UCU: Universities’ income and reserves increase as proportion spent on staff falls again

·         Proportion of expenditure on staff drops to lowest ever figure and is 6.54% lower than 2009/10

·         Capital expenditure hit new high in 2016/17 and is up by 34.90% compared to 2009/10

·         Universities’ total reserves have more than tripled to £44.27bn in just seven years

UK universities’ income increased by £915m (2.7%) between 2015/16 and 2016/17, according to figures published today (Thursday). During that time they made a surplus of £2.3bn and now have total reserves of £44.27bn – up from £12.33bn in 2009/10.

The data from the Higher Education Statistics Agency (HESA) revealed huge increases in capital expenditure, but also that the proportion of money spent on staff dropped to a new low of 52.9%. While the percentage of expenditure spent on staff has fallen by 6.54% in the past seven years, the percentage spent on capital expenditure has shot up by 34.9% over that period.

2016/17 key findings (see table below for figures since 2009/10):

·         Total income increased by £915m (2.7%) and now stands at £35.7bn

·         Surplus for the year is £2.3bn – which is 6.4% of income

·         Income from tuition fees increased by £931m (5.5%)

·         Net current assets up by 8.6% (£551m) to £6.8bn across the sector

·         Unrestricted income and expenditure reserves increased by £3bn (10.7%) to £31.6bn total

·         Total reserves of £44.27bn – up from £12.33bn in 2009/10

The University and College Union (UCU), which is currently in pay talks with universities’ representatives, said the figures made a mockery of universities’ claims that staff were a top priority. Staff in universities have seen their pay fall by around 20% since 2009, while university leaders’ pay and perks have gone largely unchecked.

The union said that the figures also suggested universities paid no attention to what students wanted most from their education, as they have called for investment in staff over buildings*.

UCU general secretary Sally Hunt said: ‘With capital expenditure shooting up and staff costs down to a new low, it is clear that universities are prioritising investment in buildings over their staff. This makes a mockery of claims that staff are a top priority and also suggests they ignore what students say they want.

‘While universities’ income rises and they hoard huge reserves, it seems the only people to benefit are vice-chancellors whose pay and perks have long been a source of embarrassment for higher education. The time has come to address the fall in staff pay and we hope the universities will respond positively at next month’s pay talks.’

* See page 48 which says the top three ways universities should save money according to students are:
1 Spend less on buildings
2 Spend less on sports/social facilities
3 Increase class sizes.

Similarly, the three most unpopular options are:
1 Reduce spending on student support services
2 Fewer hours of teaching
3 Reduce spending on learning facilities