Select committee: Education Committee
Conclusion 23
9th Report - Higher Education and Funding: Threat of Insolvency and International Students
Published 12 May 2026
Addressed to Department for Education
Education Committee Higher Education and Funding: Threat of Insolvency and International Students All items in this report Report on parliament.uk ↗ Inquiry on parliament.uk ↗
Conclusion (the committee's words)
We have heard conflicting views about whether a higher education provider can continue to operate when insolvent. The Minister for Skills says that she thinks they can, arguing that institutions entering liquidation can carry on operating whilst being wound up. She stated that the threshold for government intervention in such a scenario would be very high. By contrast, the law firm Mills & Reeve LLP and sector stakeholders think an insolvent provider would, depending on their legal structure, potentially have to stop 113 trading and be liquidated immediately, which would have an immediate and devastating impact on students, who would not be able to complete their course. (Conclusion, Paragraph 133)
From: Education Committee, 9th Report - Higher Education and Funding: Threat of Insolvency and International Students (HC 807), 12 May 2026
Government response
The government responded to the whole report on 22 July 2026 (deadline 12 July 2026).
Summary written by Accountability Index from the government's response. It is not the government's own words.The government welcomes the report and sets out its position on each recommendation, accepting a few, partially accepting several, rejecting others and stating that many are covered by "plans already in place".
- On insolvency, the government rejects a bespoke special administration regime, saying it is "not currently persuaded" the case has been "sufficiently demonstrated", and that intervention is not the default response.
- On teachers' pensions, it rejects the recommendation and does not consider additional financial support for higher education providers in England "appropriate", but says HM Treasury has confirmed the employer contribution rate will fall from 28.68% to 17.5% from April 2027, fixed for four years.
- It declines to commit to a timeline for reaching 80% cost recovery across all research funders, because the main drivers are "the decisions of independent and autonomous institutions".
- On international students, it says the levy will not start until 2028/29, with an allowance for the first 220 international students per year, and that maintenance grants of up to £1,000 will return from 2028/2029.