CURRICULUM REFORM STEERING GROUP FINANCE PRESENTATION 10 th APRIL 2008

CURRICULUM REFORM STEERING GROUP University Income & Expenditure 2007 Income £M £M Funding Council Grants: Teaching 48.6 Research 15.2 Other Academic Fees: Home/EU16.8 Overseas13.5 Other Research Grants & Contracts 46.6 Other Income:Residences/Catering10.7 Health & Hospital 2.3 Sports 1.0 Other Services etc Endowments & Interest

CURRICULUM REFORM STEERING GROUP University Income & Expenditure 2007 (continued) Expenditure £M £M % of Income Staff Costs: Academic Schools 54.4 Research Grants & Contracts 21.5 Academic Services 6.4 Residences & Catering 3.9 Estates 4.5 Administration 9.7 Other (Restructuring) % Operating Costs % Depreciation 8.9 5% Interest Payable 1.0 1% Revaluation Release 4.1 Surplus 4.3

CURRICULUM REFORM STEERING GROUP University Balance Sheet 31/07/08 £M Fixed Assets292 Endowments 36 Cash 12 Loans/Leases 11

CURRICULUM REFORM STEERING GROUP Financial Pressures/Risks Long term sustainability versus short term spending reviews Spending review settlement for sector 2008/09 – 2010/ / % 2009/ % 2010/ % Staffing costs including pensions: Impact of tuition fees: student trends: international perspective: Efficient Government (shared services) Changing taxation status Act like a business but broad spectrum University, civic responsibilities, e.g. Chapel, Gardens, etc!!

CURRICULUM REFORM STEERING GROUP Resource Allocation Methodology for: Allocating the funding from SFC and all income streams to Schools Allocating the share of Central Services to Schools Allocating the University Central activities to Schools (Surplus, Financial Adjustments, Strategic Investment Fund) Central Services allocation based on: Use, are transparent and easy to update Cost drivers are based on student numbers, staff numbers, and space utilised etc. My advice – keep it simple and incentivise at College level.

CURRICULUM REFORM STEERING GROUP Income/Expenditure Changes Increase Research Grant by 10% gives£1.5M p.a. Increase RG&CS overheads/fEC by 10% gives£0.7M p.a. Increase unfundable fees by 10% gives£1.4M p.a. Reduce core staffing costs by 5% gives£4.1M p.a. Reduce core operating costs by 5% gives£1.75M p.a.

CURRICULUM REFORM STEERING GROUP Some thoughts! Space utilisation poor, dont sweat our assets. High infrastructure costs, opportunities to better utilise/share? Very little additional support costs in relation to growing activity, e.g. buildings, systems, processes all established so incremental cost only/help contribute to fixed costs. Would need infrastructure for home/EU students so overseas fee income provides the development income. Grow endowment funds. More posts funded from endowments, free up core budgets to assist with development/opportunities to expand Make Aberdeen courses/degrees more attractive, i.e. more apply and retained, reduce costs of other activities (clearing, advertising, etc) Stop running courses with 2 ftes! Monitor low level modules, are they covering real costs? Being proactive in monitoring student experience Increase levels of studentships/sponsorships, linking with local industry etc.