Migration Control at What Cost? The 2025 Immigration White Paper and UK Higher Education

Introduction:

UK universities are facing a sustained financial crisis. At the end of the 2024-25 academic year, nearly a quarter of UK universities had less than 70 days of cash to cover their costs, and the Office for Students reported that approximately 43 per cent of universities were likely to have ended the 2025-26 academic year in deficit. The situation worsened after 2025, when the Home Office tightened laws on immigration.

Background:

On 12 May 2025, the Home Office published its Immigration White Paper, Restoring Control over the Immigration System, which proposed a series of measures intended to guide future immigration controls in the UK. Policies concerning international students were addressed in Chapter 3, “Skilled Workers”.

While acknowledging the benefit international students bring to the British economy, such as their net economic contribution of £37.4 billion in 2021/22, the government is concerned about the unsustainable issuance of student visas by British higher education institutions. According to the Home Office, nearly 50 per cent of all visa-holding asylum seekers are on student visas. The government argues that the timing of some claims may indicate that the student route is being used as a pathway into the asylum system. Moreover, after completing a degree, these students are eligible for a graduate visa, which permitsthem to remain and work in the UK for up to two years.

The Regulated Qualifications Framework (RQF) is used to classify the entry requirements for occupations, categorising qualifications according to their level of difficulty and complexity. For example, RQF 3 includes A-levels or equivalent qualifications, while RQF 6 includes honours degrees or degree apprenticeships. Currently, after graduating, 30 per cent of international students enter non-graduate-level jobs(those classified as RQF 3 and below). Meanwhile, only 30 per cent of graduates are reported to work in occupations classified as RQF 6 and above. The Home Office is therefore concerned about the possibility of irresponsible student recruitment by Higher Education Institutions, as the intention behind the Graduate route is for these students to contribute to the economy by entering graduate level jobs, classified as RQF Level 6 or above.

To address these concerns, the government has outlined the following changes:

1. reducing the Graduate visa from two years to 18 months, and;

2. revising the Basic Compliance Assessment (BCA) metric values.

Shorter graduate visas force international students to seek employment and enter high paying jobs earlier than they otherwise would.

Meanwhile, the BCA metric thresholds are changing for all three core requirements: 

1. the visa refusal rate must be below 5 per cent;

2. the course enrolment rate must be at least 95 per cent, and;

3. the course completion rate must be at least 90 per cent. 

   
   

All three thresholds were increased by five percentage points, forcing Higher Education Institutions to tighten their checks and requirements for applicants. Arguably, this may also lead universities to reduce the number of international students they admit.

Another newly proposed policy in the 2025 white paper is the international student levy, which is a flat fee of £925 per international student per year and will apply to students enrolling from August 2028. Higher Education Institutions will pay this levy to the government, which will reinvest the full sum into higher education.

UK Universities’ Dependence on International Students

The dependence of the UK’s universities on international students is a deep-rooted issue that originated in 1999, when the Prime Minister’s Initiative on International Students was launched to increase the number of international students in the UK and to promote British education.

Since the early 2000s, the number of international students has continued to grow, and the UK has remained the second most popular destination for them. Due to the drastic difference in home and international fees, universities benefit financially from admitting international students.

In the 2024-25 academic year, 23 per cent of the total income and 45 per cent of the total tuition fee income of British universities came from international student fees, but only 24 per cent of the total student population pay international student rates. At some London universities, including LSE, UAL, UCL and Imperial, the international student body exceeds 50 per cent of the total student population, highlighting their importance in the financial sustainability of certain institutions.

Immigration White Paper: Limitations

While the policy paper attempts to address migration-related problems involving international students in the UK, policymakers undermine Higher Education Institutions by abruptly restricting their primary source of funding.

According to section 223 of a House of Commons committee report, the Home Office plays a “preeminent”…“role in the financial health of the higher education sector”. The report highlights the absence of inter-institutional decision-making, as the laws introduced by the Home Office were not coordinated with educational bodies or initiatives such as the International Education Strategy. Consequently, the policies proposed by the Home Office may harm the financial position of UK Higher Education Institutions because of information failure. 

According to written evidence from the University of Glasgow, the shortening of the Graduate visa from two years to 18 months may disincentivise international students from applying to UK universities,placing further pressure on university finances. It may also intensify competition among international graduates in the short term, as they would have less time to secure graduate-level employment. However, if the policy ultimately reduces international student enrolment, it could lead to fewer international graduates competing for entry-level jobs in the longer term.

Overall, the policy is unlikely to lead to an increased number of international students entering occupations classified at RQF Level 6 or above, or to reduce the number of students on visas who seek asylum.Rather, the effect is likely to be an increase in pessimism about finding work and ensuing international talent drain in the UK, as international students seek alternative study destinations such as Canada or Australia, which offer Graduate visas lasting between two and three years. An estimate 14 per cent of students may be deterred from applying for UK student visas due to the reduction in duration of the Graduate visa.

The revised BCA metric values place pressure on institutions to reduce the diversity of their recruitment because of the higher consequences of non-compliance, such as a student failing to complete their degree, or having their visa application rejected. As a result, applicants of certain nationalities may be excluded from recruitment pools. For example, London Metropolitan University and Sunderland University ceased admitting students from Bangladesh, Syria, Iran, Iraq and Yemen.

Arguably, a lack of diversity prevents global talent from entering British universities, reducing the potential economic benefit that such students bring. Moreover, demand for the UK higher education in China, which is the second-largest source of international students, is beginning to decline, due to the increasing prestige of Chinese universities.  This trend is likely to continue, making it vital for the UK to widen itsrecruitment pool. 

The international student levy is predicted to significantly damage Higher Education Institutions. Aston University described the policy as ‘frankly absurd’, claiming it would take “desperately needed” income away from already struggling institutions. According to a university research, it is estimated the levy will cause annual losses of £43 million and £2.3 million for Manchester and Cranfield by 2029-30,respectively.

Universities operate in a highly competitive and price-sensitive market. Therefore, a levy of £925 per student per year may have a substantial adverse effect, potentially resulting in staff losses, course closuresand a decline in the quality of education. Placing additional financial strain on universities is an ineffective decision that may deter research, discourage global talent from entering the UK, and damage the reputation of UK institutions.  

Conclusion

Although the 2025 Immigration White Paper attempts to reduce migration and abuse of the immigration system, it was developed without sufficient coordination with educational institutions that are highly dependent on international students.

The Graduate visa and BCA metric changes are likely to reduce the number of students choosing the UK for higher education, without changing the number of students seeking asylum or increasing the number entering graduate-level jobs. The international student levy is also likely to place additional financial pressure on UK institutions, thereby exacerbating their budget deficits.