The Koala News column
Britain goes to the students
Visas, money and the offshore pivot: a dispatch from inside the UK system, for readers who will recognise the plot.
Tayyeb Shah | October 2026
In September, more than 7,300 international education professionals from 106 countries came to Glasgow for the EAIE's annual conference: the people who run international offices, the academics who build partnerships and teach across borders, and the companies that support both. I was there in my association role, but this column is written with my other hat on: twenty-odd years in and around universities, most of them British, three with the University of Western Australia, and these days advising universities in both countries.
The programme in Glasgow was good. The corridors were better. Three conversations kept coming back, and the weeks since have only sharpened them.
Visas
The first was visas. The UK has spent two years tightening the student route, and the sector is living with the result. Dependants have largely gone from the taught postgraduate route. Agents are telling universities plainly that Britain has become a harder sell.
The scale is now official: sponsored study visa grants are down 41 per cent from their 2023 peak on the Home Office's figures, with Indian grants down 16 per cent in the latest year alone. The September intake looks worse still, with visa refusals up by more than 40 per cent on last year across the dozens of universities whose processing runs through the Enroly platform.
Since June, sponsors have had to keep refusal rates below five per cent, and some universities are withdrawing offers rather than risk their licence: on the Financial Times' analysis, 10.5 per cent of UK study applications were withdrawn in the first half of 2026, against 2.3 per cent a year earlier. Around 15 universities are reported to have suspended recruitment from Pakistan entirely. No minister has said those students are unwelcome; no minister needs to. Pakistani grants fell 47 per cent in a year, with refusal rates running at roughly four times the all-nationality average: the compliance arithmetic does the excluding. Nigeria shows the mechanism at its starkest: acceptances up on the year, sponsorship certificates down 44 per cent - universities saying yes to students and then not daring to sponsor them.
The risk is not theoretical. At the end of September the Home Office suspended Buckinghamshire New University's student sponsor licence; the university has cancelled its January intake while it makes its case. Whatever the outcome, the signal to every vice-chancellor was unmistakable.
Australians will recognise the shape of this story; you wrote it first, when Ministerial Direction 107 turned the processing queue into a quiet instrument of selection. The difference is that the UK has no Ministerial Direction to point at. This is policy working as intended.
Money
The second was money. The regulator's May update forecast more than four in ten English universities in deficit in 2025-26, and the Office for Students itself calls the sector's recovery assumptions overly optimistic. The domestic fee has only just been unfrozen after nearly a decade and still sits far below cost: on the government's own commissioned study, universities lose roughly £3,000 a year on every home undergraduate they teach.
International fee income is the cross-subsidy that makes the system work - the sector's single largest surplus-generating activity, quietly underwriting both loss-making home teaching and world-class research - and the government now proposes to tax it: a £925 levy per international student per year from 2028, which has vice-chancellors in open revolt - Durham's called it "absolute insanity". As the cross-subsidy falls away, the adjustment arrives as restructures, course closures and job losses on a scale the UK has not seen. Portsmouth, which launched a formal reset after a £22 million shortfall in overseas fee income and has put hundreds of posts at risk, is one example among many.
The storm has been cumulative. Brexit ended home fees for EU students, whose new entrants more than halved almost overnight; the Irish, still treated as domestic under arrangements older than the EU, are the one growth story. Then the visa squeeze hit everyone else. And as international seats emptied, higher-ranked universities widened their nets to fill them with home students, accepting lower grades and fishing in the recruitment ponds of those below: the Russell Group's share of enrolments reached a record 29 per cent last year while intakes fell by as much as a third at some institutions further down the ladder. The think tank HEPI has a name for it: predatory recruitment. The pain cascades downward.
When the music slowed, the sector reached for its own version of too big to fail: universities are often their city's largest employer, and surely no government would let one go. Scotland has tested the theory. Dundee has been bailed out twice, £62 million committed across two packages, and in October was refused a further instalment after the funding council judged its cash balance too healthy to qualify. England's regulator has answered the theory in advance: it will not bail anyone out - a doctrine set in terms by its first chair and never withdrawn - and its message this year to those with thinning forecasts is that short-term fixes will not be enough. The boom years left their monuments, buildings by star architects and executive pay that rose with them, and the bill has arrived.
