A new direction for post-16 education: Key takeaways from the Government’s White Paper

What has been published?

The paper arrives at a time of significant financial and operational pressure across the sector, with institutions grappling with rising costs, growing regulatory scrutiny and declining international student numbers.

Key proposals include:

• Inflation-linked tuition fees for higher education (HE) institutions from 2026 onwards, conditional on the delivery of high-quality teaching.
• A proposed 6% levy on international student fees intended to fund the reintroduction of means tested maintenance grants for domestic students. Further details are expected in the budget on 26 November.
• A shift in policy focus from the long-standing goal of 50% university attendance to a broader ambition: two-thirds of 16–19-year-olds progressing to university, further education (FE), or a “gold standard” apprenticeship.
• The introduction of V-Levels, a new qualification designed to sit alongside A Levels and T Levels, to simplify the qualification landscape for 16–19-year-olds. V levels are expected to launch from 2027-28.
• A £1.2 billion annual funding boost for the further education (FE) sector by 2028-29, alongside a long-overdue review of the 16–19 funding formula.
• Expansion of Technical Excellence Colleges, with 14 new institutions planned in high-growth sectors such as digital, clean energy, and advanced manufacturing.

These proposals are positioned as part of a wider effort to rebalance the post-16 education system, improve quality, and ensure long-term financial sustainability.

What does this mean for education providers?

For higher education institutions, the inflation-linked fee increase offers some financial relief amid mounting pressures, including those stemming from the reduction in international student numbers. However, the conditionality tied to teaching quality raises questions about how this will be measured and regulated by the Office for Students (OfS). There’s also concern it could lead to a two-tier HE system, where some institutions struggle to meet the criteria and are forced to offer lower-cost, potentially lower-quality provision.

The proposed 6%levy on international student fees could further strain university finances. Universities will need to decide whether to absorb the cost, potentially impacting teaching and facilities, or pass it on to overseas students, which could affect demand for courses depending on brand strength and market positioning.

For the further education sector, the introduction of V-Levels and the funding uplift are welcome developments. These changes aim to address long-standing issues around qualification complexity, underfunding, and staff recruitment and retention, particularly the pay disparity between FE lecturers and school teachers.

What should education leaders be thinking about now?

With more detail expected in the 26 November budget, education providers should begin:

• Updating strategic plans and financial forecasts to model different funding and fee scenarios so they can understand the impact.
• Assessing teaching quality metrics and preparing for potential new regulatory requirements tied to tuition fee increases. Institutions should consider how they evidence quality and student outcomes in line with OfS expectations.
• Evaluating international student strategies, including pricing elasticity and competitive positioning in light of the proposed levy.
• Planning for curriculum and staffing changes in response to the introduction of V-Levels and the associated funding reforms. This includes reviewing course portfolios and staff development needs.
• Reviewing governance and risk frameworks to ensure boards and leadership teams are equipped to respond to policy shifts, funding volatility and reputational risks.