Newcastle University faces £35m black hole as international student numbers decline

A decline in the number of international students at Newcastle University will leave a £35 million shortfall in their budget, according to an email sent to staff.

The university's vice chancellor Professor Chris Day told staff that there will be immediate cost cutting measures which include a freeze on changes to existing contracts, including requests for longer working hours.

Reviews are also underway for the annual staff pay review and academic promotions.

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".

He said Newcastle University had already built in £15 million of "mitigations" in its annual budget, but must now find an additional £20m in savings to avoid a financial deficit.

According to the email, Newcastle University’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" and 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.

It is also expected that the majority of the university’s payment cards will likely be withdrawn and suspended.

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.

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