Underscoring circumstances that could eventually pave the way for the expansion of the for-profit higher-education sector in Britain, a new report shows that more than two dozen higher-education institutions are operating at a deficit—one out of every five in the country. According to “The Financial Health of the Higher Education Sector 2011,” a report by the accounting firm Grant Thornton, 26 institutions have a deficit and nearly half have less than the 3-percent operating surplus recommended by the national higher-education financing council.

Although the report depicts the “sector as a whole being currently in a strong financial position,” it says that “a number of institutions may, due to a number of different factors such as their financial structure, their position in the market, or their reliance on certain income streams, find themselves very much more vulnerable than others.” The government’s recent report on higher education is widely expected to lead to the growth of the for-profit sector, and it has been speculated that failing universities could be taken over by for-profit companies.