UUK task force to consider mergers as part of efficiency drive

Mergers and acquisitions will be one of the focuses of an “efficiency task force” being established by Universities UK that aims to develop “radical” proposals to encourage new ways of working in a sector beset by financial issues.

Sir Nigel Carrington, the former vice-chancellor of the University of the Arts London, has been appointed to lead the initiative that will outline the business cases for various forms of collaboration and new ways of generating income.

Writing for Times Higher Education, Sir Nigel said the “rapid formation” of the task force – first announced in Universities UK’s blueprint document published earlier this year – was “evidence that we are prepared to think radically about transformation to tackle the challenges we face”.

It will take an “all options on the table” approach, Sir Nigel adds. “The scope of our discussion will include everything from systems- and process-sharing to shared delivery of some student-facing services and changes to operational and business models,” he writes.

In response to growing funding difficulties, many universities have been forced to make drastic cutbacks in recent years, affecting jobs, course provision and research.

Such moves have often been made individually, however, and lacked any joined-up approach, leading to concerns about “cold spots” developing and the impact on the student experience. It is hoped that encouraging universities to collaborate by, for example, sharing some professional services, could be a less painful, more strategic, way of securing further savings.

Delivering efficiencies is also seen as one of the key asks of government in return for future funding settlements, with the sector – that was cushioned from the austerity years that hit much of the public sector – still seen as overly bloated in some quarters of Whitehall.

Sir Nigel, a mergers and acquisitions lawyer, will lead a group of a dozen experts to consider the business cases for various forms of cross-sector working.

Options highlighted by Universities UK include the “transformation of operating models, mergers and acquisitions, federated structures, future workforce planning and understanding how AI is likely to transform teaching, research and operations”.

A review of the impact of the cuts made by universities in England over the past decade will form another part of the task force’s work.

Overcoming the competition in the sector, with universities often trying to develop a distinctive offer to recruit students, is seen as a key barrier to more collaboration. There are also practical difficulties, such as the need to pay VAT on shared services, and the cost and bureaucracy involved in mergers means it can be years before they yield savings. 

Sir Nigel led UAL for 13 years until 2021 and oversaw its transformation from a federal model comprising six independent colleges to a more integrated institution. He also led the merger of three sector agencies that became Advance HE in 2018.

“This critical work will usher in a new era of collaboration and cooperation between universities to drive even greater value to students and taxpayers,” he said, adding that reducing costs was not the only aim of the initiative.

“Our work will drive meaningful change by creating evidence-led recommendations around working well together and being productive for the long-term.”

Education secretary Bridget Phillipson welcomed the formation of the task force and said she looked “forward to seeing innovative and robust proposals to help secure a sustainable future for higher education”.

tom.williams@timeshighereducation.com