Luton - a cut both ways

April 19, 2002

Despite impressive statistics for graduate recruitment and widening participation, Luton is facing a huge funding cut. Claire Sanders looks at its options

Overseas applications to Luton University are up 30 per cent this year, with much of the increase coming from China. The university tops graduate employment tables. And it is hugely successful in raising money from business and the local region.

These are just a few of the statistics Luton is keen to present, showing that on almost every government priority it is performing well.

And yet the university faces the biggest percentage cut in funding of any university this year - 7.5 per cent in real terms. Applications from home students are down 12 per cent, according to the university, and last year it under-recruited by 23 per cent. The financial penalties have been immediate and heavy.

Luton has already shed 60 jobs and has set up a voluntary redundancy scheme to deal with any more. But restructuring money that the university hoped might come from the Higher Education Funding Council for England has not materialised.

This week, 17 former Luton academics signed a letter to The THES . "We are gravely concerned about the management of our former university," they write. The letter calls for an inquiry into the management style at Luton by Hefce and the Department for Education and Skills, and calls for the suspension of the vice-chancellor and his two deputies pending the outcome. It says that the large management team has so far avoided redundancies and calls for a "strategy to be put in place to secure the future of the remaining students and staff, if necessary in a different organisation".

Vice-chancellor Dai John has been quick to quash rumours of a merger with the University of Hertfordshire.

"We are concerned about our situation but have taken measures to ensure survival," said pro vice-chancellor Tim Boatswain. "We have planned for a worst-case scenario but it is difficult as so many elements of our funding are unstable and unpredictable. It is hard to predict student numbers. We are allocated money annually and yet have to make a three-year commitment to students."

A spokesperson for Luton said this week that no inquiry was planned and that the management team at Luton was not large, So far there have not been redundancies at management level.

The lecturers' union is angry. Jenny Golden, regional officer for Natfhe, said: "Luton was originally a college of higher and further education, exactly the model the government wants to see back in favour. And yet the funding system works against the university, and academics are being thrown onto the unemployment scrapheap."

Sitting in the Edwardian building of the university's Putteridge Bury campus, a leafy site just outside the busy town, Professor Boatswain lists Luton's achievements.

He said:"On widening participation we do well - 99 per cent of our students come from state schools." Half of Luton's students are over 24 when they join and many come with non-traditional qualifications. "In many countries, universities are judged on what their graduates do, not the qualifications they arrive with," Professor Boatswain said. "We take a similar approach."

The university does not have a high dropout rate. It is above the benchmark set in Hefce's performance indicators.

It also has a good racial mix, partly reflecting Luton itself as well as its strong overseas contingent that makes up a quarter of its students, with more than 110 countries represented.

"It makes our courses very exciting," Frank Burdett, director of commercial affairs at the university, said. "We have Chinese students next to local Asian students as well as white working-class students. They learn a lot from each other."

Luton likes to use the slogan "Education that works". It has topped newspaper league tables of graduate employment based on Hefce performance indicators.

"Those tables received a lot of coverage in the Chinese press and we think that accounts for the increase in Chinese applicants," Professor Boatswain said.

Luton believes its graduates are employable because its courses are so vocational. "Before our 2001 funding allocation, we had already produced a restructuring plan in which we focused on our vocational strengths," Professor Boatswain said. Luton dropped humanities courses such as history and English and focused instead on its vocational courses, particularly business and media studies. "There is just no point in a university like ours trying to compete with older universities on more traditional courses, particularly in the humanities," he said.

Many new universities fear that after Hefce's failure to fund the research assessment exercise in full, older universities are going to pack in the humanities students to boost income. "That will be disastrous for many new universities," Professor Boatswain said.

He added that although applications to Luton were down this year, the conversion rate - of applicants to accepted students - was higher than last year. "We've stuck with the courses for which the conversion rate has always been high, and dropped those for which it has traditionally been low, so we expected that," he said. "If the university carries on converting applications to acceptances at the current rate, then we will be OK."

