrel and the production of a government-backed change fund to support universities pursuing large-scale cooperation and restructuring.
Despite the growing concentrate on performance, the study suggests lots of organizations continue to rely on cuts to balance their budget plans.
Nearly 4 in 5 universities (79%) have actually carried out voluntary redundancy schemes over the past three years, while the exact same proportion have presented recruitment freezes or hiring stops briefly.
Practically half have actually lowered course arrangement through debt consolidation (46%) or closures (44%), while 31% reported cutting scholastic research activity– more than double the proportion taped in UUK’s 2024 survey.
Trainee support has likewise been impacted. More than a quarter of institutions (27%) have cut bursaries and scholarships, up from 15% in 2025, while 13% have lowered hardship financing.
The financial pressures facing universities reveal little indication of alleviating. According to the survey, 92% of English and Welsh institutions said recent increases to domestic tuition fees would not fully offset the impact of organized policy modifications and increasing expenses.
The most often cited pressures were increases to company National Insurance contributions (79%), changes impacting worldwide student recruitment (67%) and pay and non-pay inflation (65%).
“We are very grateful to the federal government for the difficult decision to uplift costs in line with inflation in England and Wales, but as the survey results show, it simply doesn’t go far enough,” Stern stated.
“Course closures, staff redundancies and reduced research study, which ultimately hit trainees, local economies and nationwide potential customers for development, can not continue to be the only option to the sector’s monetary challenges.”
The findings follow a current report from the Workplace for Trainees, which found that 36% of English college companies remained in deficit in 2015 and alerted that more than four in 10 organizations could face shortfalls in 2025/26.
In early 2025, a sector taskforce was set up– the taskforce on performance and improvement in higher education– in a bid to drive effectiveness and cost-saving throughout universities in England through collective options, including the exploration of mergers and acquisitions.
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