The Coalition government's first Comprehensive Spending Review will cut 40% from university budgets by 2014. This will result in an increasingly tension-prone political economy of UK higher education. As it is, the sector already sits uncomfortably astride the two distinct welfare models currently in existence in Britain. As the fees agenda has taken hold, university degrees have been increasingly susceptible to being rebranded as a strategic investment in the future, thus acting as an exemplar for the move towards an asset-based system of welfare. Despite this, even in the post-Browne world students will still not be charged the full market price of delivering degree programmes. Higher education institutions therefore continue to be redistributive mechanisms providing long-term welfare-enhancing transfer payments to their overwhelmingly middle-class student base. The budget cuts and the associated changes to student finance will bring into stark relief the contradictions of serving two welfare masters at once.