Higher Education in 2011 - A Year of Debate
In his annual address to staff, Sir Robert set out some of the challenges and opportunities faced by the University.
He began by highlighting two key questions that have arisen from announcements made over the last academic year; ‘How do we maintain a world class University?’ and ‘How do we meet the Government challenge?’
The Browne Report set out the view that there was no alternative to fee setting as a result of the expansion of higher education. There were positive implications for some in so much as part-time students were now part of the funding mix. However, this contrasted with ambiguity around how postgraduate taught and research courses would be funded in the future. The report did highlight opportunities for distance learning, cross-subsidies and bursaries that would be advantageous for the University.
The Comprehensive Spending Review set out the nature of the problem facing the sector. An 80% cut in teaching funding and further cuts to capital funding will not just affect Leicester’s teaching income but also the ability to build new seminar rooms and labs.
The Vice-Chancellor considered that the recommendations from Browne would not work by only implementing particular elements, which is what the sector believes the Government has done. This has presented some difficult decisions. Two thirds of higher education institutions will be charging fees of £9,000 from 2012 and OFFA has not been given the powers to restrict universities doing this.
Leicester’s challenge now is to communicate its decisions effectively by clearly stating what it is offering to students. There are two key messages:
- No student from the UK or Europe pays at the point of entry.
- Only when a graduate is earning £21,000 do they start to pay and then they will have up to 30 years to pay back the loan before it is written off.
The White Paper ‘Students at the Heart of the System’ was published six months after the Government’s response to Browne. This paper announced the opportunities for universities to bid for additional government-funded student numbers, with the aim of opening up the higher education market to enable FE colleges and private providers to compete with universities. The allocation was made up of 65,000 places for students with grades AAB or better and 20,000 places for those institutions where the average fee is below £7,500. The latter additional numbers will not help Leicester and other universities like it as our fee is above the threshold. However, Leicester does have an £8.4 million package of scholarships and bursaries available to support students.
The White Paper also announced the decision to give HEFCE a regulatory role, more detail of which is awaited.
Recruitment figures for the year ahead are buoyant, some 16% up on last year and open day bookings are high which bodes well for the future.
The Vice-Chancellor then went on to discuss Financial Forecasts. Leicester has so far been successful in financial terms. Last year a surplus of £16m (6.3%) was generated and this year figures are in line to generate a surplus of £9m (3.5%). It is important to build on this financial success in light of the many national issues affecting the sector. Universities are afforded some protection by their autonomy but the next few years present some challenges.
The current financial forecasts are based on the following assumptions;
- there will be a £25m cut in the HEFCE and TDA Grants 2011/12-2014/15;
- low pay awards for 2011;
- a surplus of 1.7% in 2011/12, rising to 4% in 2014/15 being generated which will provide cash for capital investment, both academic and social;
- costs associated with pensions will increase;
- the voluntary early retirement /severance scheme will continue for those who feel that they do not want to continue on this journey with us.
Sir Robert stressed that “We do not want to shed jobs. I do not envisage there having to be compulsory redundancies”.
Research funding in the future will be focused on 3* and 4* research with an immediate reduction of £2-3million per year. This has been reflected in the University’s strategy for submissions to REF2014 (Research Excellence Framework). Ten Directors of Research Centres are also being sought to help develop and enhance Leicester’s research in the future and strengthen the research portfolio.
In lifting the cap on Home/EU fees to £9,000 Leicester will raise £35 million in income but will be giving back approximately £8.4 million in scholarships and bursaries, bringing the average fee to £8,100.
The University is still planning and working on other developments: work at Nixon Court, which includes 281 new rooms, will be ready for the start of the academic year; a new research facility has been completed; and work has recently started on a new Cardiovascular Research Centre on the Glenfield Hospital site. There will also be large scale investment in our IT infrastructure over at least the next three years.
It is important for the University to generate a surplus for a number of reasons. First and foremost it will enable the University to invest in buildings and IT and be in a position to respond to opportunities that arise at short notice. Having a surplus also acts as a contingency against shortfalls in future. However, the surplus only reaches so far. Pro-active fundraising is essential and there are currently three main fundraising projects;
- the Cardiovascular Research Centre;
- the Embrace Arts extension; and
- scholarships and Bursaries.
The Vice-Chancellor noted: “We are a big business with higher education at its heart; one of the largest employers in the city. We all need to continue to work together to make this work and, retain our commitment to high quality in all areas.
Each year we score highly for student satisfaction. This is not just down to the academic experience but the positive environment of the University as a whole.
Our research grant income is up by over 10% for the second consecutive year. We are ranked 10th in England for Research Impact, we have clear leadership in some academic areas and preparations are well underway for REF2014.
We need to use our higher league table positions, and our awards to shift perceptions and unlock new growth and success; this includes developments in the area of employer engagement. Alongside this we need to retain our market share of students, including the complex and dynamic area of international student recruitment.”
Sir Robert concluded by saying “thank you to all of you who make such a huge contribution to the University of Leicester, making it the high quality top 20 institution that it is today. Long may it continue.”