British universities are one of the United Kingdom’s greatest success stories.

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They are a world-leading export, attracting global talent, driving growth in every corner of the country, and acting as engines of innovation. From pioneering research that shapes the technologies of tomorrow to their role as anchor institutions in regional economies, universities are central to any credible strategy for economic renewal.

International students are a central part of that story. They bring intellectual diversity into our classrooms and laboratories, form lasting connections with Britain that strengthen our influence abroad, and contribute to the research and discovery that defines what universities are for. Economically, they also contribute over £12 billion annually.

That contribution is now under serious threat. Tightening visa rules have created a growing perception that Britain is becoming a less welcoming destination. Applications are falling, particularly in postgraduate and research-intensive areas. Universities that expanded in good faith in response to global demand are now exposed to sudden policy shifts. Compounding all of this, at the Autumn Budget, the Chancellor introduced a levy on international student fee income – increasing costs, reducing competitiveness, and sending precisely the wrong signal to the world.

The government's stated justification for the levy deserves scrutiny, because it doesn't survive it. Ministers argued that taxing international student income would fund maintenance grants for domestic students from low-income backgrounds – a goal that Liberal Democrats share and have long championed. But look at how the mechanism actually works. The levy is a flat fee, regardless of what institutions charge. Universities serving those from less affluent backgrounds – post-1992 institutions, former polytechnics, the universities that have done most to widen access – charge lower international fees than elite research universities. So proportionally, they pay more. The institutions most committed to the government's own access agenda are hit hardest by the policy designed to advance it.

There is a further problem. When those universities contract – cutting courses, shedding staff, reducing domestic places – the students who lose out are precisely the ones the maintenance grants were supposed to help. You cannot widen access to higher education by undermining the institutions that provide it to the widest range of students. The government is trying to fill one bucket while drilling holes in another.

The consequences extend well beyond individual institutions. International students are integral to the UK's research ecosystem and innovation capacity. In towns and cities across the country, they support local economies and businesses, and in many cases go on to work in sectors facing acute skills shortages, such as technology, healthcare, and engineering. By 2040, the UK will have significantly fewer 18-year-olds. That makes international students not just beneficial, but an essential piece of the puzzle for the long-term sustainability of many courses and institutions. Deterring them now stores up a structural problem we will find very difficult to reverse.

Liberal Democrats took a clear position at our Spring Conference: remove the levy, reverse the damaging National Insurance increases on universities, and restore Britain's reputation as an open and welcoming destination for international talent. That means a stable and competitive visa system, and a clear signal to prospective students and researchers around the world that they are valued here. The government's intentions on widening access are not in question. But good intentions implemented through a badly designed mechanism produce bad outcomes. This one damages the universities most committed to the goals the government claims to share. Ministers should think again

Ian Sollom MP is the Liberal Democrat Spokesperson for Universities and Skills.

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