The UK government has dashed universities’ hopes for a £2 billion bailout, but will allow institutions to collect advanced tuition fees worth billions of pounds to alleviate short-term cash flow pains.

In a package announced today by Whitehall ministers, universities have agreed not to engage in what have been labelled “predatory” student admissions practices in return for an advance of fees worth up to £2.6 billion.

The stimulus was announced weeks after Universities UK, the sector’s representative body, tabled an ill-received proposal for a £2 billion bailout, in which it warned of potential bankruptcies should government fail to provide a cash injection to cover losses stemming from a sharp fall in international students.

Instead, in addition to the advance on tuition fees, universities have been granted an advance of £100 million in research funding, pending the outcome of a ministerial task force review, which will weigh potential further support measures.

Universities will also be permitted to charge full fees in the next academic year, even if courses continue to be taught online in order to comply with social distancing measures, UK universities minister Michelle Donelan has said.

"We don't believe students will be entitled to reimbursement if the quality is there," she said. University students in the US and elsewhere have filed lawsuits in attempts to obtain refunds as they argue that the online education they are receiving is subpar.

Julia Buckingham, president of UUK, has welcomed the government’s announcement, but said that more would need to be done “to protect the strength, capacity and quality of the research base” that will play an integral role in the economy’s recovery from the Covid-19 pandemic.

“Universities will want to examine and understand more fully the details of today’s announcement and then work with government to ensure that detailed measures are developed to meet both the scale and diversity of pressures that universities are facing," she added.

Notably, the government’s package offers no guarantees that all universities will survive the coronavirus crisis. If institutions were at risk of closure, the government would only intervene in instances where “there is a case to do so” – and, even then, only “as a last resort”.

The government has also said that up to 10,000 additional student places would be made available in England, of which at least 5,000 will be earmarked for nursing, midwifery or health courses as the country prepares to navigate out of a pandemic that has crippled its economy.