Speaking in the House of Commons on November 4, Phillipson revealed that as of April 2025, the maximum cap for domestic tuition fees will rise by £285 to £9,535 per academic year.

Tuition fees have been set at £9,250 per year since 2017, with many arguing that universities have become over-reliant on the heftier fees paid by international students to sustain their finances.

It remains unclear by how much, if any, fees for international students will increase.

“With tuition fees frozen universities have suffered real terms-decline in income,” the education minister said, announcing the increase of around 3.1%, which she said is in line with inflation.

“We will fix the foundations, we will secure the future of higher education so that students can benefit from a world-class education for generations to come,” said Phillipson.

“Increasing the fee cap has not been an easy decision, but I want to be crystal clear that this will not cost graduates more each month as they start to repay their loans.

“Universities are responsible for their own finances and must act to remain sustainable.”

Meanwhile, Phillipson also announced a lower fee limit of £5,760 will be introduced for foundation years in classroom-based subjects such as business, social science and humanities.

Universities UK recently called for tuition fees to be increased in line with inflation, as an increasing number of institutions facing a budget deficit overall. A report from the body said that tuition fees must be index-linked to inflation, “not to address the funding shortfall, but to allow fee income to maintain its real-term value over time”.  

In June 2024, the OfS annual review painted a bleak financial picture for England’s higher education sector, predicting that a significant decline in international student numbers, coupled with no cost-cutting activity could lead to up to 80% of institutions being in deficit by 2026-27. 

Phillipson announced further reforms relating to maintenance grants, “boosting support for living costs”. Maintenance loans for students in England are set to increase by approximately 3.1%, which the government claims will allow students to receive up to £414 more per year – a figure also in line with inflation.