There is also a lot of anger at the government's delay in producing its student funding review. "Poorer students are seriously concerned about debt, and we fear many will delay applying while student funding is under review," he said.

Luton's proudly vocational approach means that it is one of the best examples in the country of a university exploiting "third-leg" funding. This is money from business that Hefce chief executive Sir Howard Newby has stressed is crucial for the future.

"We bring in about £5 million a year through our commercial work," Dr Burdett said. "That is about 10 per cent of the university's income. The growth has been phenomenal. A few years ago the figure was measured in hundreds of thousands."

In the recent round of bids to Hefce's Higher Education Innovation Fund, Luton achieved the second highest outcome. Part of the sum, £843,000, was for the establishment of a knowledge hub, or one-stop-shop for businesses, which the university launched last week.

"We want to ensure that it is easy for businesses to contact us and to draw on all our resources," Dr Burdett said. "Many of the senior managers we deal with do not have degrees, and the university can appear alien."

The university was also a successful partner in a joint bid from eight local universities for £4.5 million to create an "infrastructure for innovation". "A business in King's Lynn must be able to draw on our resources and not just on those of the nearest university," Dr Burdett said. "The infrastructure will enable each university's strengths to be available regionally."

The university is successful at working with small businesses. "Many of our partners in the infrastructure bid have talked of the difficulty of working with small businesses, but we have been very successful in this area, using European money to fund courses."

The university has worked with more than 3,000 staff from small businesses, representing about 1,500 companies. "Small businesses are notoriously squeezed for cash and yet many of them now have websites that are bringing in European business. Our language and culture for business course, funded through the European Union, has been free to users and proved very popular," Dr Burdett said.

Building on the success of this, Luton has started a languages for e-business course. "We help businesses design their websites for European customers and offer a translation service where necessary," he said.

The loss of nearly 2,000 jobs when Vauxhall closed its car production plant earlier this year has been a setback for the university, but not one that has devastated it.

"We had about 800 Vauxhall employees studying through our Guidelines project at the plant," Dr Burdett said. "But many of these were at further education level and did not represent a direct loss for us. Many of the employees have moved to neighbouring plants and the new employer has picked up the cost of their university studies."

The loss of Vauxhall was a blow in emotional as well as employment terms. The university has been carrying out a study for the East of England Development Agency on the impact of Vauxhall's departure on the supply chain. "We have found the impact to be significant and are working with the EEDA to offer these people support as well as those made redundant by Vauxhall," Dr Burdett said.

Luton Airport is now the biggest employer in Luton, creating 8,000 jobs. "We run management courses for easyJet," Dr Burdett said. "We have proved ourselves very flexible and our work with that company is growing."

Luton's faculty of health and social sciences is also crucial for the university's future. A fifth of the university's income comes from the Department of Health. Kate Robinson, deputy vice-chancellor and former dean of the faculty, said: "We've been negotiating with local businesses, in the form of National Health Service trusts, for years. This gives us strong local links that those keen to promote third-leg funding could learn from."

Professor Boatswain said: "But even on this front we are penalised. We have to negotiate contracts with trusts that push down the unit of funding, and the DoH is notorious for not paying overheads on research projects. From our point of view that is serious and from the taxpayer's point of view pointless. For a university like Luton there is a mismatch between government funding and rhetoric," he said.

Dr Burdett summed up much of the frustration at the university. "We are doing so many of the things the government wants us to do and yet have to struggle for every penny. Just give us the money and we will multiply it tenfold," he said.

Luton facts

* It became a university in 1993, has 13,300 students and 700 academic staff

* It scored six "excellents" (a point score of 22 or above out of 24) in the last six teaching quality assessments by the Quality Assurance Agency

* 70 per cent of staff reviewed in the 2001 research assessment exercise were rated as having national or international standing

* It was the first university to offer a skills profile of its graduates

* Ninety-eight per cent of graduates are employed within six months of leaving

* Some 99 per cent of its students are from state schools

* The funding cut could amount to a loss of £3 million; the university has already lost 60 staff.

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