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Vice-Chancellor's briefing session summary

colour portrait photograph of Vice Chancellor Professor Robert Van der Noort

Dear colleagues,

Thank you to those who were able to join my briefing for colleagues yesterday, and my apologies to those who experienced the technical problems in the morning session. I wanted to provide you with a high level summary of the briefing for those who couldn’t attend.

As I outlined at the briefing sessions in April, the scale of the financial challenge arising from the COVID-19 pandemic is without doubt the greatest such challenge in our history, and this is also the case for almost every other university in the UK. By way of update since my presentations in April, the main development is that the government has confirmed it will not provide any significant additional financial support for the higher education sector, and so we continue to face an estimated shortfall of £106 million over the next three years.

We are already making major efforts across the University to save money, including pausing some major projects and making use of the government furloughing scheme, but these will not be sufficient on their own. While decisions rest with our governing Council, our recommended approach is that we seek to cover £46 million of this shortfall from our reserves and future assets sales and make the remaining £60 million savings from our operating budget. As I’ve said before, the University of Reading is in a much better financial place than some other institutions and it would be tempting to cover more from our savings and assets. However, doing so would leave us vulnerable to further shocks, such as a second wave of coronavirus lockdown, or other unexpected events. So we need to be careful in maintaining some reserves to ensure our long-term sustainability. 

That leaves our operating budget – that is, the budget for the normal activity of the University. As a people-focused organisation, more than half of our budget is spent on staff salaries and related costs. We just cannot make this scale of saving without an impact on colleagues. If the full £60 million saving was made solely through redundancies, that would mean about 500 full-time equivalent roles. This is a worst case scenario, and we will do as much as we can to avoid it. Our Council will meet soon to consider this plan and if it agrees, we will begin formal consultation with the UCU and the Staff Forum, seeking to find routes to keep job losses to the absolute minimum through collective agreement. This might include things such as pay freezes or temporary reductions. The scale of the challenge means that this is the only way we can reduce that large number of potential redundancies in a meaningful way.

I want to make clear that nothing has been finally decided. While we need to act quickly, we will not rush through changes that leave us worse off in the long term. In the briefing session, I provided more detail about the process we are following. Overall, our decision-making will be framed by the need to get through this immediate challenge, but without jeopardising the core purposes and values of our University, as recently expressed in our University Strategy. I have been upfront with you about the scale of the task, because the best way to find the right answer is to seek agreement, including with the UCU and the Staff Forum. Those discussions will start soon. It is only after this process that we will identify any roles that may be affected by redundancies and, if necessary, we would look to conclude selection for any necessary redundancies before the end of January 2021.

This is hard news coming at an already difficult time. I understand the anxiety and uncertainty that this will bring, at a time when many of you are juggling very busy work and family commitments. Many of you will have lots of questions, not all of which I can answer immediately. But we can’t simply ignore the scale of the challenge. It is vital that we act early. I have said many times that I want to be as transparent and open as possible, and that is why I am sharing this with you now, before Council has met and even though there is still a lot of detail that we do not yet know. A lack of timely communication and engagement with colleagues and students has been a failing of previous big changes at the University, and I want us not to repeat past mistakes.

So please do come along this afternoon and ask questions, or take 20 minutes to view a recording if you can’t make it. The huge effort that everyone is making at the moment to keep delivering our activities is just one example of our sense of community and commitment to our institution and our students. I am incredibly proud of the way you have responded to the coronavirus crisis, turning a campus university into an online university in a matter of days, and putting your skills to help the NHS and wider community. We will need the same resilience and resourcefulness to overcome this next challenge. My own commitment and belief in a strong future for the University remains undimmed.

Kind regards,

Robert

Professor Robert Van de Noort

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