University to make almost £100m in cuts

Coventry University said 'difficult decisions' would have to be made

Coventry University will make nearly £100m in cuts over the next two years.

The university's annual report said income for this financial year would be £85m less than forecast.

It added about £40m of savings would be needed in 23/24, with a further £55m in cuts expected in 24/25.

Asked if the move could spark job losses, a university spokesperson said it had significant reserves and assets but "difficult decisions" would have to be made.

One employee, who asked not to be named, told BBC News he was concerned about cuts to jobs and terms and conditions as a result of the anticipated savings.

He believed management had overseen a lack of planning and put unrealistic targets in place, adding an £85m shortfall does not just "spring up".

"I’m not seeing anybody ask - how did it get to this?" the staff member said.

Revenue growth

In its annual report the university said its revenue had grown 10% to about £500m in the financial year ending July 2023.

Bosses added rising costs had led to a small deficit of £2.4m, down from £32.9m the year before.

However, rising inflation means the deficit will increase again this year, with income for the year to July 2024 expected to be about £85m less than budgeted.

The shortfall is down to lower than expected student intake figures in Autumn 2023.

Leaders are also braced for arrival numbers to drop in January and May 2024.

The university's deficit declined in the last financial year - but it's expected to rise sharply once again

“Several factors, some beyond our control, mean we now forecast a larger deficit in this current financial year," a university spokesperson said.

"These funding issues are affecting most universities in the Midlands and England."

The higher education provider, which has more than 30,000 students at campuses in Coventry, London and Scarborough, will now seek to diversify income away from tuition fees.

International students have become more difficult to recruit and it is hoped money can be raised through teacher training, apprenticeships and industry development, leaders said.

The University says it has significant reserves and assets

When asked for its message to concerned staff, a University spokesperson said: "There will be some difficult decisions but we have significant reserves and assets.

"[This will] give us space to make the changes needed to build a financially sustainable future while continuing to improve services to our students and business and research partners."

'Crisis' in sector

Matthew Andrews, pro vice-chancellor at the University of Gloucestershire, said in August it seemed "undeniable that the higher education sector is facing a funding crisis".

Tuition fees have been frozen at up to £9,250 a year for undergraduates in England, and experts say this is now worth about £6,000 in real terms.

While no universities are calling for fees to rise, many lose money on UK undergraduates and rely on revenue from international students.

Coventry University said the UK government was making it harder to recruit overseas learners, forcing it to compete against the likes of Australia and Canada "who are more welcoming".

A Department for Education spokesperson said universities were independent from government but it had providing £750m in extra funding over three years to help them invest in facilities and offer quality courses.

The university's vice-chancellor, professor John Latham CBE, received an £80,768 bonus on top of his £312,617 salary in the 22/23 financial year.

“Staff bonuses are paid at all levels to those who are eligible throughout the Group and are, quite rightly, based on past performance not future financial forecasts," a spokesperson added.