Bethan Sayed AM calls for Welsh Government to take action to ensure the financial sustainability and good governance of universities in Wales
This article has been updated on 26 June
The serious financial crisis facing Wales’ higher education (HE) sector has caused significant job losses over the last twelve months and real concerns as to the financial sustainability of individual institutions.
The University of Wales Trinity Saint David, with campuses in Lampeter, Carmarthen, Swansea and Cardiff, has said it is looking at 110 potential job losses in a bid to save £6.5m. Its pro vice-chancellor for external engagement and sustainability told Carmarthenshire council the university was looking to take forward 170 redundancies, of which 70 were voluntary.
Cardiff University plans to cut 380 posts over five years. The university has a budget deficit of more than £20 million. The plans also include merging the School of Welsh with other departments that teach modern languages and literature.
Reports say that Aberystwyth University are looking at cutting 30 jobs at IBERS as part of ‘restructure plans.
Bangor University has already cut the Welsh language Chemistry degree course. It is currently in discussion with staff about further cuts. It has been reported that sixty jobs are under threat but unconfirmed by the university. However, eight roles will be cut from its Education and Human Development over the next three years. The university blamed a drop in student numbers, financial pressure and competition.
Staff in all of our HE institutions are under increasing pressure to fill in the gaps of lecturers and educators who have seen their positions disappear. All the while these job losses are happening against a backdrop of a massive gap in earnings between those in management at the top of these institutions and other staff. The average Vice-Chancellor salary is £254,000 – higher than the Prime Minister of the UK.
But this is not all. There are also serious issues with governance and accountability within Wales’ HE institutions.
Take Swansea University, for example. They suspended their vice chancellor and head of the School of Management, amid some controversy. Yet we have no clue what’s going on with the internal investigation. It also came to light that they were seven months late with their accounts – a new record for any university in England, Scotland and Wales.
Universities are also facing demographic challenges, with fewer Welsh students applying to attend Welsh universities and a decline – which is likely to get worse – of European Union students applying to come to Wales to study, too.
Brexit is going to be a serious deterrent to attracting people to come to the UK to study and work in our higher education sectors, and the short and longer term impacts that this could have on our economy is unfathomable. This doesn’t even include the loss of potential EU partnerships, such as Erasmus+ and Horizon 2020.
It’s pretty clear to me that there is a growing list of problems which has built up into a crisis for the HE sector in Wales. However, it seems that we have a Welsh Government and Education Minister in a state of increasing denial about these problems and they seem unprepared to engage with them.
The biggest argument the Welsh Government uses against taking direct action is that universities are “independent” and “entirely autonomous”. That’s not just misleading. It is plain wrong.
Universities in Wales receive public funding through The Higher Education Funding Council for Wales (HEFCW) – the Welsh Government Sponsored Body responsible for funding the higher education sector.
As a Welsh Government Sponsored Body, HEFCW receives its funds from and is directly accountable to the Welsh Government. HEFCW is also tasked with providing advice to the Welsh Government on the funding needs, aspirations and concerns of the higher education sector.
Universities are, of course, free to run their affairs as they see fit, but this must be within a framework set by the Welsh Government via HEFCW. The Education Minister has already set out how she wants universities to contribute to the Welsh Government’s civic mission, and universities are responding to the standard she has set for them. Why, then, can she not do the same in terms of the financial sustainability and good governance of universities?
Therefore it is simply not good enough for Welsh Government to wash their hands of this crisis. They have a direct responsibility to hold these institutions to account to ensure the governance process is adhered to appropriately and that money from HEFCW is being spent in the right way.
We need accountability and leadership. That leadership must come from the Welsh Government.
As a priority, Welsh Government must commission an urgent review of the financial sustainability of the Welsh university sector, in addition to ensuring the adequacy and transparency of university oversight and governance arrangements, especially in relation to the expenditure of public funds.
HEFCW should be tasked with an explicit mandate to intervene to prevent the bankruptcy of any higher education institution in Wales in the immediate future, by means of an emergency loan if necessary. The UK Government’s policy is that in the English higher education market, should a university ‘go to the wall’, then so be it. We need the Welsh Government to make absolutely clear that the economic, social, and education value of our universities is such that it would not allow that to happen here in Wales.
Furthermore, Welsh Government must remit HEFCW, and any successor body, to exercise a partnership approach with students and university staff at all levels of decision-making, and to require universities to take account of student and staff views in making staffing decisions. This is a very basic principle which universities largely exercise in academic matters, but the industrial action in the sector during the last couple of years showed the strength of feeling among staff and students on wider issues.
If the Welsh Government wants to differentiate the Welsh higher education sector from the increasingly marketised English sector, then there is a very clear need for students and staff to genuinely be partners at all levels and in all fora of decision-making in universities. This necessarily includes decisions relating to the staff and financial viability of institutions.
Furthermore, public funding from Welsh Government should be contingent on Vice-chancellors’ salaries not being more than five times median earnings. It is incomprehensible that universities should be considering laying off hundreds, if not thousands, of staff because of financial pressures while their Vice-chancellors enjoy average salaries of over £250,000. Such a situation sends a very unpalatable message about the value we place on university staff, and this is a space in which the Welsh Government really should be leading.
We can’t be in a situation in a few years’ time where a university collapses because of financial pressures, taking with it thousands of jobs and horribly impacting our economy, and we just “didn’t see it coming”.
Our universities are too important to be left to the unpredictable whims of the open market.
The knock-on effects of any university in Wales collapsing would be catastrophic. But that’s where we’re heading if the Welsh Government continue to bury its heads in the sand and refuse to exercise its ministerial responsibilities. It’s important to be clear that the Welsh Government’s hands are not tied; if it wanted to act, it could. What we are simply saying is that the crisis that is rapidly emerging in the sector means that it is time for the Welsh Government to act – now.
We’re not suggesting universities lose their autonomy. On the contrary, we want to see them flourish. But that requires government intervention to prevent financial collapse and ensure transparency and accountability of the governance of our universities.
The higher education sector is a vital economic pillar in Wales and our universities are major economic and cultural institutions. Wales’ higher education sector is pivotal – not just for developing a well-educated population, but for the role they play in our communities and their contribution to our research and technological development.
Wales has a well-deserved reputation as being the home of some of the finest education institutions in the world. To see that squandered wouldn’t just be a tragedy, it would be a disaster.
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