Russell Group head: too many new levies to hit universities

Elite universities are unhappy that new rules targeting charities and big business will hit institutions hard, says Wendy Piatt

March 25, 2016
Wendy Piatt, Russell Group
Source: Alamy

Vice-chancellors are growing frustrated by the “flurry” of new government levies that will substantially increase university running costs, the head of the Russell Group has said.

Wendy Piatt (pictured), director general of the mission group representing 24 research-intensive universities, said that there is also considerable unhappiness that higher education institutions’ fundraising efforts would soon be restricted by new rules aimed at cracking down on unethical practices in the charitable sector.

“We feel quite exasperated by this and are pushing to be exempted,” Dr Piatt told an audience at the Association of University Administrators’ annual conference in Leeds on 22 March.

As large charities, universities will soon fall under the remit of a new regulator introduced in the wake of scandals exposed last summer regarding aggressive fundraising practices.

Those charities, including universities, that spend more than £100,000 a year on fundraising will have to pay a levy to finance the new Fundraising Regulator.

Dr Piatt said that it was unfair that universities had been “dragged into regulation that covers charities”.

Efforts by universities to build lifelong relationships with their alumni should not be viewed in the same way as begging letters sent by charities or aggressive cold-calling methods employed in some cases.

Asking a graduate to contribute to their alma mater represented an “entirely different relationship to cold-calling”, claimed Dr Piatt, saying that the rules were a “major threat to an income stream” for universities.

“The irony is that successive governments have encouraged us to diversify sources of income so we do not depend on the state, including encouraging us to build a relationship with alumni,” she added.

Universities will also have to pay a new apprenticeship levy that requires all employers with a salary bill in excess of £3 million to contribute to a new training fund from April 2017, Dr Piatt said.

“That is 0.5 per cent of payroll,” she explained.

New proposals to stop organisations using state funds to lobby the government may also have a negative impact on universities, she said.

However, the “flurry of levies and additional charges” due to be imposed on universities is unlikely to include the proposed £1,000 annual levy on employers who use skilled workers from outside the European Union, Dr Piatt said.

“We have been led to believe from comments in Parliament that the levy will not be charged on employees who have a PhD qualification,” she said.

“That would be a big relief,” added Dr Piatt, saying that similar levies on overseas workers introduced in other countries had generally sought to remove staff with doctoral qualifications from restrictions.

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