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President's weekly update

16 July 2020

Senior colleagues and I have spent a great deal of time over recent weeks going through every budget from each part of the University in great detail. Planning our budgets for the next financial year (which starts on 1 August 2020) is particularly difficult as there is so much uncertainty, in particular we will not know about international student income until the very end of October when students make their payments. As previously set out in my messages, we have assumed that we will lose 50% of our international students and a significant part of our income from student residences, conferences and catering, resulting in a gap against our previous budget of about £160m. We are hopeful that we will meet targets for home students but acceptances from EU students are down, and competition for students will be fierce this year. This budget already had significant savings included in order to deliver our strategic plan. Some staff have asked that we deploy a ‘jobs first’ policy ie to limit any reduction in jobs. We are doing just that through various measures we have put in place and others under discussion with the trade unions.

As a brief update: we will get some financial support from government due to the loss of international students but we don’t have the details yet. We estimate that if we lose half our international students we might expect to receive a grant of about £20m and access to a government loan of up to £75m, but we have no confirmation of this as yet and the loan would, of course, have to be paid back at some point. Voluntary severance has attracted significant interest and we hope that this, together with a freeze on all but essential staff recruitment and a likely zero national pay award this year, could deliver £40m of savings next year. We are also very grateful to those staff that have taken a voluntary pay reduction and other measures that are helping to reduce our pay costs. After some difficult choices, we feel that we could make a saving on non-pay of at least £40m next year. Deferral of capital spending that is not already in contract and as much long-term maintenance as possible will help our cash position. We are seeking private loans but to secure these we need to demonstrate a credible recovery plan to pay them back. Taken together these savings and potential income from government and loans still leave a significant gap if the estimates of the loss of international students and other income transpires.

We have updated the Chairs of our Board Committees on our efforts in student recruitment, reopening of research facilities and on our projected financial position. They recognised that unless student recruitment is very much better than the current projections we face an extremely difficult and uncertain financial position.

The National Student Survey of student satisfaction results have been released. Our overall score is 81%, which has very likely been impacted by both industrial action and lockdown as a result of COVID-19, but is still disappointing as it is lower than the sector average of 83%. We will have further analysis of the satisfaction levels for each academic area in the near future.

At one of our regular meetings with Students’ Union Officers we discussed plans for teaching next year, provision for the safety of students and the Black Lives Matter campaign. This was the last meeting with the current officers who have completed their term, though the General Secretary, Kwame Kwarteng, has been re-elected for a further term.

I took part in an online event for some of our alumni and donors with Professor Brian Cox, hosted by Simon Collins, Chair of our Global Leadership Board. Brian and I answered questions on topics ranging from life in outer space, COVID-19, graphene and understanding the brain to our plans for welcoming students in the next academic year and the importance of discovering new knowledge.

You may have seen the media coverage that Marcus Rashford, Manchester United and England player has accepted the offer of an honorary degree from the University. Marcus, who is only 22, was born and brought up in Manchester. In addition to his football talents, he has raised a great deal of money for disadvantaged children and persuaded the government to offer free school meals throughout the holiday time.

Nancy Rothwell, President and Vice-Chancellor

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