Newcastle University faces £35m blackhole as international student numbers decline
International student numbers went down by 17% in latest figures
Newcastle University is expecting a £35m drop in income this year due to a decline in the number of international students attending.
According to an email to staff from the university’s vice-chancellor, Professor Chris Day, a £35m shortfall is expected in the coffers this academic year due to challenges in recruiting international students. Newcastle University had already built in £15m of “mitigations” in its annual budget but must now find an additional £20m in savings to avoid a financial deficit.
In the email, seen by the Local Democracy Reporting Service, Prof Day said: “…our aim is to protect core education and research while acknowledging that immediate cost controls will require difficult choices and prioritisation”.
According to the email, Newcastle Univerisity’s Executive Board has agreed to freeze recruitment to all new and replacement “core funded” posts until further notice. Exceptional cases will be considered if they are considered “business critical”.
In addition, all “capital projects”, including buildings or equipment, will be reviewed to consider the risks of pausing work or purchases against the costs of completing them, New restrictions on any such new spending will also come into effect.
The University will also freeze changes to existing contracts, including requests for longer working hours. This is also subject to “business critical” exceptions. It is also expected that the majority of the University’s “payment cards” will likely be withdrawn and suspended.
Reviews are under way on the implementation date of the national pay award, alongside academic promotions and annual pay reviews for all staff. Travel both inside and outside of the UK is also restricted unless it can be funded from elsewhere or deemed essential to business.
A Newcastle University spokesperson said: “We are in a sound financial position but like many other universities, we are managing the impact of a shortfall in international student recruitment this year resulting in a fall in income.
“We are implementing cost-control measures which will allow us to protect our core business and strengthen our financial resilience.”
According to Home Office figures, student visa applications between January and August this year, 278,700, were 17% lower than in January to August 2023. This follows government changes in January 2024 meaning most students are no longer allowed to bring dependents with them.
In February this year, Northumbria University announced it would slash its staffing budget by £12.5m. A move which the University claimed was also attributed to difficulty with international recruitment as well as higher than normal energy prices.
The budget cut was dubbed a “crisis” by the university’s chapter of the University and College Union. The fall in international student applications was estimated to cost the university £10m in lost income.