New analysis by UCU reveals record university income as employers refuse to negotiate
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Income reaches new high of £44.6bn Bumper surplus of
£2.6bn & cash & liquid investment holdings of
£19.6bn Staff expenditure falls to record low Wealthy
universities devaluing degrees & threatening punitive pay
deductions of up to 100% in ongoing pay & conditions
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The University and College Union (UCU) today (Wednesday) slammed employers for formally refusing to negotiate in an ongoing pay and conditions dispute after new analysis showed employers can easily afford to make an improved pay offer. UK Universities generated more money than ever last year, yet staff expenditure has hit rock bottom, reveals new analysis from UCU [NOTE 1]. It shows the surplus universities generated could have raised staff pay by 10% with hundreds of millions to spare [NOTE 2]. UCU has examined the latest data from 147 universities and found the extent to which the sector is not only bringing in record income but hoarding billions of pounds more in cash. UCU’s detailed analysis of university finances found:
The analysis pulls apart employer body the Universities and Colleges Employers Association’s (UCEA) incorrect claims that the sector is unable to pay staff more [NOTE 4]. The employer body released its flawed analysis earlier this month, which wrongly said financial pressures meant universities could not pay staff properly. UCU also slammed UCEA for only raising financial pressures as a pretext for refusing to pay staff their fair share, whilst failing to lobby government for a better funding model. Russell Group, other pre-92 universities and post-92 universities all spent less on staff as a proportion of their income than the previous year. For Russell Group universities, which have the most wealth, the percentage spent on staff is even lower than average, with just 49.8% of income going to staff. The financial data covers the 2021/22 financial year, when RPI reached12.3% and UCEA imposed a pay award of only 1.5%. Since 2009, a series of low pay awards have seen staff wages fall 25% behind inflation and UCEA has now also begun imposing a sub-inflation award worth just 5% for 2022/23. UCU is demanding a better pay offer that helps its members meet the cost-of-living crisis. UCEA wrote to UCU last week to say it will not negotiate unless UCU calls off a marking and assessment boycott at 145 universities in the ongoing pay and conditions dispute [NOTE 5]. UCEA's failure to negotiate threatens to disrupt millions of exam results as well as the graduations of well over half a million students [NOTE 6]. Rather than use their wealth to pay staff fairly and settle the dispute, universities are threatening punitive pay deductions of up to 100% and trying to circumvent academic processes designed to uphold degree standards. Hundreds of academics have responded by raising concerns that degrees risk being devalued. MPs and Lords from across the political spectrum have written to UCEA and signed a Westminster parliamentary motion to tell the employer body to withdraw the pay deductions and settle the dispute. UCU general secretary Jo Grady said: ‘A national scandal is brewing that will see hundreds of thousands of students graduate with degrees not worth the paper they are written on, unless universities make staff a fair pay offer. With the employer body now refusing to negotiate students and their parents will rightly be furious.’ 'Our analysis shows the university sector is richer than ever, generating tens of billions of pounds in income and hoarding billions more in cash deposits. Yet universities are waging a war on staff and students by withholding the pay of staff engaged in the marking boycott and devaluing degrees.' ‘Meanwhile, the employer body UCEA is playing fast and loose with university balance sheets, and focusing on a small number of institutions to pretend it cannot afford to produce a fair pay offer whilst refusing to address the marketised system that creates winners and losers. ‘If vice-chancellors cared about staff and students, they would use the sector’s vast wealth to end this dispute tomorrow. Notes [1] The surplus/deficit and staff costs figures in this analysis are based on the Higher Education Statistics Agency (HESA) key financial indicators, 'Surplus/(deficit) excl. pension adjustment' and 'Staff costs excl. pension adjustment. These definitions exclude the movement in USS provisions and other pensions accounting adjustments that do not represent actual payments owed by providers to their pension scheme(s). The financial analysis is available here. The same definitions are used by the Office for Students in its reporting on the financial sustainability of higher education providers. [2] A 10% pay rise would cost £2.3bn and universities generated a total surplus of £2.6bn. [3] UCEA’s press release chose to include current service accounting charges for other defined benefit pension schemes in its deficit calculations. These charges are an accounting requirement but do not reflect the actual cash cost to an employer of providing pensions as determined by the relevant scheme. [4] 'The 'cash and short-term investments' figure includes employers' holdings of cash and highly liquid assets that are similar to cash and are expected to be converted into cash within the next 12 months.' [5] The full list of universities being hit with the marking boycott is available here. The dispute is over pay, workloads, job security and race, gender and disability pay gaps. UCEA has begun imposing a pay award of 5%. UCU is demanding a better pay offer that helps its members meet the cost-of-living crisis. [6] This is a conservative estimate based on the number of graduations in 2021/22, the most recent year that data is available for, at the 145 institutions faced with the marking and assessment boycott: post-grad 351,000, undergrad 478,000. The total number of students at the 145 institutions in 21/22 was: post-grad 741,000, undergrad: 1,867,000 |