Fewer, bigger, differently shaped
Consolidation has begun. Call them mergers if you like; let us be frank, rescue is often the truer word. Greenwich's combination with Kent, completed in August, followed a reported £31 million deficit at Kent and union warnings of insolvency. City's 2024 merger with St George's folded a specialist medical school into a comprehensive in search of scale and resilience. And the consolidation reaches well up the league tables: King's College London and Cranfield, the postgraduate defence and aerospace specialist, announced in May that they will merge in 2027, with Cranfield absorbed into King's. Note the mix: City St George's and King's-Cranfield fold specialists into comprehensives, while Greenwich-Kent joined two comprehensives, one of them in distress. And note the shape of that last one: Greenwich and Kent did not fold into a single university but built a group: one governing body, two preserved brands, each still awarding its own degrees. They offer it as a blueprint for others to follow. England's schools have spent two decades consolidating this way, into multi-academy trusts; higher education has just built its first, and it will not be the last: two in five universities told Universities UK in May that they would consider trust-style groupings or mergers.
A third shape has appeared: private acquisition. In August, Lincoln Bishop University - Bishop Grosseteste as was - announced it is being taken over by the private group Global University Systems, subject to regulatory approval, and The Times has reported the University of Buckingham exploring a sale to the same group. The question of who may own a British university has quietly reopened. Watch the tertiary variant too: London South Bank already runs an integrated group spanning a university, colleges and academies - the dual-sector model Australians know from Swinburne or RMIT, arriving from the other direction. And expect comprehensives to become less comprehensive: departments closed, disciplines merged, portfolios concentrated where an institution can actually compete. Much of this is three decades of liberalisation coming home. The 1992 Act turned the polytechnics into universities; the cap on domestic numbers went in 2015; and international fee income funded the dreaming while the sun shone. The UK has too many universities trying to be comprehensive, and a rebalancing is now under way whether the sector plans it or not.
Australian readers need no translation. In Perth, a steering committee is now examining whether my old institution, UWA, should combine with Curtin and Murdoch into Australia's largest university, and staff have already marched on Parliament House. The driver there is different: state ambition rather than distress, with Adelaide's half-billion-dollar merger as the template. But the direction of travel is the same: fewer, bigger universities.
The TNE pivot
The third conversation in those Glasgow corridors was the pivot to transnational education (TNE). Here the UK has crossed a line worth marking: in 2024-25, on UUKi's count of the official data, the UK taught 699,660 students overseas and hosted 681,430 international students at home. Offshore now outweighs onshore. If students cannot come to Britain, Britain goes to the students.
Offshore now outweighs onshore
None of this is accidental. The International Education Strategy relaunched at King's College London in January sets a £40 billion export target for 2030 and, pointedly, no student-number target - its 2019 predecessor's 600,000 onshore goal having been met almost a decade early. Exports, not arrivals, are now the policy.
India is the visible front: a wave of branch campuses under the UGC's foreign-provider rules, with Southampton, first through the door in Gurugram, enrolling around 120 students in its opening year and welcoming its second cohort in September. China is the quieter revival: in May, Beijing approved 219 new foreign partnerships in a single batch, and the UK was the leading partner country with 49, including 16 joint institutes - regional institutions alongside the usual names. And inside Britain itself, regional universities keep opening London campuses to catch international demand that will not travel north; Hull opened a full campus at the Olympic Park in July, after its private-partner study centre enrolled 1,700 students in two years.
