On Monday 30 November the Vice Chancellor wrote to all staff. You can read the full email below:
As a big moment on our campus gets under way today, I want to update you on some of the discussions we had about the University’s future, at our most recent Council meeting (Friday 27 November). I shared this with more than 350 staff who joined the Open Forum this morning, and I want everyone to have full awareness of where we are at, and where we are going.
This is a longer email than usual but I encourage you to read to the end as it contains some important information.
First off, today marks the first day of our mass testing facility, set up to give students the reassurance that they are safe to return home for the winter vacation. Students are not required to get tested before they leave campus but their enthusiasm for the programme has been great and we have many hundreds booked to get tested every day.
The Spending Review:
Before I move onto other Sussex-focused matters, just a few words on the Government’s Spending Review, which was published last week.
There were a number of points of interest for universities, including nearly £15 billion of funding for R&D to help to make the UK a “scientific superpower”, and it was good to hear that negotiations are ongoing regarding future access to EU research funds, such as Horizon 2020. However, we need to be realistic about this: the likelihood that we will participate in the European research space on the same terms as we do now is low and it is more likely that alternative schemes will be developed.
There is still no definitive decision on a replacement for Erasmus+, should the UK decide not to participate in the future, but the Spending Review did reveal that funding has been provided to the Department for Education for this purpose. It’s also been encouraging to hear that UKRI have been exceptionally given a three-year settlement.
Until fairly recently, we had been expecting the Spending Review to respond formally – and finally – to the Augar Review (the 2018 review of funding for post-school education) but, again, this was the dog that didn’t bark. However, the Treasury has launched a review on the way that universities use student fees because there continues to be a sense in some circles in Whitehall that the sector is “awash with cash”. All previous reviews have shown this is not the case and I hope that this review reaches the same conclusions.
In the meantime, though, we can expect fees from UK students to remain unchanged for the time being and, allowing for inflation, this means that we have to work harder each year to generate the surpluses we need to invest properly in our university.
The previous year’s accounts:
If you are interested in the detail of this our annual financial statement, which will be available on the website shortly, sets out our accounts for the 2019-20 financial year.
When the pandemic first hit, we were really worried that we would make a loss last year, but a combination of growing confidence in the stock markets, and the emergency measures we took, led to a cash surplus of £12.7 million. Under accounting rules, the published accounts also show a pensions credit of £25.6m from USS but this is not ‘real money’ for us, just as the £40m pensions deficit in 2018-2019 did not unduly concern us.
The current picture:
Whilst last year had a good outcome, we are cautious about the position we find ourselves in. Our home student recruitment this year was healthy, but – like most universities – we have seen a significant reduction in international students studying this year. Although there is some uncertainty, because we have an unusual January entry point, it looks as if we will have 500 fewer international students this year and this will affect our finances for several years.
This is why we need to act now in order to avoid a downward spiral of fewer students, leading to less money to invest in our buildings, in our research infrastructure, in our people and in the student experience – all of which would risk our league table positions and applications further. With the right interventions however, we can break this cycle – and that is exactly what we discussed with our governing Council.
Why we need to return to a surplus:
Council set a broadly ‘break-even’ budget for this current year. Without action, next year looks tougher but Council has asked us to return to a healthier surplus for investment in 2021/22 of, at least, £5 – 10 million. This will require savings in the order of £15 – 20 million. This is not just a vague financial target, it is absolutely essential to our continued success as a university and our only way out of a vicious cycle of under-investment and under-achievement.
When you consider that we are an institution with a £170m staff pay bill and before the pandemic, had planned to make around £300m investment in making essential improvements in our Estates and IT infrastructure, the level of surplus we are looking to achieve is comparably small.
The good news is that we have shown in recent years that we can work together to find creative solutions to make savings of this magnitude. Indeed, we’ve already made significant savings since March, which have contributed to our better than expected, final financial position this past year. If we’ve done it before, we can do it again.
Immediate cost savings measures:
Again, I want to thank those of you who engaged in our recent poll that invited staff to provide feedback on potential cost savings measures that staff had put forward as ideas in workshops in the late summer. We had good engagement in the poll with more than 1,300 staff sharing their views. Some of the most popular things to come out of the poll, such as running another VS scheme, an annual leave purchase scheme and some other measures are being worked on and we will be able to give more details soon.
Alongside these, we will be looking at the longer term and will work with Schools and Professional Services divisions on a number of projects that all will contribute to delivering on Sussex 2025 and securing our financial sustainability. These include our integrated budget planning process (or IPBP); work on our refreshed academic vision; a review of our portfolio and curriculum; reinvigorating the One Professional Service project and revisiting our Sussex 2025 KPIs to make sure they are still steering us in the right direction. Most of these projects should be part of the normal cycle in a university but they are more relevant than ever this year. You will hear lots more about these in the coming weeks and months – and I will provide a lot more detail on all these areas in March next year, at the time of our next major discussions with Council.
Changes to UEG:
Today we have let all staff know that our PVC for Planning and Resources Stephen Shute will be ending his PVC tenure in September next year at which time he’ll be taking a sabbatical to focus on his work in criminal law and justice. Stephen will have served on the University’s executive for seven-and-a-half years and spent 12 years as part of Sussex’s leadership team. Stephen is a terrific colleague and I’d like to thank him for his dedicated service. Of course, as shared earlier in the autumn Provost Saul Becker leaves next year in April and we have recently welcomed our new PVC for Research and Enterprise, Keith Jones. You’ll also have read that our Council has approved a new role to replace the PVC Planning and Resources, one that will focus on Culture, Diversity and Inclusion.
To deliver cross-University solutions, we need a broad leadership. I mentioned in a previous ‘View’ that we would be bolstering the University’s Executive Group (UEG), to incorporate more academic representation from the Schools. I am pleased to report that Kate O’Riordan, Dean of the School of Media, Arts and Humanities, and Steve McGuire, Dean of the Business School, will be members of UEG from tomorrow. They will be joined by two other Heads of School, one from social sciences and one from the sciences, and we will announce the representatives as soon as possible.
Next calendar year:
Among our first challenges will be ensuring that we build on our first semester of delivering blended learning. Attention is already focusing on the second semester and we will shortly be sharing our approach with you and our students. As ever, this will be guided by the latest government and health guidance, as well as our own experiences. Our expectation is that we will continue to offer blended learning, in a model that takes into account the needs of our students and the circumstances of our staff.
Tied to this, we are expecting an announcement, possibly this week, about the Government’s plans for how students will return safely in January. We will communicate with you and our students once we know more.
Of course, we all hope that the prospect of a Covid-19 vaccine in the new year comes to fruition sooner rather than later. Thankfully, it is a very real hope, backed by science and discovery. As we juggle the many, varied challenges we face, this reminds us that universities are extraordinary places, full of extraordinary people, and we have it within us to get through this and emerge stronger the other side.
Many thanks for reading this far! I promise to carry on being as open and transparent with you as possible as we continue along this journey together.
With very best wishes,
Adam