Immigration white paper impacts on the Higher Education sector and international students

The immigration white paper contains broad changes affecting swathes of UK immigration policy, including workers, students, family, settlement, citizenship and asylum. Here I look at the changes affecting higher education and the student’s journey.

Why they are making changes

The government is concerned about certain recent trends in student migration. These include a general rise in numbers of international students (especially a 49% increase for lower ranked institutions and a 7% fall for institutions ranked in the Top 100) and increases in the number staying the UK on other routes following the end of their visas (more than half between 2022 and 2024 compared with less than a fifth in 2019 and 2020). Recent changes preventing students from bringing dependants have already resulted in a 14% drop in numbers.

Another concern is the alleged misuse and exploitation of student visas as an entry point for living and working in the UK where the individual has no real intention of completing their course. Steps were already taken to address this in August 2023 requiring students to finish their course (or complete two years of a PhD course) before they could switch to another route. However, the current stated concern is regular migrants such as students claiming asylum (47% of claims from visa holders are made by students). 

The government appears to consider a person who is here as a regular migrant and later claims asylum must, by default, have been gaming the system. It does not consider that a person who may have a genuine case for asylum may still prefer to pursue regular immigration options allowing them stronger rights to live, study and work in the UK, only using asylum when regular options are no longer possible as a last resort in order to avoid returning to face persecution.

The government now plans to increase burdens on sponsoring education institutions while reducing the duration of the graduate visa, alongside measures addressing asylum policy, in the hope that this cuts net migration. They estimate that the graduate visa changes will result in a yearly 3.5% reduction of approximately 12,000 students, a new higher education tuition levy could reduce numbers by around 7,000 annually (but with higher impact in the short-term of around 14,000 students) and changes to sponsor compliance could result in 12,000 fewer students.

The danger is that these proposals risk harming the higher education sector and the wider economy.  International students contributed approximately £20.65 billion to the economy in living expenses and tuition fees, which will fall if student numbers fall. Meanwhile, higher education institutions are reliant on the higher tuition fees of overseas students to subsidise courses for domestic students – if numbers of international students fall, this will have an impact on domestic students. 

When the Migration Advisory Committee (MAC) conducted a rapid review of the graduate route in 2024, the Chair made clear that

any policy change to the Graduate route intended to reduce student numbers would need to explain how the financial consequences for the sector would be addressed. We repeat the observation that we made in our last Annual Report that the government needs to consider the total impact of a policy change rather than simply its effect on net migration.

This does not appear to have been considered in this white paper.

Changes for sponsors

The white paper proposes a number of policies affecting student sponsors. The first is to introduce a levy on tuition fees. So, as well as reducing the income for education institutions by cutting numbers of international students, the government plans to take a cut of the money that they are still bringing in. 

The levy rate is not confirmed but the rate used in the white paper for illustrative purposes is 6%, estimated in the technical annex to the white paper to lead to a 2.4% fall in international student numbers in the long run if the cost of this levy is passed on to students. Further details are expected in the Autumn Budget.

Sponsors are also to face higher compliance burdens. Currently a sponsor will fail its Basic Compliance Assessment if it misses targets on visa refusal rates (<10%), course enrolment rates (>90%) and course completion rates (>85%), resulting in the revocation of their sponsor licence and ability to enrol international students. The government plans to raise the pass requirement for each metric by 5% (e.g. a 95% enrolment rate). 

Their records suggest that 22 higher education institutions (together sponsoring 49,000 students) would have failed to meet at least one of the higher metrics in 2023-24 if they had been in place at the time, so sponsors will need to work to improve their compliance or risk the loss of their sponsor licence and access to international students. The government will also introduce new interventions for sponsors who may be approaching the point of missing their metrics targets, including bespoke action plans (which we already see for work sponsors) and limits on international students in the meantime.

Sponsors who use agents to recruit overseas students will also be required to sign up to an Agent Quality Framework, to prevent abuse (e.g. due to mis-selling or misrepresenting student visas) and ensure that institutions maintain responsibility for genuine students.

Finally, sponsors will be expected to demonstrate that they are considering local impacts in their approach to recruitment of international students. It’s not made clear what this proposal is aimed at or intended to achieve.  Students clearly make a significant contribution to local economies through living expenses and other spending. However, in recent years there have also been numerous news stories about shortages of student occupation and the knock-on impact on housing more generally.

Short-term study for English language

This route can be used to study an English language course between six and 11 months at an accredited institution.  The white paper declares that the government will conduct a review of accreditation bodies (such as the Office for Students) to ensure that they are appropriately assessing and monitoring education providers in the UK. 

Changes to the student’s journey – graduate visa and beyond

For individual students who are genuinely studying in the UK, the impact of the sponsor changes may be limited, except perhaps if sponsors pass on the cost of the levy to students in the form of higher fees. This means the bigger changes affecting students will be in what happens after they complete their course.

The headline announcement here is that the graduate visa will be shortened from two years (or three years for PhD level students) to 18 months. There is no mention whether a longer duration for PhD students may still be available so the new 18-month limit may apply to all graduates. This change is designed both to decrease the pull factor of student visas for those who see it as a means to enter the labour market instead of genuine study, as well as to ensure that graduate visa holders work in graduate roles. 

The white paper estimates that, although 90% of graduate visa holders were working within six months of their visa start date, between 30% and 70% of them were not working in graduate-level roles.  The shorter duration is designed to move graduates into other visa routes, such as Skilled Worker (which now requires a graduate-level job), more quickly.

The key question for many graduates is what category they should switch into and whether it’s even better to do that without using the graduate visa at all. When a graduate visa holder switches into the Skilled Worker route, their employer needs to pay the Immigration Skills Charge – this is increasing by 32% and, combined with doubling the time that a person needs to be sponsored to qualify for settlement, this places huge costs on the sponsor. However, students switching directly to Skilled Worker are exempt from the Immigration Skills Charge for the duration of their sponsorship in the same role and for the same employer, with potentially massive savings for employers and making it easier for the individual to find sponsored employment.

Proposed changes to other routes may also make them attractive to students considering their next steps. The white paper pledges to review the Innovator Founder route (for entrepreneurs and business founders) so that it supports students to move on from university. It’s not yet clear what changes are being considered here but students are currently restricted from engaging in business activity, making it difficult to start the process of establishing a business in the UK. 

Hopefully this review will make it easier for students to do this. Other changes include increasing the number of places on schemes for research interns, such as those working in AI, and making it easier for top scientific and design talent under the Global Talent route.

In the long term, students may wish to stay in the UK permanently.  The white paper proposes doubling the qualifying period for settlement to 10 years, which students don’t even start counting until they switch to a route like Skilled Worker so in practice it will be even longer for students.  On the plus side, proposed changes to English language ability for settlement should not affect people who had student visas as students already need to meet the new higher level in order to study in the UK.

An odd outcome of the policies in the white paper is that UK graduates are seeing more restrictions, while graduates of overseas universities using the High Potential Individual (HPI) visa are seeing expansions to the route, including doubling the number of institutions that overseas graduates can have studied at, with no apparent reduction to the visa duration.  This risks creating a two-tier system where a student that graduates from a top international university qualifying for the HPI visa will have a longer opportunity to stay in the UK than graduates of British ones.