Anton Muscatelli: Staff cost cuts may be ‘inevitable’

Adam Campbell

University of Glasgow Principal, Anton Muscatelli, has stated that staff cost cuts will be inevitable if cuts to higher education continue as predicted.

The Principal had previously stated that the University is likely to enoucnter a £35 million budget black hole unless “corrective action” is taken, leading to concerns amongst the Glasgow University student body about the future of the university, particularly with regards to how well the institution will be staffed.

In an interview with the Guardian, Muscatelli stated that ‘60% of [the University’s] costs are staff costs and inevitably reduction costs will reflect that’. The statement is likely to raise hightened concerns about job losses, following previous attempts by senior management to force staff redundancies in some academic departments.

He also refused to rule out course culls in the coming months, although promised that anybody already enrolled in a course would not have their degree terminated if a department was scheduled to face the axe.

Since becoming Principal in 2009, Muscatelli has overseen a controversial restucture of the university’s academic framework. He has stated a belief in graduate contribution for students, based on a progressive payment model in which graduates earning higher amounts would pay more.

This is in constrast to the pro-fees stance held by the Russell Group of research universities, of which Glasgow University is a member.

Interview in full:

Do you believe the case has been made for the government’s program of cuts, particularly to higher education funding and the Scottish Government’s budget?
If you look at the UK Government Spending Review I think arguably some of the cuts in higher education are far too deep and in England I am very concerned by some of the moves to remove public funding for areas like arts, humanities and social sciences. That’s why whenever we have discussed the possibility of a distinct Scottish solution I think it will need to be different.
As for, as an economist, whether the fiscal cuts have been too far, too deep, I think the jury’s out on that. I think there is a substantial risk, that by trying to fix the UK’s position over one parliament the economy might weaken and I think the government will probably need to have a look about in the next six to twelve months to make sure that as far as the economy is concerned these cuts have not gone too far.

You have stated before that the University of Glasgow would run out of money in three years, unless “corrective action” was taken. How will this action impact on students and the education that they receive, for example would courses be closed? Would there be staff redundancies involved?
What you saw in the press was an exaggeration and some of the figures were accurate, but it was quoting them in isolation. The figures came out of a Court Strategy Paper which basically said if the cuts are going to be in the order of 20-25% of real income in the next four years, and public funding by 80[%] and if we did nothing then we would run into deficit. That’s not an entirely surprising statement, every university would be in that position. But if these are the sort of cuts that we face and there isn’t a Scottish solution then what Court has deliberated is that we will need to find and generate more income but also reduce costs and, if we do have to reduce costs by that amount and there isn’t a Scottish solution, then that’s concerning because 60% of our costs are staff costs and inevitably reduction costs will reflect that.

Concerns have been raised in the past about the levels of executive pay. If there were to be redundancies would they be across all levels?
If there is a reduction in staff costs, by definition we mean to look at all areas of spending. You asked in the previous question about student experience, and I suppose just to conclude on that, we are reasonably proud of the student experience that we offer in Glasgow. So whatever we do, we need to make sure that it doesn’t negatively impact on that and we would need to reduce costs but we are looking at all ways of doing it in a way that doesn’t impact on the student experience and we would work very closely with the student organisations to ensure that the student voice was heard.
But if we are looking at reductions in staffing costs of course we are looking at all levels and indeed part of the restructuring that we took place, although this was well before the cuts and wasn’t linked to any of it, cost reductions was actually reducing the number of management positions in the university and we now have a smaller senior management team now than we had a year ago and we have a smaller management structure.

You mentioned the restructure there, one of the aims of that was to increase interdisciplinary research, which would in turn increase the university’s income. How long do you think it will be before we see the benefits of that?
We always thought, before we started this, that we would begin to see activity almost right away. If you look at our colleges we are beginning to see collaborative research across previous faculty boundaries and new research happening. There are inevitable lags because if you look at research funders, for most of them it takes between a few months and a year to consider applications. In terms of being able to maintain or grow our position, and our target in our strategic plan is to maintain our relative position in the Russell Group funding over the next few years, we will begin to see a difference in the next couple of years.

When can we expect an announcement on the nature of the university’s saving plans?
The University Court has asked us to come back with a plan by February, by then we will also know more clearly what the Scottish Government plans to do. We’re waiting, literally over the next week or two, to see what the Scottish Government will do about higher education. And once we know that, that’ll give us some clarity. What we won’t know, and we probably won’t know until the election, is will there be a Scottish solution, will there be an alternative to Browne in Scotland. So we are going to have to plan over the next few months without knowing what that Scottish Solution might look like and so whatever plan we come up with, will need to be flexible because if suddenly in May 2011 we have a Scottish solution or summer next year a Scottish solution, we would need to adapt.

What is the university’s position on the Browne Review Proposals?
Well officially we don’t have a position because it doesn’t impact directly on us. I have said throughout that a Scottish solution has to adhere to the following principles, no upfront tuition fees and students don’t pay, at most it would be graduates who would make a contribution towards higher education after they graduate and after they see some of the benefits of having a degree. It has to be, therefore, linked to earnings and therefore ability to pay, it has to be progressive, it has to not discourage access to higher education and therefore some of it is going to come back into student support. And finally I think there has to be the right balance between public and private funding.
My view is that Browne’s proposals go too far in putting the balance on the individual, because there is still a public benefit of higher education and I have always said that throughout my preferred solution is 100% public funding for education and it’s always been that. I need to ensure that the student experience that we offer in Glasgow is comparable to what is offered elsewhere in the UK and indeed elsewhere in the world. So we need to find a solution that meets those demands, that is fairly shared between public purse and private contributions.

Do you think in light of the Browne Review the university is likely to see an increase in the number of English and Welsh students applying?
To be honest I think that is a possibility, but that depends largely on what the Scottish Government decides in terms of fees for rest of UK students and that is not a Glasgow decision, that is a Scottish Government decision. At the moment, even with the current system in England, we, the Scottish universities, will charge some fees to the rest of UK students coming top study in Scotland. I expect that if the UK Coalition government’s response to Browne is actually enacted in Parliament in Westminster, what we would find is that the Scottish Government will introduce higher levels of fees for rest of UK students because, perhaps what we’ll see is a huge rise in applications from across the border.

You have mentioned that Glasgow is in a better financial situation than other Scottish universities. Could you outline how that is the case?
Well in two respects we are in a better position. First of all for the last five years we have been running an operating surplus and we have to run a surplus because, we use this surplus to reinvest in IT equipment, and refurbishment of premises and important areas like the library and lecture theatres. But we are in a position where we have run a surplus and, therefore, we are able to maintain our cash position in a healthy state. We have a healthy positive cash position, we have no long term debt.
But having said that, what the projections that we discussed earlier show is that if you can’t just use that to prop up cuts in spending in public funding because that cash will run out in a year or two. What it means is that we have got a little bit of time, which compares to other UK universities, they start with long term debt, they start with low cash positions and they certainly would have to take immediate decisions, we have a slight luxury which is that it gives us a bit more time to make the right decisions as far as our shape going forward is.

What do you think the main concerns that the university will be facing with the Scottish Parliament elections next year?
I think our main concerns will be to ensure that whichever government emerges from the Scottish elections they are committed to finding a Scottish Solution to the funding problem of higher education. We need a solution that will last the test of time which means we can plan for the future and develop our universities. The universities are Scotland’s biggest asset. For every pound that the Scottish Government spends on our universities, we bring in an additional pound to the Scottish economy through research funding from outside Scotland and through international students who choose to live in Scotland, so we would argue that we need to find a solution.


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