Visa changes will impact international enrolments, so UK universities need to prepare for change

Upcoming changes to the UK’s visa rules mean that international postgraduate taught students will no longer be able to bring dependants with them to the UK. This is a significant change for universities and most UK universities will need to adapt their strategies to respond to it.

Students with dependants have become an increasingly important part of the international postgraduate cohort in recent years, swelling the number of dependant visas. This increases the international fee revenue for universities, enhances university diversity, and provides an opportunity for these students to access excellent UK higher education. But adult dependants also gain access to the UK workforce, which is not necessarily consistent with the government’s priorities around immigration.

According to the Home Secretary, these changes seek to strike “the right balance between acting decisively on tackling net migration and protecting the economic benefits that students can bring to the UK”.

However, this policy shift adds to the threats that UK universities already face: flat home undergraduate fees that no longer cover the cost of teaching, rising costs fuelled by the war in Ukraine and post-COVID supply chain challenges, long-running industrial disputes, and the Office for Students’ push to reduce reliance on Chinese students.

The government’s most recent changes to dependant visa rules will increase financial pressure for many universities, with those reliant on Nigerian, Indian and Pakistani postgraduate taught students being the most affected.

In this article, we seek explore the impact the changes will have on UK universities and offer some ideas on actions universities should take to prepare for the change.

The government’s changes respond to the substantial increase in both student and dependant visas.

COVID provided a break in the data and reduced student numbers in 2020. But the bigger story is the introduction of graduate visas, also known as post-study work visas, for students who started their studies in academic year 2020/21. Graduate visas let students who graduate from a UK university remain in the country for a further two years (or three years for PhD graduates). For international students who want to both work and study outside their home country, this has made the UK much more appealing.

Some exploration of this trend is useful.

Students themselves have limited work rights during their studies. This is consistent with the fact study is the primary purpose of their time in the UK. But dependant visa-holders have (nearly) unconstrained work rights. This lets adult dependants continue their careers and support their family while the main applicant completes their studies. These work rights continue for dependants when the graduate is on a graduate work visa.

So for a couple, a one-year master’s degree can give the student one year of part-time work rights and two years of full-time work rights, while their partner gets three years of full-time work rights. This allows couples (who might not otherwise have a pathway to work rights in the UK) a cumulative six years of UK work rights.

While this explains a potential economic driver, we must not forget the human driver. Very few students with families will want to leave them in their home country when they move to the UK to study.

Universities have benefited from the combination of dependant visas and graduate visas – gaining student fees and a more diverse student cohort. But they are not active participants in this process of bringing in dependants. Universities accept students on their merits, without knowing whether they intend to bring family with them to the UK. Students decide whether they want to bring dependants with them for their studies.

While international students and dependants have no recourse to public funds and pay the NHS surcharge, de facto student control of the number of dependants entering the UK has made it harder for universities to plan appropriate services and to ensure the right housing and community supports are in place to support dependants who come.

This removal of dependant visas for postgraduate students structurally reduces the UK’s appeal as a study destination for some types of international students. Many factors influence international students’ decisions about where and what to study. We can summarise these as the Five Es.

These visa changes primarily affect emigration and expense. Dependants can currently work for the study year and the two years beyond. This will no longer be possible without them applying independently. This requires sponsorship for most and is not easy. This has an obvious emigration impact. But expense is also important. The UK has higher salaries than many other countries and a partner who remains in the student’s home country cannot use higher UK salaries to defray the high cost of the student’s international education in the UK.

So these changes will make the UK less appealing for prospective international students with dependants compared to other major study destinations such as Canada or Australia.

This change will not affect all universities equally. Nigeria and India together accounted for three quarters of student dependant visas issued in 2022, with Pakistan, Bangladesh and Sri Lanka comprising much of the remaining quarter. Notably, Chinese students bring very few dependants, despite China being the largest source country for international students for the past decade. This is a further reminder that there is not another China when it comes to international student flows and that universities need to adapt to meet the needs of the international student mix.

The average number of dependants per student varies substantially across countries. At one extreme, the average Libyan student brings 2.07 dependants. Nigerian and Sri Lankan students are also highly likely to bring dependants – 1.04 and 0.92 dependants per student respectively. Pakistani and Indian students cluster together with 0.29 and 0.28 dependants per student. China is an outlier, with 0.006 dependants per student. To put this another way, for every Chinese dependant, there are 173 students, while in the case of Nigeria there are more Nigerian dependants than students.

The most affected countries are those with many postgraduate taught students and a large proportion of students bringing dependants. So China, despite being a major market, will not face major challenges from policy change. Equally, Libya, despite there being twice as many dependants as students, is not significant as it is not a large market. The largest absolute reduction in student numbers is likely to come from substantial source countries where many students bring dependants. So universities with large taught postgraduate student cohorts from Nigeria, India, Pakistan, Bangladesh and Sri Lanka are likely to be the worst affected.

But absolute numbers would only tell part of the story. We need to contextualise this based on the scale of the impact relative to the university and the types of international students that each university student attracts from these countries.

The proportion of international postgraduate taught students from the top five affected countries helps us to understand the intensity of the challenge for individual universities and for the sector as a whole. This is because international students often generate a surplus for universities to re-invest in capital works, provide home undergraduate teaching, and undertake research.

Based on this metric, five universities attract more than 90 per cent of their international PGT students from the top five higher-risk markets. A further 26 universities attract more than 80 per cent from these markets. Further nuance on a university-by-university level relies on an understanding of cost-to-attract and cost-to-teach that goes beyond what is publicly available.

The challenge is significant for many universities. Of course, university-specific factors will also be an essential part of university planning so even least-affected universities should review the impact of these changes. But universities with a high enrolment from the most affected countries will benefit from a more substantial review of their financial position and service provision.

Universities continue to prove themselves resilient in a challenging and changeable environment. And these changes to the dependant rules will force new decisions. While universities are well equipped to respond to them, they can explore several options:

• All universities will benefit from re-developing their enrolment projections to account for a different international cohort. This can feed into strategic decisions about where to focus recruitment attention and how to provide the best student experience for those who come.
• UK universities can adapt their international strategies to focus their limited marketing, agent networks and leadership engagement on the countries that can best support recruitment.
• Affected universities can review their pricing and scholarships strategies to account for a structurally different appeal for international higher education in the UK – this may include more targeted international postgraduate teaching scholarship development.
• Transnational and online education can reach students with families who can no longer bring their families with them to the UK. However, this will only be appropriate for some universities in some markets.
• Many UK universities will need to reimagine their operating models to sustainably reduce their cost base in an environment with fewer international students and higher costs. Size and shape models can help chart potential paths forward.

University-specific factors will inform the number of students that universities will not attract following these changes. But all universities should be thinking carefully about what it means for their institution.

Get in touch to explore the likely impact on your university and the best ways to respond.

Prepared with input from Julie Mercer and Abigail Dempster.

Connect with Nic Dillon on LinkedIn.