Nick Hillman is the Director of the Higher Education Policy Institute, and is a former Special Adviser to David Willetts, then Minister for Universities and Science. This piece is written in a personal capacity.



The media is full of stories saying that the Government will soon confirm EU students in England are to be treated like other foreign students after Brexit. This means the former will have to pay full international fees, not the lower home fees. Plus, they will no longer have access to subsidised tuition fee loans. That is a real double whammy.

Twitter is suitably outraged. The decision will hit our universities, impoverishing them financially and intellectually, and is at one with the Government’s hostile attitude towards students from other countries. Or so it is claimed.

In fact, it’s a lot more complicated than that.

International students, whether they hail from another EU country or from a non-EU country undoubtedly benefit the UK. Typically, they come here, spend lots of money and then go home again, generally with warm thoughts about their host nation. The Higher Education Policy Institute (HEPI), for which I work, has shown just one cohort of international students bringing net benefits of over £20 billion. Every constituency gains.

I have long argued that the Government’s approach to international students is their worst higher education policy. I argued against it inside Whitehall, as Special Adviser to David Willetts during the Coalition. I have argued against it outside Whitehall, too. Since I became Director of HEPI in 2014, our three biggest reports have been on the benefits that international students bring to the UK.

But, despite the real problems with the Government’s general approach to international students, the idea that EU students should come to be treated like other non-British students makes sense.

First, there is the moral case.

While we are in the European Union, there is a defensible logic in having more generous rules for students from fellow EU states. The arrangements are all part of the reciprocity that comes from being in the club. If we are not in the EU, there is no easy way to defend charging richer Germans much less to study here than poorer Indians.

European nations are predominantly white and non-EU international students typically come from countries where white people tend to be in a minority. So maintaining the current rules would be exceptionally hard to defend for other reasons too. (Some people claim it would be illegal as well, but the specifics are murky so lawyers may need to clarify that in due course.)

Secondly, there is the economic case.

Student loans have a cost to British taxpayers because the repayment terms mean much of the money is never repaid. There is a strong case for this for home students. Their families are likely to be contributing to the Exchequer in other ways and they are likely to end up as UK taxpayers themselves. (US states charge less to in-state students for the same reasons.) There is also a logic to subsidising EU students while we remain a member state. But the logic doesn’t so easily apply to residents of anywhere beyond the UK after Brexit.

Remember, the Office for National Statistics are about to reclassify student loan write-off costs as current public spending (rather than a cost that falls far in the future). So the Treasury has to decide whether continuing to subsidise students from other EU countries to study here is a more urgent priority than other public spending needs. Cutting A&E waiting lists, raising school funding, spending more on research or future tax cuts may seem more palatable.

This all brings us, as with so much else, to Margaret Thatcher. When she was a newly-installed Prime Minister, her Government abolished the subsidy that once existed for students coming to study in the UK from outside Europe. Overnight, they became liable for much higher fees.

The higher education sector was united in its outrage. Labour’s Education spokesman, Neil Kinnock, told the Commons:

“It is apparent that the policy has not a single friend. We hear nothing but continual criticisms—some extremely bitter and loud—of the Government’s policy from the Royal Commonwealth Society and the British Council to the Association of Navigation Schools, from the Committee of Vice-Chancellors and Principals of the United Kingdom Universities and the Committee of Directors of Polytechnics to every university, polytechnic and college of higher or further education, every education trade union and every students’ union. Disagreement with the Government’s policy is not limited to those sources. We have also heard criticisms from Conservative students, just as we have heard them, in a courageous and direct form, from Conservative Back Benchers.”

They were all wrong. We can date the UK’s success in attracting people from other countries to study here from that decision. Once universities could charge international students the full economic costs of their education and more, there was an incentive to recruit them. The number of students from other countries started rising fast because, in the words of Derek Bok (a former President of Harvard), universities resemble exiled European royalty and compulsive gamblers in their insatiable appetite for money.

We have calculated that international students who come to the UK now cross-subsidise research by £8,000 each. Without this funding, our higher education sector would be poorer, less good and lower down the global league tables.

I am not saying Brexit is bound to lead to a big growth in EU student arrivals. History doesn’t always repeat itself. The impending changes to the student finance rules for EU students really could put people off coming here to study, even though our universities boast so many strengths and teach in English. Many European countries have fantastic universities of their own and, often, they are free to attend. Research we commissioned concluded Brexit could mean a decline in students from other EU countries of over 50 per cent.

But I am worried that people are opposing the rumoured change to funding for EU students without any sufficiently strong arguments to win the debate. That would be counter-productive because it deflects from the more important task of ensuring the whole post-Brexit migration system makes sense.