Cardiff University is taking action to ensure a projected £65m deficit is not realised.
The university council has agreed on a lowered deficit of £28 million, which is expected by the end of the 2024-25 financial year.
This follows the university’s announcement of plans to axe 400 jobs, with more job cuts expected to follow. The suggested cuts have included the school of nursing, modern foreign languages, religion and theology, as well as music and ancient history.
All cuts have been met with significant backlash from students and staff members. Protests took place at Cardiff’s Senedd to dispute the plans, with students also starting petitions to save their schools.
In efforts to further combat its monetary shortfall, the university’s solution is to accept fewer, but higher achieving students.
In a 76-page document seen by WalesOnline, it’s been found that Cardiff wants to curtail the number of students being accepted through clearing.
The document did not reveal whether the grade boundaries would be raised for higher fee paying international students.
Universities have already seen a reduction in overseas students since visa restrictions were put in place last year, resulting in severe financial losses for the universities.
The uni has emphasised that it is struggling to compete with higher-ranked and well recognised universities amongst international students, which has been worsened significantly with its fall to 186th in the QS World University Rankings.
The “academic futures consultation document – proposals for re-shaping the academic activity of Cardiff University” was sent to Cardiff staff members.
It warned of further potential jobs losses on top of the already planned 400.
The documents revealed that Cardiff University predicts a £65 million financial deficit. It highlights details of the plans, their reasoning and timetable for the proposed cuts. However, as reported by Business Live, the university plans to reduce this shortfall through using its reserves, but highlighted that it is not a long term solution to its financial difficulties.
The document reads as follows: “We will benefit from ‘maintaining tariff’ and reducing volume in undergraduate home (UGH) numbers. Over recent years we have softened our entry requirements to maximise intakes, including through clearing – our proposals here are that Cardiff will now ‘hold tariff’ and no longer soften to the same extent.”
To explain, Cardiff plans to stop lowering grade boundaries just to gain more students. Something especially prevalent during the clearing period, when it would accept students with lower grades than originally accepted.
Now choosing to stick firmly to their original outlined grade requirement (“maintaining tariff”). The university stressed that this will lead to a reduction in home undergraduate numbers from 2025-26.
Talking about grades, the document said: “The financial benefit of greater volumes of UGH fee-payers, once indicative overheads are taken into account, is now negligible. Even with the recent increase to UGH fees, our modelling of ‘holding tariff’ vs ‘maxing volume’ scenarios found that there is no longer financial benefit to taking more of this category of student. Put simply, higher volumes necessitate greater on-costs.
“Holding on entry tariff brings reputational benefits in terms of market position – we will return to the grades typically ‘expected’ of a Russell Group institution, be less reliant on clearing to make our numbers, and will achieve small gains in domestic rankings.
“There will be benefits to the student (and staff) experience with smaller, similar-tariff, cohorts.
“Reducing student numbers will enable greater efficiencies and cost reduction in professional services and overheads as well as in academic areas.”
The university has attributed this sector-wide financial decline to the following factors: A £17 million impact of inflation, decline in overseas students and increased national insurance of 1.2 per cent.
A spokesperson for Cardiff University told The Cardiff Tab:
“The deficit for 23/24 is £31.2m. If we do nothing this financial year (24/25) it would increase to £65m because of:
- £16 million pay award
- Reduction of £6 million in grants received from Medr
- Inflationary increases including energy costs of around £17 million
- Offset by a £7 million reduction from changes in our USS contributions.
“University Council has allowed the University to budget for our third consecutive year of operating deficits and we set the budget at a £28m underlying operating deficit. We have significant work to do to achieve that budget and get our cost base in good shape so that we are not delivering deficits in 2025/26 and beyond.
“To get to the £28m deficit we need to find £37m of savings and/or income. We will do this through making non-pay (estates, IT costs, travel and other procurement savings) savings, we have increased the numbers of domestic students we have recruited to partially mitigate the impact of lower international students.
“We opened a voluntary severance scheme to reduce our staffing costs. We continue to operate recruitment controls and are only recruiting what are deemed critical posts.
“The University is reducing its reserves to finance these deficits. It is a not a position we can sustain indefinitely which is why we need to reduce our cost base in the short term and aim to grow our income sustainably over the medium term.
“It’s important to stress that these are a set of proposals and are subject to a consultation process. No final decisions have been made.”
Consultations on the plans will run for three months, with approval expected to be considered in June by the University Council.
