Vice-Chancellor's Update: This Year's Budget

Dear Colleagues,

Later this week, industrial action will be taking place at universities right across the country as part of the University & College Union’s national dispute. Given we can expect widespread discussion around this both in the media and elsewhere, I wanted to give an update on our approach to this. There are also a few other developments to bring to your attention by way of a follow-up to my last update on 3 November.

Industrial Action

Pay, pensions and working conditions are important topics and we all want a sector where staff are well rewarded for their hard work. While decisions are taken nationally, we have made good progress at Kent in a number of related areas through working together. We remain committed to engaging fully in national discussions and debates about these issues, striving to achieve a balance between ensuring appropriate reward for the great work delivered by all staff and sustainability for institutions. I am now on the board of UUK and UCEA and will play my part in seeking to achieve that balance.

As a University our focus is on working with our staff and mitigating the impact on our students as far as we can. We have set out our principles in responding to industrial action, including that any money saved through withheld salaries of striking staff will be reinvested in the student experience. HR have also put together guidance for those looking to take strike action.

Our 2022/23 budget

We are currently in the process of signing off our 2021/22 accounts, which achieved the planned deficit of £10.6m we set out as part of our return to sustainability, while investing in areas that support us in the future. Many university accounts this year will also include the finalisation of the USS pension valuation from 2020, adding a significant extra ‘deficit’ – to be clear, this is an accounting measure and does not affect us in terms of the underlying position.

For 2022/23 we had set a broadly break-even budget. This is now being looked at again given the emerging issues I updated on recently in relation to returning students. While we won’t have the final picture until early December, this has impacted us significantly and we are taking action now to address the in-year financial gap it creates. This includes tighter controls on staff recruitment, pulling back on capital spend and reducing our non-pay spend.

Our improved underlying position means that, while difficult, we are better able to manage a bump in the road like this. However, we have never seen attrition to this extent before and it is crucial we address it. I have asked Richard Reece to lead a group focusing on continuation and retention to ensure we understand and minimise this issue in future. We will also gather input through our senior leaders group on what else we should be doing.

Looking ahead

In relation to recruitment, while we have broadly met our income targets for new starts, this was assisted by international postgraduates who are with us for just one year. However we have not recruited as many home undergraduate students as we wanted, which unfortunately has a three-year adverse financial impact. Combined with the increasing numbers of non-returners this year, our overall student population is shrinking which impacts our income negatively.

My focus remains on turning this around to ensure we get back to steady growth and a good mix across home, international, undergraduate and postgraduate students. We also need to build our apprenticeship programmes, develop and continue to improve our overall course offer, and target a strong NSS this year to help improve our league table position. These will all help to generate resources to invest in our future.

The excellent REF 21 result, ensuring the right balance of programmes and having appropriate cost controls all help here. I am acutely aware as well of workload and system issues, plus the uncertainty out in the wider world right now. I am committed to working systematically to address these issues, as well as trying to reduce uncertainty by protecting the jobs of those who are already with us. I am also focussed on keeping you informed – last week we had our first Community Catch-Up of the term on measures to help with the Cost of Living, and there will be more in the new year.

I hope this helps in terms of an update on our current position and why we are taking the actions we are taking. Finally, on a personal note I will not be around on campus for a couple of weeks as I am having some hospital treatment. I hope to be back on campus mid December, and during this period EG members will covering for me as needed.

Yours sincerely

Karen

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