Universities ‘worse than bankers’

Civil servant appeals for further savings to avoid another round of government cuts

April 2, 2015

Source: Corbis

Cosy: some politicians say universities are ‘not living in the real world’

Universities are viewed by many politicians as overstaffed and largely untouched by public spending reductions, a senior civil servant has warned.

Jeremy Clayton, director of knowledge and innovation strategy and international at the Department for Business, Innovation and Skills, said that higher education had also been criticised for having too many excessively paid employees and was seen as a sector ripe for cuts despite having achieved efficiency savings worth £1 billion over the past three years.

“I have heard politicians from across the political spectrum say that universities are feather-bedded, worse than bankers and just not living in the real world,” Mr Clayton told a Universities UK event on efficiency on 25 March.

Universities needed to redouble their efforts to find savings to combat this damaging perception – otherwise they could suffer large cuts in a post-election spending review, he said.

“Unless we take this [efficiency] agenda seriously, this perception can become a reality in terms of government policy,” he said.

It was also a mistake for some to claim that the efficiency agenda was “running out of road” given the substantial slimming-down achieved, particularly in the science and research budget.

However, Sir Ian Diamond, principal and vice-chancellor of the University of Aberdeen, warned that it may be difficult to ask universities to find more savings in research than those already requested.

According to the latest Universities UK review on efficiency led by Sir Ian, which was published in February, institutions had achieved efficiencies related to research totalling nearly £200 million in the past three years and were on track to deliver a further £133 million of savings in 2014-15.

“I am not sure how much further the efficiencies can come in,” Sir Ian told the UUK conference.

Universities were already given less funding than the full cost of the research they undertook, so “we will have to find money from somewhere else” if further savings on research were required, he said.

That point was echoed by Bob Rabone, chief financial officer at the University of Sheffield, who said that universities received 35 per cent less than the actual cost of conducting research.

“For every pound for research that comes in, we spend almost half as much again,” said Mr Rabone.

That deficit on research had increased considerably since 2010, which meant that research was in effect subsidised by more profitable parts of university activity, such as teaching international students, which generated a 27 per cent surplus, he said.

Despite his scepticism over finding extra research savings, Sir Ian said that his report had identified scope for efficiencies in other areas, including estates, asset sharing and personnel. But his recommendations to find savings in staff costs, which make up about 55 per cent of total expenditure, were “not about cutting rewards”, he said.

While universities had to “show restraint in pay”, they also needed to “recruit and retain [staff] in a global market”, he said.

“We have to address issues of living wage, issues around zero-hours contracts and [have] non-exploitative contracts,” Sir Ian added.


Move over: cost benefits of sharing an office

Sharing offices has been identified as the “next step change” in the drive to cut the estimated £2 billion annual cost of managing university estates.

Ghazwa Alwani-Starr, director of estates and campus services at the University of Roehampton, who led work on space efficiency in the latest Universities UK review, said that more academics need to consider sharing office space with their peers.

At a UUK event on efficiency on 25 March, Ms Alwani-Starr said that the sector needed to consider why “university professors need X amount of space, even those who only come to the campus once a week”.

The latest UUK review had found “some really good ways of rearranging offices” and she believed that this was “the next step change in how we use space in universities”.

Ms Alwani-Starr, who is deputy chairwoman of the Association for University Directors of Estates, said that the open-plan office used by Loughborough University’s executive team showed that “vice-chancellors [can] lead by example”.

Bob Allison, vice-chancellor of Loughborough, told Times Higher Education that he was sceptical about the merits of sharing an office when he was appointed, but he is now a fan.

“All the problems I imagined, such as lack of space or privacy, have not arisen,” said Professor Allison. “I think the university genuinely benefits from the way we interact as a team – we are sharing information, but also understand more how each other thinks,” he added.

However, Ms Alwani-Starr said it was important that office sharing was introduced for “sound academic reasons”, rather than simply the desire to save money. Her comments follow findings in the UUK efficiency report that show that the average office space used by academics has fallen by just 0.5 per cent between 2003-04 and 2012-13.

In contrast, teaching space per student fell by nearly 17 per cent over this period and office space for support workers was down by 11 per cent.

Jack Grove

Times Higher Education free 30-day trial

Register to continue

Why register?

  • Registration is free and only takes a moment
  • Once registered, you can read 3 articles a month
  • Sign up for our newsletter
Please Login or Register to read this article.

Reader's comments (3)

There is an argument that universities are over 'studented' (if that's a word) rather than over staffed - given the immense competition for so few academic jobs.
'Jeremy Clayton, director of knowledge and innovation strategy and international ' There's a word missing at the end, right ? And what qualifies someone with this particular title and role to speak of 'efficiency' ? Bit vague too, isn't it ? Would any civil servant slag off any other set of enterprises that earned so much foreign exchange for UK plc ?
The overarching problem in HE is bad processes which create cost and quality problems. Good people are trapped in bad processes. Many UK HE institutions are doing nice work in applying Lean management to administrative processes. See http://www.leanhehub.ac.uk/. Greater attention should be paid to improving academic process as well. See http://www.leanprofessor.com/2015/04/07/how-to-get-started-with-lean-in-higher-ed/.


Featured jobs