University surpluses up by more than £2bn

30 Apr 18

UK universities banked surpluses totalling £2.3bn between 2015-16 and 2016-17, according to higher education statistics.

Analysis of university finances by the Higher Education Statistics Agency show that universities’ reserves now stand at £44.27bn – up from £12.33bn in 2009-10.

Between  2015-16 and 2016-17, universities’ income from tuition fees and education contracts increased by £931m from £16.8bn to £17.7bn in 2016-17 - a rise of 5.5%

HESA said this was "effected by the change to the funding regime". Tuition fees increased to £9,000 a year for most institutions in 2012.

Overall, 132 of 164 higher education providers reported a surplus in 2016-17, with only 32 reporting a deficit.

Despite this, spending on staff fell by 3.35% compared to 2009-10, while capital expenditure rose by 35% over the same period.

Sally Hunt, general secretary of the University and College Union, said: “With capital expenditure shooting up and staff costs coming down, it is clear that universities have been prioritising investment in buildings over staff.”

She accused universities of sitting on “huge reserves” and said the only people to benefit were  “vice chancellors whose pay and perks have long been a source of embarrassment for higher education”.

In a letter published in The Times, Universities UK chief executive Alistair Jarvis disputed claims that universities were hoarding reserves.

“Reserves are the value of a university’s assets minus its liabilities – they are not the same as cash. A university’s assets include lecture theatres, libraries, and laboratories. These are all essential to delivering the best possible student experience and world-class research.   

“It is flawed to compare university finances over a long time period since significant accounting changes, the biggest changes for 20 years, were introduced in 2015.”

The UCU led strikes in February 2018 after a controversy over changes to academics’ pension schemes.

Strikes were suspended earlier in April after both sides agreed an expert panel would review the pension scheme.

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