University continues to run massive surpluses to help fund campus redevelopment

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FoggyUni

Fraser McGowan
Editor

The University of Glasgow will run a surplus every year until at least 2019 in order to be “at a level that would enable the planned £775m investment in the estate over the next 10 years”.

Minutes from a meeting of the University Court, which took place in June, show that between the financial years 2015-16 and 2018-19, the University will have accumulated a management accounting surplus of £69.8 million, which equates to a statutory accounting surplus of £65.9 million. This amounts to approximately nine per cent of the total amount of money that will be invested in the campus redevelopment.

According to the minutes, surpluses are “achievable through modest growth in international student numbers, the implementation of a premium-fee policy for popular courses, growth in contribution from research and commercial activity, and control of costs”.

Risks and challenges to the forecast include “overseas student demand; UK Visas and Immigration issues; changes in England and rUK demand; cuts in overall SFC [Scottish Funding Council] budget after the 2015 Comprehensive Spending Review; cuts in, and refocusing of, RCUK [Research Councils UK] resources after the 2015 comprehensive spending review; potential exit from the EU; and funding the estates development”.

A University of Glasgow spokesperson said: “The University budgets to run a surplus every year, and the main reason for doing this is that it provides money to invest in improving the campus. When the University Court approved a funding package for the Campus Estates Strategy in February 2015, it was therefore able to plan to fund most of the investment through historic and future surpluses.”

The level of investment planned in new teaching and research facilities is £450 million. The Glasgow Guardian understands that £150 million will come from surpluses generated in recent years; £100 million will come from surpluses generated in the next decade; £100 million will be borrowed; £50 million will be generated from property sales; and £50 million will be raised from fundraising.