Thames Valley University will submit monthly financial reports to the funding council as huge student under-recruitment raises fears of a Pounds 3.8 million funding shortfall.
Sir William Taylor, appointed acting vice-chancellor last week, and Quentin Thompson of PricewaterhouseCoopers, will work with the governing body and staff to form an action plan. Officially, the university has not published details of the projected shortfall, which is due to under-recruitment in most subjects and levels, but includes under-recruitment of about 30 per cent to undergraduate courses in the current academic year.
The Higher Education Funding Council said that it has demanded the monthly reports in the face of potential cash-flow problems caused by the poor recruitment. Under HEFCE rules, fewer students mean less money. However, a spokesman said the council is looking at ways of "reprofiling" the grant.
HEFCE added: "If the action plan concludes that restructuring is necessary to secure longer-term academic and financial viability, HEFCE will be prepared to consider transitional financial support, subject to being confident that it will represent a good use of public funds."
Events at TVU have raised wider concerns about university governance and management. Lecturing union Natfhe said that staff at TVU had brought their concerns to the attention of governors long before the system broke down. The union wants more staff representatives on governing bodies.
A spokesman for Beachcroft Stanleys, solicitors for HEFCE and the Quality Assurance Agency, said that events at TVU could lead to more central scrutiny of university quality and value for money, possibly by HEFCE or the QAA.