Budding leaders into the breach

The UK’s new breed of higher education leaders are heading into a brave new world, writes Christina Slade. A couple of weeks ago, some of 18 budding leaders of higher education in the UK could be found building an igloo in a hotel outside Edinburgh. They were attending the final week of a course offered by the Leadership Foundation for Higher Education. This particular program, the Top Management Program (TMP), was in its 19th iteration – hence TMP19. Earlier courses have seeded higher management in universities across the UK. The final week of the program focuses on financial management. And, in our case, the igloo. It took most of the week. The lead was taken by a psychiatrist and dean, Shitij from London University who had spent time in Canada and knew the drill; he was seconded by the CEO of one of the groups representing members of the sector, Alice. It was Alice who crept inside and put the finishing touches by patting snowballs into the apex. There was some skepticism: one budding leader, already a principal of an elite institution, argued: “Building an igloo in a thaw is a perfect metaphor for higher education in the UK.” He did not put hand to shovel. There is no doubt that the situation for higher education institutions in the UK is critical. Around the table, the budding leaders predicted cuts from 5 to 20 per cent over the next few years. All are preoccupied with ‘the letter’, a message sent from Lord Mandelson, as minister in charge of the new mega Department for Business Innovation & Skills (BIS), to the chair of the Higher Education Funding Council for England (HEFCE) on 22 December. Lord Mandelson summarised the reductions. “£180 million ($320 million) efficiency savings announced in the 2009 budget ... [A] deduction of £83 ($147.5 million) following the letter sent to you by my predecessor … In addition it has been necessary to make an adjustment of £135 million ($240 million) from your baseline to meet additional pressures.” Nevertheless, savings should be so managed as to minimise impact. The widening participation agenda must go ahead. Mandelson insists on maintaining the fees cap, but controversially asked the sector to consider two-year degrees (CR, 19.01.10). The agenda is very much in line with the new department’s title, Business Innovation and Skills. Money goes to skills development and research with measurable impact. There is little hope for easier circumstances should the government change at the general election. The fees cap may go, but money will be even tighter. The UK higher education sector has historically been dependent on government funding, although less so than universities in continental Europe. In 2007-8, just over one third of income came from the funding councils, over a quarter from fees, around 16 per cent from research and contracts, 1 per cent the health services and 6 per cent other sources such as student residences and catering. Endowments and investments were low at 2 per cent. Money is an issue. Even in the good times, as the figures from 2006-07 show, the overall sector viability was in question. While the funding council sets an expected level of surplus at 3 to 5 per cent of income, the sector as a whole was running at 1.1 per cent. Only 12 higher education institutions (roughly 7 per cent) generated 61 per cent of total profits. In all, 47 institutions were in deficit. Our budding leaders were looking for efficiencies. Academics typically call for reduction in central services, while registrars and human resources managers want academics to teach more. But it is not easy. The sector is heavily regulated, and reporting to HEFCE requires investment in administrative staff. (The Scottish Funding Council, which funds the 43 colleges and 20 higher education institutions in Scotland, appears to be more flexible and less bureaucratic than its English counterpart.) Academics are under great pressure to produce quality research. Already they are preparing for the 2013 Research Evaluation Framework and pleading for time for research. The strategic planning process imposed by government is critical. Governing bodies are focusing on the mission of their universities, identifying the niche that a particular institution might fill. Mission groups, from the Russell Group of research-intensive universities through the Million+, are refining their market intelligence and identifying their comparative advantages. There will be mergers: some may go under. The international market is an obvious target. UK universities were among the first to consciously recruit international students – from the Rhodes scholarships onwards, the best and brightest from former colonies came home to study. But the game has changed. The competition for international students is intense: from Australasia, the US and Canada, and now European universities with courses in English. The pound is weak, which helps, but the new points-based student visa system is a disincentive. The budding leaders in Edinburgh were given a fitting send off – Henry V. We were asked to call on our imaginations, to assess the past in order to set future directions, to deal with traitors, to survive and inspire in adversity: “Once more unto the breach, dear friends, once more.” A fair prescription for the coming years. Christina Slade is dean of arts and social sciences at City University London.