UCL faces financial trouble after East London expansion
Michael Arthur said UCL was “barely financially sustainable”
UCL’s budget is under serious strain following heavy borrowing to fund a massive expansion in East London.
The provost, Michael Arthur, described UCL as being in a “barely financially stable position”.
Speaking in a meeting with over 200 UCL academics, Arthur said that UCL only had 42 days worth of expenditure – meaning that if all income were to stop, UCL could only afford to pay staff for another 42 days.
According to the Higher Education Funding Council, the average for UK universities is 93 days of expenditure in 2015/16.
Despite a salary of just under £360,000 Michael Arthur urged faculties to scrimp and save in order to run a larger surplus on their budgets. UCL currently runs an annual surplus of just 3.5 per cent – King’s is well in excess of 8.5 per cent.
This comes just months after UCL signed a £280m loan – the biggest ever taken out by a UK university – in order to fund both the construction of a new campus in Stratford and to upgrade facilities on the Bloomsbury campus.
Speaking to the Financial Times Phil Harding, the finance director, said that scrutiny of UCL funds was “a necessary and prudent step” and “is not driven by a concern regarding liquidity”.
Michael Arthur is also currently in the midst of two increasingly bitter financial rows with both staff and students. Academics are currently unhappy that UCL management are allegedly exerting greater control over £78m worth of “discretionary funds” – which are pooled from fees and used to fund PhD students amongst other things.
UCL senior management also met with members of UCL, Cut the Rent today in order to negotiate UCL rent setting policies.