Appetite for construction: finance directors ready to spend

Nearly half of all university finance directors believe now is a good time to be taking “greater risk” onto their balance sheets, according to a survey by consultants Deloitte.

August 19, 2013

While some are adopting a “wait and see” approach towards the new, more competitive student recruitment system, others are looking to borrow money to improve the student experience and finance a growth in numbers.

Forty-seven per cent say now is a good time to take risk onto their balance sheets.

The Higher Education Finance Directors Survey reports that many of those surveyed said their universities needed to “invest considerably in order to maintain their competitive position”.

Another reason for this appetite for risk is the declining cost of credit, the report says.

One third of the 35 respondents said that their university’s level of financial risk had “increased somewhat” in the last year while 6 per cent responded that it had “increased significantly”, although half said that risk levels were the same.

Risk factors include an increase in a university’s ratio of debt to capital or “uncertainty” about the value of its assets.

Asked what areas of expenditure would increase or decrease, the majority of finance directors expected spending on hiring to shrink.

A majority also expected the amount of bank borrowing and bond issuance to grow.

The impact of the coalition’s tougher immigration rules is also being felt in the recruitment of international students, the survey suggests. Close to half of institutions said that changes in government policy had had a “somewhat” negative effect on their numbers from overseas in 2012-13.

Overall, more than nine in ten finance directors said that their institution faces an above average amount of uncertainty.

Julie Mercer, head of education consulting at Deloitte, said: “While uncertainty still remains, there are now signs of a shift. Expansion, and how to fund it, is now a big priority for higher education.”

She added: “Capital expenditure is needed to underpin the expansion of student numbers, support research, meet the demands of the 21st century learning environment and compete in an increasingly global higher education sector.”

You've reached your article limit.

Register to continue

Registration is free and only takes a moment. Once registered you can read a total of 3 articles each month, plus:

  • Sign up for the editor's highlights
  • Receive World University Rankings news first
  • Get job alerts, shortlist jobs and save job searches
  • Participate in reader discussions and post comments

Have your say

Log in or register to post comments

Featured Jobs

Most Commented

Monster behind man at desk

Despite all that’s been done to improve doctoral study, horror stories keep coming. Here three students relate PhD nightmares while two academics advise on how to ensure a successful supervision

Sir Christopher Snowden, former Universities UK president, attacks ratings in wake of Southampton’s bronze award

opinion illustration

Eliminating cheating services, even if it were possible, would do nothing to address students’ and universities’ lack of interest in learning, says Stuart Macdonald

Female professor

New data show proportion of professors who are women has declined at some institutions

celebrate, cheer, tef results

Emilie Murphy calls on those who challenged the teaching excellence framework methodology in the past to stop sharing their university ratings with pride