THE University of Liverpool is growing fast. Since 2011 it has invested nearly £250m ($360m) in new student accommodation, across three different sites, to house 4,500 students. “We have seen a dramatic increase in interest over the past couple of years,” says Gavin Brown, a university official. That it has been able to respond to the increased demand is partly due to an unheralded reform of student admissions.

In 2012 restrictions on the number of students that universities were allowed to recruit (in place to control government spending) were relaxed in England to allow them to accept as many students with good grades at A-level, the exams taken at 18, as they wished. The following year George Osborne, the chancellor, surprised universities by going further, declaring that from 2015 the limit on the number of students they were allowed to recruit would be lifted entirely.

The government hoped the change would enable universities to expand, creating more skilled workers and widening access to higher education. Another effect would be to increase competition between universities for students—a process encouraged by the trebling of tuition fees to a maximum of £9,000 in 2012, which means more funding now follows students. “It was a much bigger shift than many people in higher education initially realised,” says Nick Hillman, a former government adviser who now runs the Higher Education Policy Institute, a think-tank.

A demographic dip in the number of 18- to 24-year-olds, an improving job market and a sluggish response from some universities mean that student numbers are yet to grow much, and are unlikely to do so for the next few years. Nevertheless, many universities are changing their approach to admissions. Early signs suggest that growth is concentrated in older, research-focused universities. In 2015 the English members of the prestigious Russell Group of universities accepted 6.7% more students than in the previous year. Meanwhile, acceptances by the English members of the Million+ group of newer, less fancy universities fell by 0.6%.

This cannot be explained solely by the lifting of the cap. Some low-ranked universities have chosen to focus on increasing the academic ability rather than the number of students they take in. Many high-ranked universities have benefited from being able to expand under the earlier, partial lifting of the cap; others, including Oxford and Cambridge, have chosen not to take on more students. But it may also show that stronger institutions—new as well as old—are growing at the expense of weaker ones, says Emran Mian, director of the Social Market Foundation, a think-tank. Indeed, many successful new universities, including Coventry and Manchester Metropolitan, are expanding faster than older establishments.

Although universities can compete on price, students have shown little sign of favouring institutions with lower fees (which partly explains why these days most charge the maximum). As a result, universities must now compete on quality, says Chris Husbands, vice-chancellor of Sheffield Hallam University. Some reckon that the higher-education market will diversify, with more institutions concentrating on niche or work-focused courses in order to attract students.

A few universities will suffer at first. The question is whether the pain will be worth it in the long term, says Andy Westwood of Manchester University. Critics of the uncapping policy argue that some low- and mid-ranked universities are being punished unfairly by students’ preference for institutions that look good on a CV, rather than those with the best lecturers. Others complain that uncertainty over student numbers makes long-term planning hard.

But much of the angst will be forgotten if student numbers begin to grow more quickly. When a similar cap was lifted in Australia in 2012, the proportion of youngsters going to university increased in every social group. Demographic trends mean the number of British 18- to 24-year-olds will pick up in the early 2020s. And all universities will benefit from more EU students: some 14% more were accepted this academic year than last.

But funding the extra places will not be cheap: the policy will require the support of future governments. Unfortunately for those universities that are hoping to expand, that is far from guaranteed.