Update on University finances

As you will be aware from my previous communications, together with our very challenging underlying financial position and the financial impact of COVID-19, we currently have a £15m underlying deficit and are facing a further shortfall of between £20m – £35m as we move into the 20/21 academic year.

We already have a programme of work underway to improve our financial sustainability, but the impact of the pandemic means we are facing an unprecedented situation in the University’s history. I cannot overstate the financial challenges we are now facing. Given the situation brought about by COVID-19, it is likely we will see a reduction in international student numbers as well as Home/EU students. This will be on top of the losses we have already incurred through lost accommodation income and a loss of catering and conference income in our third term this year. There is more information on this in this short presentation which has already been communicated to staff and included in a separate presentation to Senate.

Short-Term Measures

While we have already introduced a series of measures to improve our financial sustainability and are looking at accessing a government-backed loan scheme, we will have to take further action if we are to weather the storm successfully.

We are now having to consider short-term measures which will impact on all staff across the University. This includes the possibility of having a total pay freeze for all staff from 1 October for a 12-month period. This would, of course, need consultation with the JSNCC and the University Council. If implemented, this would mean staff will not receive any national pay award and promotion and incremental pay increases would be deferred.

Ahead of this discussion, I felt it was only right that I take a voluntary 20% reduction in pay for 12 months and members of the Executive Group have collectively agreed that they too will take a 15% pay cut for 12 months. We are also finalising the details of a voluntary pay cut scheme for other senior staff and will publish further details at the end of June.

Reward Strategy

Alongside this, we have a continuing need to address our underlying deficit. As many of you will know, we have been working with JSNCC for a number of months on a new Reward Strategy, which is intended to provide a competitive offering across all roles and pay scales and increase transparency and consistency around pay at Kent. This strategy is also of critical importance to making us more financially sustainable in the future.

Many of you have shared your feedback with staff representatives and your trade union representatives on the proposed Reward Strategy and, as a result, we have responded to these key concerns and are offering the following in exchange for staff being willing to accept its implementation from 1 October:

  • Introduce additional pay protection measures to ensure those impacted most immediately by the new pay progression arrangements are helped to adjust to the change
  • Equalise ‘up’ Annual Leave allowance for Grades 1-6 and Grades 7+
  • A proposal to offer greater flexibility for staff

The severity of our situation means there is limited room for any changes to be made to these proposals. There is more information on the above on the Reward Strategy staff webpages.

As your Vice-Chancellor, I recognise this is all an incredibly difficult ask. I know just how hard you have all been working during this challenging time. However, these measures are vital to the future of the University and only by working together in this way will we achieve financial sustainability in the longer term and be in control of our own destiny as an organisation.

These proposals are of huge importance to the University and its future. I urge you all to take time to carefully consider them in the light of our financial situation.