A rise in tuition fees will not ease the “severe” financial pressures facing universities as rising National Insurance contributions will further squeeze budgets, sector leaders have warned.

Education Secretary Bridget Phillipson announced on Monday that undergraduate tuition fees in England – which have been frozen at £9,250 since 2017 – will rise to £9,535 next year.

She said it was necessary to “future-proof higher education” amid financial challenges.

But Professor Robert Van de Noort, vice-chancellor of the University of Reading, said raising tuition fees in line with inflation would only prevent their value from falling in real terms even more than they already have.

He said: “It might help prevent things from getting progressively worse, but it does not fully alleviate the severe financial pressures facing the sector, which have increased this month with the increase in employers’ National Insurance contributions.”

Last week, the University and College Employers’ Association (UCEA) warned that changes announced in the Budget to employers’ National Insurance (NI) contributions would cost the sector £372m and exacerbate the funding challenges facing institutions .

University leaders have repeatedly warned of significant financial concerns as a result of a freeze in tuition fees paid by domestic students and a drop in international student numbers.

Nick Hillman, director for the Higher Education Policy Institute (Hepi), said universities needed a fee rise that was “significantly above inflation even to break even” because of the extra costs they face as a result of NI changes.

He added that “concerns about financial instability will continue” in light of the 3.1 percent tax increase.

Raj Jethwa, Chief Executive of UCEA, said: “Any increase in income is helpful, but higher education employers will continue to face very difficult cost challenges due to the recent increase in employer NI contributions, in addition to increases amazing benefits of the TPS pension. costs.”

The Department for Education (DfE) has said that long-term funding plans for the higher education sector will be set out in due course.

If the Government chooses to increase tuition fees in line with inflation each year, the maximum tuition fee could reach £10,680 in 2029/30, according to the Institute for Fiscal Studies (IFS).

Kate Ogden, senior research economist at the IFS, said: “If the government intends to keep raising the fee cap with inflation, it should say so – and give some certainty to universities and prospective students alike.”

Professor Shitij Kapur, vice-chancellor of King’s College London, previously suggested universities needed tuition fees of between £12,000 and £13,000 a year to cover costs.

On Tuesday, Health Secretary Wes Streeting defended the government’s decision to increase undergraduate tuition fees, saying it was a “proportionate and reasonable thing to do”.

The Labor Party has come under fire for raising taxes for the first time in eight years after Sir Keir Starmer advocated scrapping them during his 2020 leadership campaign.

The Universities and Colleges Union (UCU) called the tuition fee hike “morally wrong”, while the National Union of Students (NUS) said students were being asked to “foot the bill”.

Mr Streeting told Sky News: “I think the risk is that if we didn’t price the fee and maintenance support in line with inflation, then students would be really sold short because the investment in teaching them wouldn’t keep up with the growth . cost pressure.”