On Saturday, the Financial Times reported that at least 22 British universities are offering discounts on postgraduate study for international students. The newspaper called it a “price war”, with some institutions automatically offering discounts of up to £8,000 to overseas recruits.

Foreign undergraduate and postgraduate enrolment to the UK has fallen in recent years, yet universities are still competing for international students because they are financially desperate. A big reason is that domestic tuition fees for undergraduates have effectively stayed at £9,000 a year since they were introduced by the Cameron-Clegg coalition government. The real-terms value of those fees has thus fallen by about a third since they were introduced. For most of the past decade, universities balanced the books through recruiting huge numbers of international students, often paying in the region of £30,000 a year. Domestic undergraduates were massively subsidised by students from places such as China, India, and Nigeria.

But in response to growing unease over immigration levels, visa rules were tightened — in particular, ending permission to bring across families. Yet university administrators across the sector had previously convinced themselves that ever more foreign students would keep coming, in ever greater numbers. They had borrowed accordingly, often leveraging huge infrastructure debts on the presumption that overseas fees would never dry up.

And then reality bit. Today, the underlying maths of the British university sector simply does not work. Not only do universities not receive enough domestic fee income from undergraduates, the drop-off in international postgraduates means they aren’t bringing in enough money to cover the shortfall.

Predictably, this leads to competition. As the FT report shows, one way is to try to undercut your competitors on price. But if there is reduced demand for your product, not every seller is going to be able to find a buyer, even at discounted rates. On the current financing models, the universities will not be able to get enough money to all stay solvent. The ship is going down, and there are not enough lifeboats.

But this is not the only way in which universities are competing. Last year at King’s College London, my department was told — not consulted, told — that this coming year we are taking 30% more undergraduates. After years of being incentivised to provide master’s degrees aimed at foreign markets, the university is executing a hard pivot towards domestic student numbers to stay solvent.

We are not reducing our admissions criteria. We are simply making more offers. And because we are based in London, we know it works. Students who would previously have gone to places such as York, Nottingham or Edinburgh, come to us instead. We are cannibalising the Russell Group.

Obviously, other institutions are trying to do the same. Last year, University College London increased its undergraduate intake by 26%. Places that are less prestigious, or not based in London, reduce their offers. This is how the Russell Group managed to increase intake by 9% last year, now accounting for 29% of all enrolments.  But this squeezes universities lower down the pecking order, unable to attract applicants they would previously have recruited. It’s dog eat dog, in a race to the bottom.

Andy Burnham has a bulging in-tray. But if he truly cares about protecting regional economies, he needs to recognise that a lot of them risk being tanked by the collapse of the local university, which is often one of the biggest local employers. The Office for Students says that four in 10 universities are on course to be running deficits in the year 2025/26 — with plans to solve this predicated on “overoptimistic forecasting” combined with short-term fixes, such as the overreliance on foreign student income, that aren’t “going to be enough”. The Starmer government kicked the can further along. But the end of the road is near. Over to you, Andy.