Welsh universities are facing an £18 million funding shortfall, prompting warnings of job cuts and calls for urgent reform.
This follows the UK government’s decision to increase national insurance contributions, according to research by the Liberal Democrat party.
The Labour government in Westminster has continually altered policies regarding funding for UK universities. The lack of additional funds – driven in part by a decline in high-fee-paying undergraduates and postgraduates – has forced Welsh universities to implement cost-saving measures.
The UK’s withdrawal from the European Union has worsened the funding crisis, as international students now face high tariffs that discourage them from applying to UK or Welsh universities.
The Welsh Liberal Democrats have criticised the UK Government’s decision to increase employer National Insurance contributions (NICs), arguing that the policy will burden Welsh universities with a combined £18 million in additional costs.
Cardiff University is set to be hit the hardest, with a predicted £6.7m annual hike, with Swansea University facing an additional £3.5m burden.
Lib Dem MP for Brecon, Radnor and Cwm Tawe, David Chadwick, raised the issue at the Welsh Affairs Committee.
According to Business Live, Mr Chadwick said: “It’s completely unacceptable that Welsh universities are now being saddled with millions in extra costs just to meet a tax increase that could and should have been avoided.
“That £18m could have helped avoid some of the redundancies now being pushed through by universities right across Wales.
“Instead of investing in the future of our young people and protecting skilled jobs, Labour has chosen to penalise the very institutions that help power our economy and society.”
In response, Welsh universities admitted they had not expected the rise in national insurance contributions. The increase comes at a troubling time, as Welsh universities face mounting financial pressures.
Cardiff University has faced the largest financial burden for the 2025/26 academic year at £6,720,000.
Cardiff University’s Vice Chancellor, Professor Wendy Larner, said the sector must “reinvent itself” and seek “new revenue streams.” She acknowledged that “governments are challenged” but expressed optimism about how future operating models could better serve Welsh universities.
Feature image via Creative Commons
