The University of South Wales (USW) is facing a £6m deficit in its current financial year due to a significant rise in non returning students and running costs.
In an internal email to university staff its Vice-Chancellor, Dr Ben Calvert, said the higher education institution will have to look at in-year and medium term efficiency savings - although it wouldn’t clarify if this could see a reduction in staffing levels. The university employs more than 2,600 staff of which 1,600 are academic related.
For its current 2022-23 financial year, which runs to July end, Dr Calvert said while its number of enrolled international students was significantly higher than in the previous two academic years, it was still below target. This he said was partially down to some students deferring to the February 2023 intake. He also confirmed that USW was able to enrol 253 more UK full time undergraduate home students than the initial target - although this was still 3% fewer than in September 2020.
On the financial position Dr Calvert told colleagues: “Tuition fee income is providing £1.6m less income than we had planned. Whilst our new entrant income is £4.3m more than anticipated, there is £5.9m less income from returning students.
"Overall, we anticipate there will be an approximate £6m deficit at the end of this financial year. We have also seen an increase in costs, such as investment to pump prime home recruitment activity, agent costs to recruit international students, wage increases, inflation in our supply chain and of course cost of living support including £850,000 allocated for additional help (bursaries for students and free breakfast scheme)."
On students opting not to continue their learning at the university, the Dr Calvert said: “We have seen a 6.1% decrease in our returning students compared to last year. Colleges and some universities across the sector are reporting similar patterns. Whilst we have seen fewer students being withdrawn as a result of our lack of engagement process, we are seeing more students reporting that they have withdrawn due to health and employment reasons, and a small number who have cited financial reasons. “Worryingly, there was a significant increase in the number of students who were discontinued at assessment boards, either for not submitting any, or parts of, their work or failing the assessments they submitted.
“We know that the suspension of A level examinations and the so-called grade inflation from A levels and other qualifications has had an impact; we also know that the trend of submitting only some assessments is mirrored in our local colleges. In addition, the cost of living is almost certainly having an impact. In this perfect storm, a retention taskforce has been set up to implement swift and targeted actions. We have previously significantly improved our retention so that over a number of years we have been at, or better than, our benchmark. So, we are good at this, and we will work hard to get back to that position.”
To address the financial deficit for the year the Vice-Chancellor said: “We need to generate new and alternative sources of income, drive the USW 2030 strategy, and invest in our longer-term growth and improvement. We will also have to look at how we can achieve in-year and medium-term cost efficiencies and plan for longer term priorities with faculties and professional service areas as part of our planning and budgeting cycle. We must align costs with income and generate surpluses to reinvest in our education and research priorities.
Asked if job losses could form part of efficiency savings a USW spokesperson said: “It’s a difficult operating environment for everyone, including the higher education sector. We are anticipating that we will be posting a deficit at the end of the financial year. USW has strong financial foundations, generated from years of good performance, that enables us to be able to continue to strategically invest as we evolve and remain flexible to meet short-term deficits.”
The university has more than 23,000 students. USW were asked to provide student and staffing figures for its current financial year, but would only refer to latest published figures from the Higher Education Statistics Agency which are two years old. They show, based on the 2020-21 academic year, the university having more than 3,200 overseas students, with more than than a third attracted from four non EU nations in China, India, Nigeria and Bangladesh.
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