But keep the modes in proportion. Branch campuses are the headlines, and they are 46,385 students of the 699,660. Partnership provision, meaning franchised and validated courses delivered with local partners, carries seven in ten UK TNE students, with distance learning most of the rest. And the economics differ. A branch campus is slow money. Break-even can be declared early, flattered by costs the home campus quietly absorbs; a decent financial return typically takes seven to ten years, which is why I tell clients the returns belong to your successor's successor. Franchising and validation pay back far sooner, which is precisely why they grew so fast, at home and abroad. The income, mind, is thin. On the first official count, English universities' net TNE income works out at little over £1,200 a student, against an average onshore international fee of about £18,000. The comparison is imperfect (net against gross, and margins vary wildly by mode), but every chief financial officer I know says the same thing: it takes many TNE students to replace one onshore enrolment. Coventry is the cautionary proof. It built one of the sector's biggest TNE networks - more than 70 partner institutions teaching over 21,000 students abroad, with campuses from Poland to Kazakhstan - yet is two years into deficit and fighting its way back to break even: even a global TNE footprint cannot, on today's margins, carry an institution.
Branch campuses are the headlines, not the bulk
The fast growth of franchised and validated provision is also why the regulator has moved, though so far only at home: from this year, English universities must account formally for their domestic franchised provision, and larger franchise colleges are being brought onto the register, with the funding consequences arriving from 2028-29. Offshore, the touch is lighter: oversight rests on the regulator's general conditions and a voluntary quality scheme, with no authorisation regime at all. Here the two systems have swapped scripts. Australia pushes TNE while erecting a toll booth: TEQSA authorisation, a fee of A$36,800, an assessment queue measured in months. The UK pushes TNE with no toll booth whatsoever. My crystal ball says that will not last. A country whose offshore enrolment has just overtaken its onshore intake will, sooner or later, send a regulator after it.
The traffic turns
One more thing to watch: the traffic is no longer one way. Arizona State University has launched ASU London, a UK-registered institution with its own degree-awarding powers, sharing a campus with City St George's from this autumn; it is built on the bones of TEDI-London, the engineering school ASU founded at Canada Water with King's College London and UNSW. Peking University's HSBC Business School has taught from Boars Hill, outside Oxford, since 2018 - a Chinese state university on British soil, with plans to expand. SP Jain, the business school with campuses from Mumbai and Singapore to Dubai and Sydney, now teaches more than 200 students in Canary Wharf. Foreign universities awarding degrees in Britain is a small trend with room to run - and a mirror worth holding up to every system that assumes TNE only flows outward. The mirror has numbers: on C-BERT's latest count, Indian universities now run 19 campuses abroad and Chinese universities 13. A question for your side of the world: which Australian university will be the first to set up in Britain in its own right? It no longer sounds far-fetched.
What it means for you
What does this mean for Australian readers? Competition for the same students intensifies, because a Britain screened out of its riskier markets redirects effort into the safest ones: UEA's deputy vice-chancellor told the Financial Times the squeeze is pushing universities to "double down on China and India" - the two markets Australia leans on most. Expect the next phase to be pipelines: TNE years abroad articulating into a final year onshore, a three-plus-one that a nervous government may find easier to bless than direct recruitment. That is a prediction, not a report. The pain, meanwhile, is not evenly spread: the global names are the least exposed to the markets now being screened out, and the squeeze lands hardest on those, in London and beyond, that recruited most heavily from them.
Partnership opportunity widens, because institutions under pressure are more open to structural collaboration with those who have run the TNE playbook longer and, mostly, better. The proof already exists: Deakin and Lancaster opened the first UK-Australian joint campus in Bandung last year.
And there is a warning for both of us. Social licence used to be an Australian phrase; this year the president of Universities UK adopted it, telling the sector the licence cannot be taken for granted. In Britain the pressure arrives as net-migration arithmetic and headlines about housing and jobs, but the underlying fact is the same on both sides of the earth: the public consent that underwrote the boom has thinned, and this is what happens when a system built on international cross-subsidy meets a government that has stopped believing in it. The cycle will turn. It always does. Not every institution will still be standing when it does.
A version of this column first appeared in The Koala News. Republished with permission.
Earlier writing: The UK's new internationalisation strategy, EAIE blog, May 2019. Read
