Confirmed: Eight major Welsh universities have a combined deficit of £116 million

New financial reports from the 2024-2025 academic year show many Welsh universities are in financial hardship.

The accounts outline how the entire higher education sector in Wales is trying to “shrink its way back to viability”, by cutting staff and other factors while expecting the same level of quality of teaching and research.

There are eight higher education institutions in Wales which are reported to have had a total deficit of around £116 million from 2024-2025.

This includes the three top contributors of this deficit from: Cardiff University having a £33.4m deficit, Swansea University with £40m of deficit and Bangor University with £18m of deficit. 

Examining the financial state of these institutions highlights how the real issue may not be with individual universities, but the Welsh higher education sector as a whole.

The results show that income from full-time international students has fallen from £56m to £38m, as the universities have 2000 fewer international students than the year before.

University of South Wales has lost over 8,200 UK students since 2014-15, with most of its current students coming from the local area.

Over the eight universities, there has been a net reduction of 666 full-time positions. This statistic highlights an overall shrinking of this sector.

via Unsplash

A Swansea University spokesperson said: “Swansea University has published its financial statements for the year to 31st July 2025. These show a reported underlying operating deficit of £39.9m, as was planned and agreed with Swansea University’s governing body.

“This approach has enabled us to phase our ongoing work to rebalance our expenditure in line with a reduction in income. This deficit reflects an exceptionally challenging operating environment in the higher education sector within Wales and the UK over recent years, with continually rising costs due to high levels of inflation and lower income levels due to significant falls in
international student numbers and an increasingly competitive home market.

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“Over the past three years, we have proactively sought to improve our financial sustainability through the careful management of our income and expenditure; this includes ongoing vacancy management, the introduction of voluntary exit schemes and
our recent draft proposals to secure pay savings across our academic community, which currently remain under consultation.

“While we are also forecasting a significant underlying operating deficit for financial year 2025-26, we are confident that the measures that we are taking to reduce our expenditure this year will improve our outlook for future years. We have communicated transparently with our recognised campus unions and our staff community in respect of our financial outlook, and will continue to do.” 

A University of South Wales spokesperson said: “It is an incredibly challenging financial climate for the whole higher education sector and like many institutions we are facing a deficit budget.

“We have been implementing a planned programme of work to address this over the last couple of years and continue to do so to provide a sustainable financial position.”

A Cardiff University spokesperson said: “A deficit was forecast and council allowed us to budget for this third  consecutive year of deficit. Had we not taken action we did over the year (through our Academic Futures programme), the deficit would have been significantly higher (around £65m).

“The sector as a whole is facing ongoing financial challenges with many institutions reporting deficit budgets. A deficit budget if not unique to Cardiff and does not mean that Cardiff is in financial difficulty.

“We are aiming to return Cardiff cost base to a sustainable position in the coming years and the university is taking proactive steps to build a sustainable future.

“Despite the year’s underlying operating deficit of £33.4 million, Cardiff retains a strong balance sheet underpinned by significant assets values and reserves. At 31st July 2025, the university’s consolidated net assets were £821 million.”

The University of Bangor and Welsh Universities has been contacted for comment.

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