The University of East Anglia (UEA) has been forced to make additional cuts as a result of unforeseen extra costs, according to its vice-chancellor, who predicted that every university in the UK would now be making savings.
After being one of the first hit by what is now a sector-wide financial crisis, the university announced this week that it will have to make a further £11 million worth of cuts, with compulsory redundancies a possibility as 170 more staff members face losing their jobs.
David Maguire, who was brought in as UEA’s vice-chancellor 18 months ago, told a Westminster Higher Education Forum policy conference on addressing UK university financial sustainability that the institution had a “credible plan to reach financial sustainability in terms of deficit-surplus position within three years”.
“But last year, due to higher-than-expected inflation rates and lower international recruitment, which we – like many other providers in the sector – face, we are having to go around again looking at our expenditure and earlier this week I unfortunately announced we would be looking for a further £11 million in savings from our plan.”
UEA has already made changes to save £30 million in recent years and staff unions fear the institution will struggle to survive further reductions.
Professor Maguire said making “deep and repeated cuts” was “really difficult” but was something being considered across the sector.
A “back of the napkin” calculation based on announcements that have already been made meant it was “possible to estimate that around 10,000 jobs will be lost in the university sector in the current academic year”.
“That is an enormous number,” Professor Maguire said. “And if it was at one point in time or one place in the country, it would be considered a national disaster – there would be a huge outcry.”
Most universities were looking at reducing their expenditure by 10 per cent in real terms, said Professor Maguire, which was an “enormous undertaking and comes on the back of a series of difficult years for universities already”.
He said there were two types of universities currently: those making savings in public and others doing so in private. “Everybody has high up their agenda efficiency and effectiveness reviews and financial savings.”
Professor Maguire said universities seeking to make savings were faced with a “cascading” series of options starting with interventions such as not replacing staff through to structural changes – UEA has reduced its course portfolio by 20 per cent – and then more radical options.
“Quite a few” universities were actively talking about mergers as a possibility, claimed Professor Maguire, although none have yet gone public.
Cuts were also likely to involve reduced net zero targets, pauses in estates management projects and outsourcing services, he said, which could store up problems for the longer term.
On the more positive side, there were also drives to invest in marketing and new geographies as well as “sweating” assets such as conference facilities and research intellectual property.
“All these things have been going on in universities for years, but a number are now coming to the boil,” said Professor Maguire.
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