President's weekly update
4 June 2020
A significant part of our Senate meeting was devoted to discussing how we can mitigate against the financial impacts of COVID-19 due to the likely loss of international students in the next academic year. An article in WonkHE summarises the problems facing the university sector and the areas where savings could be made. As indicated previously, we will not know about student recruitment until the autumn, but we, like most other universities are predicting at least a 50% reduction in international students, which will have a major impact on our income. We also expect a drop in EU students but we may be able to make this up with recruitment of UK students. We are taking actions now in order to limit the scale of what we may have to do in the next academic year. We have now received details of our cap on home/EU students under the temporary number control and are most likely to bid for some additional places.
We discussed our ‘reserves’, which as reported in our financial statements include our buildings, land, equipment, artworks etc. Available cash reserves are limited and our Board requires us to retain 45 days operating costs as cash, which means that we cannot use reserves to meet any financial shortfall. We also discussed the current reductions in non-pay costs, some of which are deferring costs into later years: for example, deferred capital and long-term maintenance and which will also likely cost us more later. We are pursuing short-term loans, though these will need to be paid back.
I summarised the key priorities to help mitigate the financial impacts to be: strengthening student recruitment, maximising voluntary pay savings and securing government support. I have spent a significant part of the last week in discussions about potential government support for universities since it is recognised that research has been increasingly underfunded and there is a big gap in full economic costs which have to be met from universities’ other funds.
Senate also agreed the new dates for the next academic year, though noting that we will all have to be agile and flexible given the many uncertainties ahead. There will be a need for some local adaptation, within the key fixed points that have been agreed on start dates for different student groups, vacations, induction and overall teaching periods.
After careful consideration, we have announced that we will proceed with promotion, re-zoning and re-grading of staff, but any pay uplift effective from now (for applications received after 17 March) associated with promotion, regrading or rezoning is being put on hold for a year in the first instance. The associated pay uplift will not be made this time due to the financial pressures we are facing. This will be reviewed regularly. It is really important to recognise and reward staff for their contribution and I am sorry that we are unable to do so monetarily at the present time.
A number of staff have submitted applications for voluntary severance or reduced working hours and some have offered reduced salary on the same working hours or donated to the University which are incredibly welcome. Today, I received the wonderful news that our Emergency Student Hardship Fund has now surpassed its £1 million target. I am deeply grateful to everyone who has contributed. If you would like to donate to support students facing hardship please do so, or you can choose to support our University’s research into COVID-19, or make a gift to another University cause that you care about most.
A central issue that we care deeply about as a University community is equality, diversity and inclusion. Concerns about this are heightened at the current time with events in the United States. No one should ever feel discriminated against at The University of Manchester and we have reiterated our commitment to zero tolerance in a public statement.
I took part in a panel hosted by NESTA, an innovation foundation, to discuss a recent report by Professor Richard Jones, who joined us a few months ago, and Tom Forth from ODI Leeds on the imbalance in research funding across many UK regions including the North West, and how a better balance could help to reduce social and economic inequalities.
We held a joint meeting with leaders in Greater Manchester (GM) Combined Authority to discuss reopening businesses and recovery, including transport and promoting Greater Manchester to visitors and students. Further information on the next phases of our reopening has been published and we expect some research labs to open, with social distancing and new protocol in the next week.
Nancy Rothwell, President and Vice-Chancellor