UCU Update - 17 Feb 2025

On how we'd all like a pony. (Or, on how I'm unwillingly back from the dead - shouting "no!" at the clouds.)

I’m sure we’re all aware that our sector is basically circling the drain right now, right? I mean, I could go into a lot of details, but we’re looking at well over 10,000 redundancies in a year (mostly through voluntary severance) and literally everyone from an already floundering post-92 to high flyers in the RG are trying to cut costs wherever they can because as it turns out, like many of us having been screaming quietly for almost two decades now, the higher education funding model that combinations of governments have saddled us with is not viable.

We can go into the history of this - Oxbridge wanted fees, Labour capitulated like a wet noodle, the Tories decided that we weren’t ever gonna vote for them anyway so fucked our funding incrementally and then all at once, and now Labour is back in power but has pledged neither to borrow money nor to raise taxes, so has nothing to offer us, either - and even if it wanted to, which I’m not really seeing, we’d be very low down its list of priorities given the state of the NHS, social care, primary education/SEND, and so on and so forth.

UKHE is a huge exercise in soft power, a money maker for the UK economy, and something that everyone likes to talk about being proud of - but as it turns out, nobody really wants to pay for it, at all, and we’re now finally seeing what happens when the economic reality we operate in bites down hard.

Except…

That’s not a part of the story that our local branches want to tell. Because it’s not inspiring to the troops, is it? “Well, international students are our only actual source of income that goes in the plus column, but obviously that couldn’t last forever, and inflation and a capped domestic fee means that all our resource has been shrinking the last two years and…. it doesn’t look like it’s getting any better???” through clenched teeth - how’re you going to get folks onto the barricades with that as a message?

And, of course, there has been mismanagement and bad future-proofing in places. Huge loans leveraged on an assumption of forever-growth which then doesn’t appear; but you’re stuck paying the banks for the buildings even if they’re not producing the spin-out companies that will make you much moolah as you had imagined they would be. Lots of gratuitous travel all over the place - both by academics and by higher-ups. When we were rolling in it, as a sector, that money rarely went to staff (in terms of salary/pensions), but it sure was around for everything else. It’s a valid criticism. But it’s also a valid criticism that in many cases should be made of VCs who were basically living it up in the mid-2010s, like the market was never going to buck again, and like we could all afford everything forever. We’re not there anymore, and not every VC has acted (then or now!) like they’re running a casino rather than a university.

So, sure, some of them absolutely deserve to get sacked. Harebrained money-making schemes that ended up not working at all? Sure! Swing that axe. Huge investments in foreign campuses that didn’t achieve anything meaningful? Off with their heads! And so on.

But that doesn’t change the fundamental picture we’re stuck with in the post-Covid era: literally every part of running a university has become more expensive, and we simply are not able to recruit internationally to make up for that anymore, with the exception of like one or two London universities and Oxbridge, coasting on its endowments.

In any industry, when people are paying ‘less’ for your product, you are not going to be able to grow - and in fact, you might end up shrinking. That’s economics 101.

“Oh - but VCs should have known that the international pot of gold would run out at some point!” cry the unions. “They made stupid predictions that would never manifest!”

So, here’s a massive oversimplification of the reality that UKHE has found itself in:

Let’s say we have Q - the number of staff that we need to teach our existing number of students, which we’ll call S.

Let’s now say that in 2023, we recruit Y numbers of students internationally. Our student base is now S + Y. The income we get from students gives us a surplus of Z - some of which we have to spend on recruiting (far too few, in reality) new staff to make our new student number workable. Let’s say that the new staff that we hire, we call X.

So in 2023, we have staffing numbers of Q+X, to accommodate student numbers S+Y.

Cool.

Now what happens when Y starts shrinking?

Well, then suddenly we have a surplus of X.

“But then we never should have recruited Y!” goes the protest.

Okay, but S has been worth the same thing since 2017… whereas everything else we are doing has started costing more since 2017. So Y is there, in an increasing part, to make up for a shortfall in the money that S provides; in other words, our surplus from international students, Z, is shrinking year on year. So it’s not as simple as saying, “we should have never recruited Y.” The correct thing to say is, “recruiting Y prevented us from a crisis because of the diminishing returns from S for a very long time… and that time is now over.”

We have a shortfall on S in terms of what money it represents; and now a shortfall on Y in terms of how many Y are coming in. But the union demand is that staffing levels (X+Q) remain untouched.

