Communication from VC in May 2009 to all staff

Dear colleagues,

In this Update to all staff I would like to share my views on how the wider economic situation impacts on us as a University, and how I think we should work together to continue to protect jobs and provide a first class experience for all our students. I will be asking departments to take the time to consider these messages and to discuss the implications for our work.

How will the economic situation affect us?

We are, of course, living through challenging economic times. People are worried about what effect the global financial situation and the recent UK budget will have on them. As I have gone round the University visiting departments, many of you have raised the subject of the economy and how we might deal with the current challenges as a University.

There is no doubt that public sector finances will continue to be under pressure not only for the next couple of years, but for a significant period after that. The higher education sector is not alone in this. However, it is already obvious that higher education is unlikely to be the top priority for any government – coming behind health, and primary and secondary education.

So we know we will have to cope with declining income while many costs continue to rise. Here at Sheffield, our base salaries and pension costs for next year, without any pay increase, will increase by over 3%, yet our funding council grant will increase by only 1.9%.

We have increasing pension costs because of increasing demands on the schemes: this is partly for the very positive reason that people are on average living longer, but also because of increases in salaries. We are also facing an economic situation which affects all investments.

Here at Sheffield, the contributions the University as the employer makes to our local pension scheme are going up by an additional 6%, and the University will also have to pay an additional 2% contribution for the USS pension scheme

A successful University

The University of Sheffield is a successful and vibrant university. We have a good story to tell, with world-leading research in all our faculties, and good feedback from students on their time here. Thanks to everyone´s efforts in keeping within budgets previously, we are rather better placed financially than some in the sector to withstand the challenges ahead. We have close links with our city and region, and are working with them to help the local economy. I am convinced that the single most important way in which we can contribute to the local economy is through remaining a strong and vibrant institution with a large number of staff and students living, working, and spending in the area.

The value of higher education

However, funders and politicians do not always see it this way. I believe our real challenge is our need to convince taxpayers and their political representatives of the crucial success of our universities. We have constantly to demonstrate and remind them of how essential this success is for the whole of the UK.

I say this in the context of a perception in political circles that they need to worry about the quality and standards of university teaching. These perceptions are not necessarily based on evidence, but they are nonetheless powerful - not only with politicians but also with some parents and students.

I believe we will see increasing demands for greater accountability – for example, targets for student contact hours. The question "what has happened to the additional money from higher fees?" is being asked more frequently. Some politicians argue that we have wasted the money we put into salaries and pensions, rather than putting this directly into the student experience. It is felt by some that we don't understand that the whole country will have to work harder.

I think that the real danger ahead for the research intensive universities is that in this political atmosphere of over-enthusiastic consumerism we could become mediocre; and how then could we help drive the recovery of the UK economy?

Adapting to preserve our teaching and research

Let me say very clearly: I wish to protect the research and teaching across the full range of disciplines in our University. The University Executive Board is looking at various scenarios for the future and various ways we might anticipate and adapt to the changes and challenges ahead. But I believe strongly that we will all need to work together to continue to thrive and be proud of our world leading research and the quality of our teaching.

Yes, in order to protect our academic base, we will need to make some changes. Our income will decline relative to our costs. We will have to look at options for how we best manage in this situation – possibly we need to look again at how many courses we teach, and how we teach them. We need to make sure we do not have unnecessarily complex processes and regulations.

And crucially in these uncertain times, we need to keep talking together about the challenges and the possible solutions. To have properly informed discussions we need transparency on things like University budgets and income streams to departments.

We also need to be able to show people that duties are fairly and transparently allocated. Better communication on work load allocation will help to provide this reassurance, and I have asked the Faculties to discuss current practice and to implement a common approach to this as soon as possible: there are a number of very good work load allocation methods already in place in departments, and academic staff tell me that these help enormously in sharing loads fairly and promoting teamwork.

Working together to protect jobs

As you may have seen from my recent email to all staff, I am very disappointed by the decision of the national union UCU to ballot its members on possible industrial action, at a time when negotiations are still underway within the agreed timetable that UCU and all the other campus unions have signed up to. I hope that UCU members will take the time to have a look on our HR web pages at the information about the negotiation process. Here is the link:

www.shef.ac.uk/hr/policies/pay/paynegotiations

There appear to be two main issues for the UCU:

Firstly, the UCU pay claim of 8%: given the current unprecedented economic climate, and our own difficult financial situation, this is clearly unaffordable and we urge the UCU to be realistic in their demands. The impact of the pay offer that is already on the table, together with pension increases, increments, etc, would mean our internal staff costs next year at Sheffield would increase by 4%, that is, over £5.5M.

Secondly, UCU´s other main concern is to seek a national agreement on job security. I fully understand the concerns underlying this and of course job security is a priority for all of us. However, it is not a matter for national determination, as jobs are discussed and decided at local level.

I want to give you all a commitment that, here at Sheffield, I will be doing my utmost to protect jobs, and avoid redundancies. I think we will need to adapt some aspects of how we work in order to achieve long term financial sustainability for our university, and to preserve the quality and range of our academic work. This is the way for us to continue to make a real difference to people´s lives locally, nationally and internationally.

I cannot see that calling for industrial action – particularly one linked to such a high pay claim – will help address our challenges in any way at all or increase willingness of others to listen to our concerns. I urge UCU members to consider carefully the impact that any industrial action at this time would have on our funders, and above all on our students, who are already facing an uncertain employment future. The President of the National Union of Students has said that industrial action at this time is the last thing that this year´s graduates need.

There is no doubt that we are facing very considerable challenges, but I am confident that we can and will work together to meet these. I am very keen to hear from staff directly, and to hear your ideas of how we can improve how we work together – and will be putting in place open meetings and opportunities for you to talk and feed in ideas to me and to the University Executive Board. As I have said, this must be a collaborative response to challenging times.

Above all, you have my absolute commitment, and that of the whole of the UEB, to doing all we can to continue to provide an excellent student experience, preserve our research environment, and to do all we can to protect jobs.

Thank you for your continued support.

Prof Keith Burnett
Vice-Chancellor
More information

If you would like more information, or to tell me your views, please contact me at VC@shef and I or one of my senior colleagues will respond.