When the Market Stops Working

Student number controls and the identity crisis in English higher education

A policy proposal can expose the limits of the system that produced it. Bahram Bekhradnia’s HEPI report, Demographic decline and predatory recruitment: The twin threats to English higher education into the 2040s, does more than warn about recruitment pressure; it reveals a deeper uncertainty about what English higher education now claims to be. For years, English higher education has been governed through market language, with students comparing providers and universities competing for applicants. Fees, loans, rankings, branding, and student choice shape the public narrative of the sector. Brown and Carasso (2013) describe this as part of a wider shift in which market steering became central to the organisation of UK higher education.

That market story has always been incomplete; universities are unusual institutions, and students are unusual consumers. Higher education involves learning, professional development, local opportunities, and public capacity. These functions do not fit neatly into a buyer-provider relationship. Molesworth et al. (2009) make this point from a pedagogical angle, they argue that market discourse can encourage students to seek to “have a degree” instead of “be learners”. Their concern is that consumer language changes the educational relationship.

Bekhradnia’s (2026) report makes this tension harder to ignore: HEPI argues that the young population from which most undergraduates are recruited is expected to decline rapidly after 2030. The report states that around 80% of undergraduate recruitment comes from this young population, and that income from this source could fall by nearly 20% within ten years of the decline. The report also argues that the real value of the tuition fee has fallen by 25%–30%. This creates pressure on universities to recruit more students. Bekhradnia (2026) is concerned that higher-tariff institutions have increasingly recruited students with lower school achievement than they would previously have admitted, reducing the pool available to other universities.

This creates a distributional problem: if higher-tariff universities continue to recruit strongly from a shrinking domestic pool, other institutions may face sharper falls. Bekhradnia (2026) warns that in two of the three scenarios he considers most likely, non-higher-tariff universities could lose more than a quarter of their undergraduate student income. The wider financial context is already strained, and The Office for Students (2025) reported that recruitment volatility continues to affect provider finances. It also stated that without mitigating action, 124 institutions, representing 45% of those included in its analysis, could face a deficit in 2025–26.

Bekhradnia proposed some form of student number control. In plain terms, this would limit recruitment at certain institutions so that stronger recruiters cannot absorb too much of the shrinking applicant pool. HEPI starkly frames the policy choice: allow the market to determine the future shape of the sector, with the risk that viable universities fail, or impose a limited curb on recruitment by the institutions concerned (Bekhradnia, 2026). There is a serious public interest in intervention. Universities support regional economies by providing routes into skilled employment and sustaining local access to higher education in places where relocation is difficult or unaffordable. If market competition hollowed out parts of the sector, the effect may be felt beyond institutional balance sheets. A market can close a shop, but closing a university has more serious consequences.

The number of controls should not be dismissed as crude protectionism. A country may decide that it needs a broad distribution of higher-education provisions. It may be decided that institutional collapse would damage regions and students who depend on local access. A planned element in higher education is not automatically irrational. The difficulty is that number controls awkwardly within the moral logic of the English funding model. Students have been asked to carry high personal financial risks on the basis that they are choosing between providers in a competitive system. The defence of that model depends heavily on autonomy; the student borrows, so the student chooses. The university competes, so it wins or loses applicants.

Number controls alter that logic; a student may want to attend a particular university, meet the requirements, and be willing to take on the debt, yet still be unable to enrol because that university has reached its cap. At this point, the choice becomes conditional on system management. Students still carry private financial risks, but the freedom attached to that risk has been restricted. This may be defensible, but it still needs to be said plainly.

The deeper issue is that each major actor has a reason to resist plainness. Higher-tariff universities are unlikely to welcome caps because they reduce their recruitment advantage. If students want to attend them, and if those institutions can convert demand into enrollments, they will ask why they should be restrained. Lower-tariff universities may benefit from protection, but visible protection carries reputational risk; in a marketised sector, being protected can easily be read as being weak. Governments may want stability while avoiding a direct admission that competition has produced unacceptable consequences. The number of controls would make it difficult to avoid admissions. Students, meanwhile, could support a broad national university system in principle, while still objecting if that principle blocks access to a preferred institution.

This is why the debate is revealing: student number controls are a recruitment policy, but they also expose an unresolved question about the identity of English higher education. Are universities competing with providers? If so, student choice must be allowed to reshape the sector, even if the results are harsh. Are universities public infrastructures? If so, the government needs to plan and fund them more openly. The current settlement attempts to hold both positions. Universities are expected to compete for students and income, and students are expected to borrow as individual market actors. Governments then face pressure to intervene when the market produces outcomes that appear socially damaging or politically intolerable. This settlement is becoming increasingly difficult to defend.

The number of controls may slow down institutional damage. They may prevent some universities from being rapidly drained of applicants or buy time for a sector entering a difficult demographic period, but they do not repair the funding model. They do not restore the real value of the unit of resource nor create more domestic applicants. They do not remove the pressure on universities to chase recruitment volume; they redistribute scarcity. Redistribution may still be preferable to uncontrolled institutional failure, but it should not be mistaken for reform.

Bekhradnia’s report is valuable because it forces this problem into the public view. The central issue is not whether student number controls are good or bad in isolation, but what their return would reveal. This would reveal that student choice has limits and that institutional survival remains a public concern. It also reveals that English higher education has never fully settled the relationship between market competition and public responsibility. This is the real significance of the debate; student number controls ask how many students each university should be allowed to recruit. Behind that sits a harder question: what kind of system is English higher education prepared to admit it has become?

References

Bekhradnia, B. (2026). Demographic decline and predatory recruitment: The twin threats to English higher education into the 2040s. Higher Education Policy Institute. https://www.hepi.ac.uk/reports/demographic-decline-and-predatory-recruitment-the-twin-threats-to-english-higher-education-into-the-2040s/

Brown, R., & Carasso, H. (2013). Everything for sale? The marketisation of UK higher education. Routledge.

Molesworth, M., Nixon, E., & Scullion, R. (2009). Having, being and higher education: The marketisation of the university and the transformation of the student into consumer. Teaching in Higher Education, 14(3), 277–287. https://doi.org/10.1080/13562510902898841

Office for Students. (2025). Financial sustainability of higher education providers in England: November 2025 update. Office for Students. https://www.officeforstudents.org.uk/publications/financial-sustainability-of-higher-education-providers-in-england-november-2025-update/