How can a university guarantee this? Y is literally one of its only real levers in creating income. Sure, there’s ‘funding’, but we all know what a crapshoot that is - and if we can’t be expected to get it, how can a university be expected to financially plan around it?

And then there’s the argument that we should just sell off parts of the university to make money so that staff don’t have to disappear. OK. Let’s sell all the empty buildings. Oh - wait. They’re not empty? Oh. Okay. Well, let’s stop letting everyone have offices, then. They can hotdesk. Oh, that’s not attractive? And also not workable given how may one-on-one meetings academics need to have? Oh. Well, we should have never spent money on infrastructure to begin with, we are in public education, and we should be able to attract international students (Y! Our only real lever in income generation!) with having shitty old buildings that are falling apart. OH. Wait. That doesn’t work, either?

There’s similar arguments raised in relation to ‘new projects’ started by universities, usually with overseas campuses or new locations or what have you. Even if we purely consider this on financial grounds, I’m of two minds with these: on the one hand, they’ve basically never worked for any other universities, so what makes this different? Without a good explanation, this is an obvious waste of money that could be spent elsewhere. But should that elsewhere just be staff retention? If you’ll remember Y up above, as one of the few levers we can pull to create additional income, attempts to increase #s of international fee payers may be worth it, because where successful, they’d guarantee jobs for longer than “spending reserves on staff costs” ever could (see below). So, absolutely, unions should argue against bad business cases - but the idea that there should not be any spend at all because redundancies are looming is like clinging to the side of a slide and pretending you won’t eventually be carried to the bottom by the water anyway. For better or for worse, and it’s definitely for worse, universities are treated like a business; and businesses have to replace disappearing opportunities for income with new ones unless they intend to shrink forever.

And then we get to the age-old, “Why don’t senior management take a pay-cut?”

They could certainly do it, for some goodwill, or whatever. But that pay-cut would maybe cover the salary of a single academic for a year. It’s not a “solution”. It’s a way of postponing strike action for a few months, at best.

Indeed - if the universities that are going down the redundancy path would just keep all staff, burn through all their cash reserves, and push decision making a few years down the line …. never mind that the banks would come calling almost instantly, because risky investments pay more interest if they don’t just default on the conditions for their loans (and loans are a normal business reality - not all loans are evil or gratuitous!) … we’d just be further down this bad, bad spiral in a year’s time, when there’s still not enough money coming in, and so working conditions would worsen, pay would not go up, and there’s every chance we’d be balloted to go on strike because the cost of living has become excessive, so…. On and on we go.

I wish there were easy answers here, but “let’s go on strike… and then ??? … and then MONEY!” is not the one. (Don’t talk to me about pensions - totally different economic reality, and sane negotiators, and some pressure; it’s not what we’re facing now.) The reality is that UKHE is contracting, because the universities are out of ways to make more money given the restrictions that the government has forced them to operate under. And that’s the case both for the rogue VCs who venture-capital-leveraged the future of their institutions into another galaxy and the ones who have played a fairly safe game to try to keep up with outgoings in a manageable way. So successful strike action here is going to, what, postpone the blow? In which case it’ll be harder next year, bar some absolutely unforeseen change in government policy or how attractive the UK is to international students. Would you bet the house on either of those things changing?

I wouldn’t. And I think it’s far too easy to get folks riled up because of “mismanagement” that may or may not even be real, when that doesn’t change the reality that without actual change in outgoings, all universities will burn through their reserves in a manner of months or years, and that’ll be the end of those universities. I don’t see how sacrificing pay for the cause of making our leadership realise we’re unhappy changes the basic maths at work here. I think responsible union activity at this point would be focused on mitigation of what’s coming, not prevention, and on supporting staff.

But … that’s never going to be as sexy as yelling “it’s not fair” from a picket line that’s forever diminishing in size as well, is it? So we are where we are: being encouraged down the path we’ve trodden so may times in the last decade, but with even fewer of us yelling, to continually smaller effects.

I’d like to end this on a positive note, but there isn’t one that I can see, beyond noting that it could be worse - we could be in the US. Wishing everyone the best with these uncertain and terrible times. One day, we’ll have a government that pays us with more than lip service again - but I’m afraid that now is not that time, and there just isn’t much that can be done to ‘fix’ our sector until then.