Crisis in cash in Cambridge: the elite university reveals that this year will be 30 million pounds in red due to the increase in its deficit
- Cambridge received less funding and government taxes did not compensate
- The deficit was revealed in an email from Vice Chancellor Stephen Toope
- The university faces a "growing budget deficit" thanks to the decline in research funds
- The university pointed out that it has a huge cash reserve and does not run the risk of bankruptcy
This year Cambridge has a deficit of £ 30 million, despite being one of Britain's richest universities.
He received less government funding, along with other universities – but warned that this was not offset by university fees.
Even the 800-year institution, which wants to take more students, was not able to expand into the historic city.
The news of his precarious financial situation shocked the experts because the élite university benefits from generous donations and endowments from its starry students. But despite its advantages, even Cambridge is in trouble in what some say is a sign of things to come for the university sector.
This year Cambridge has a deficit of 30 million pounds because he received less government funding that was not offset by university fees. The deficit was revealed in an e-mail from the vice-chancellor
The deficit was revealed in an email from Vice Chancellor Stephen Toope to the 150 academic departments of the university.
The richest five Cambridge colleges based on equity
1.) Trinity – £ 1.4bn
2.) St John's – £ 780.1m
3.) King & # 39; s – £ 349.9m
4.) Jesus – £ 327 million
5.) Peterhouse – £ 324.2 million
It explains how the university faces a "growing budget deficit" thanks to the increase in costs, the freezing of university fees and the decline of some research funding. Professor Toope wrote: "The budgetary position is deteriorating rather than improving, as was previously foreseen, despite efforts to control spending in recent years."
He said the university's finance team completed a ten-year budget projection last month that "confirmed that we are now running an annual cash operational deficit of around £ 30 million on a combined total budget of € 1.25 billion ". The university pointed out that it had a huge cash reserve and did not run the risk of going bankrupt, being able to afford to stay in the red for years before the situation became a crisis.
Furthermore, the deficit applies only to the budget of the central university, which is responsible for most of the teaching and research. Its 31 individual colleges – including Trinity, St John's and King's – all have their separate budgets for their daily business.
Many are known to be rich, even though much of the money donated to them continues to maintain their historic buildings.
Experts claim that a number of universities are in financial difficulty.
It is thought that many are former polytechnics struggling to recruit enough students.
The revision of universities and school fees should be published in the summer. Led by financial expert Philip Augar, annual tuition fees in England are expected to be reduced from £ 9.250 to £ 7.500.
The news of his precarious financial situation shocked the experts because the élite university benefits from generous donations and endowments from its starry students. In the picture: Trinity College
In his e-mail, Professor Toope said: "A deficit of this order – although manageable in the short term – is not sustainable in the long term".
The vice chancellor warned that "all over the world, universities face obstacles", including "greater political and economic uncertainty, with a growing possibility that financial markets will decrease, reducing the income generated by university and university facilities" . In Britain, this would be "exacerbated by the uncertainty represented by Brexit," he said.
He added: "If the post-18 review of education and funding recommends a significant reduction in tuition fees and the government is not able or willing to compensate for this reduction … the total income of the university sector will fall".
The various financial flows of Cambridge – including the proceeds from the endowment, the philanthropic gifts and the income of its publisher, Cambridge University Press – have meant that "budgetary pressures will be manageable," he said.
But the university "must still take action now so as not to dig into a hole".
According to the latest reports, Cambridge – whose former students include Charles Darwin, Professor Stephen Hawking and Sir David Attenborough – has a cash reserve of over 4 billion pounds.
A spokesman said: "The university cannot depend on government and funding for school fees as much as many other universities, but it must still be prudent."