“Difficult and unsettling” - our university’s financial situation

25/11/2024

Nouse reports on the University's finances

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Image by Nick Youngson

By Naomi Marques Wiggin

It should go without saying that the University of York is facing severe financial cutbacks. Dame Sally Mapstone, president of Universities UK, representing 141 higher education institutions including the University of York, warned earlier this year that universities will “slide into decline” without financial aid.

Students are already seeing the consequences of exhausted finances in the reduction in study spaces. Inflation rates have added about 20% to the University’s running costs - roughly £45 million. The University’s announcement for downsizing from King’s Manor has been justified in part by substantial maintenance and conservation costs. The building of the new £35 million Student Centre, proposed to be completed in 2025, has been paused due to financial pressure on the University. The Vice-Chancellor Charlie Jeffery has responded “we will get back to that as soon as we are in a stronger position.” Jeffery has also commented that  within the last 12 months, there have been £360 million research grant applications, which should “probably” turn into research grant rewards.

The University of York is trying to cut running costs, but there is significant concern about how this will affect students’ experience, as well as the quality of teaching. The voluntary severance scheme in September 2024 aimed for the loss of 2% of academic staff within 6 areas of the University in order to save £24 million. It seems departments across the University will suffer cuts differently - practical courses such as Music and Theatre will become more vulnerable than Maths and English etc. Nouse has spoken to several students concerned about potential cuts to teaching hours. One student said “I don’t understand where our fees are going.” Students are “worried about whether this will affect my degree, or how it will look for future employers.”

The University’s financial reports for the past three years show the combined impact of COVID-19, the cost of living crisis and loss of international students, who contributed more than £49 billion to the UK economy in 2021/22. York recently made headlines for lowering the grade boundaries for International students. The hope remains that by doing this the international figures can be reversed, additional tuition fees charged and more income generated. The 2023 report stated “The university has faced levels of inflation not seen in decades, uncertainty in global markets, and an unsustainable Higher Education funding model, all of which have added pressure to our financial planning.” York ended the year with a deficit of £24 million, following the flat-lining tuition fee income for the year, high inflation on staff costs and operating expenses. Last academic year, York saw the percentage of international masters students down 55% and int. undergrads down 23%.

The tuition fee was capped at £9,250 in 2017 which meant fees had not followed inflation, unlike the cost of resources and running university buildings, which has worsened the situation. Labour is due to increase tuition fees by £285 from September 2025 to keep pace with rising costs.

In August, Nouse spoke to a staff member from the Theatre, Film, Television and Interactive Media department (TFTI) who said “Every department had to produce a budget with significant cuts. The plan as submitted would reduce taught hours somewhat but the course is still doable with the cuts,” emphasising that the main change students will notice is a reduction in taught hours. A Nouse investigation by Sarah Gent in August of this year came to the conclusion that the biggest differences that students can expect are a reduction in contact hours, larger class sizes and fewer staff members.

Jeffery released a statement in April where he stated “the UK higher education system is in a crisis. The way it’s funded just doesn’t work anymore.” His ten point plan with suggestions of what is needed to create long term stability for the higher education sector, including creating a single government department to fix issues such as visa regulations for international students, supporting researching and funding with maintenance grant adjustments, and increasing funding. The current government has no plans to adopt these solutions so it seems highly unlikely this will happen anytime soon.

Despite the University’s justifications for their informed moves during an “unavoidable” financial crisis, Jonathan Fanning, Vice President of the York Branch of the University College Union alleges that poor decision making made by the University has been a key factor in the crisis. In an interview with News Editor Tom Layton, Fanning stated that “some of the decisions they’ve made have been wrong”, pointing to the University of York’s Executive Board’s decision to rely massively on the international student market and the establishment of a distance learning programme with an external partner, who received a substantial portion of the profits. Fanning stated that the current financial state has highlighted flawed business decisions made within the University, with its “reactive” decisions as a reaction to the success of other institutions, such as the distance learning programme being adopted after Exeter’s.

A University of York spokesperson has said “we recognise this is a difficult and unsettling time, but we aim to protect as many jobs as possible and return to a surplus, so that we can continue to protect our position as one of the UK’s top performing universities.”