Britain's Bloated Universities Need to Shrink

Never let a good crisis go to waste, runs the adage attributed (apocryphally) to Winston Churchill, a man who disliked school and didn’t go to university. The career of Britain’s wartime prime minister should be evidence enough that you don’t need a degree to succeed in life, contrary to the thrust of UK higher-education policy for the past three decades. The financial distress afflicting universities will be a missed opportunity if it fails to prompt a reset of the sector’s business model. The bottom line is that the system needs to shrink.

British higher education shows the symptoms of an investment boom that has turned to bust. The decision to transform university from an elite into a mass experience released reserves of hitherto unexploited entrepreneurial energy in the ivory towers of academia. In the early 1980s, about one in seven school leavers went on to higher education; by 2019, that proportion had more than tripled to 50%, reaching a target set by former Prime Minister Tony Blair two decades earlier. But the state never supplied the funding to achieve such a massive expansion. Left to their own devices, institutions turned to higher-paying international students, recruiting greater numbers, raising fees and borrowing to invest in new facilities. University executives also started to reward themselves more handsomely for their more businesslike approach. It all succeeded too well — until the music stopped.