Presentation to Heads and Managers Forum
26th September 2012
Dr Michael B. Murphy, President, University College Cork
Presentation Outline
1. Financial Situation
2. HR Summary
3. Research Funding
4. UCC Response to the Financial Situation
UCC Financial Performance 2007-12
•
Recovered recurrent deficit position
•
Improved Cash position
•
Improved Capital Deficit position
•
46% reduction in Core Grant since 2008 peak of €84m (€46m in 2012)
•
Exchequer funding has fallen from 84% to 62%
•
Not all of this income reduction felt in annual budgets given pay cuts and
higher student contribution, however
•
Annual reductions in total budget available across University
•
Negative service impact
•
UCC must minimise expenditure in September 2012
•
Further cost reduction will be required to break-even this year
Overview of Last 5 years Financial Performance
2006/07
€000
2007/08
€000
2008/09
€000
2009/10
€000
2010/11
€000
Total Income
261,167
261,719
301,154
284,000
268,510
Total Expenditure
266,611
260,829
290,293
282,505
267,959
Surplus / (Deficit)
(5,444)
890
10,861
1,495
551
Cumulatative Deficit
(13,923)
(13,033)
(2,172)
(677)
(126)
Capital Deficit
(42,000)
(35,000)
(22,000)
(13,300)
(14,000)
2013 Budget Overview
•
Further 6.5% reduction anticipated in Core Grant from 2012 level
•
Non Exchequer income at same level as 2011/12 except of year 2 of ACMS
•
Non exchequer income not growing at a pace to match reductions in exchequer
funding
•
Changes to PG supports will lead to a reduction in PG income
•
Increase in student contribution charge of €250 offset by corresponding €250
reduction in “free fees” – student payment issues
•
Savings required across the University to deliver a balanced budget
•
All areas to contribute – try to minimise impact on student facing areas
•
Limited scope for investment and essential maintenance
•
ECF will require reduction in FTE and pay
2013 - 2015
Scale of Immediate Fiscal Challenge
•
€8.6bn reduction in public expenditure to reach 3% deficit target by 2015
•
Since 2008 income including research has dropped from €313m to €252m in 2012/13
•
Based on 2012 reduction, impact on UCC to 2015 assessed at a further exchequer
income reduction of €21.1m
•
This will have knock on effect on other sources of exchequer income - Research
Funding and overhead, HSE funding, Skills, Fottrell, GEM, Access, Quality
•
When adjusting for the above and unavoidable increases in expenditure (e.g.
Increments, maintenance) over the next 5 years, UCC will be required to make good
c€25m of a funding adjustment to deliver similar level of service as in 2012
•
Student Contribution anticipated to grow to €3,000 no net gain
 Tuition Fee will fall pro rata
 likely bad debt impact and no net gain to University
•
No opportunity for critical/strategic investment unless the €25m can be found
2013 – 2015:
Assessment of Impact on UCC (€m)
2012
Actual
2013
Forecast
2014
Forecast
2015
Forecast
2012-15
Change
Forecast Net Annual Reduction in Funding
in Exchequer Related Funding
5.70
8.48
7.47
5.11
21.1
Staffing Increase - Super Critical Posts
3.20
0.00 *
0.00 *
0.00 *
0.00 *
Increments
0.80
0.80
0.90
0.90
2.6
Research Overhead Reduction
2.50
0.80
0.50
0.50
1.8
Strategic Funds
1.20
0.00
0.00
0.00
0.0
Non Pay Pressures - Energy/WGB/VAT
0.60
0.00
0.00
0.00
0.0
Total Funding Gap
14.00
10.08
8.87
6.51
25.5
Cumulative Funding adjustment/Savings
14.00
24.08
32.95
39.46
25.5
5 Year Impact of Income Reduction across UCC
Income Change 2008/9 to 2012/13 - Excluding Research
€,000
UCC
CACSSS
B&L
M&H
SEFS
Central/ Other
2008/09
210,616
44,408
30,936
48,245
52,278
34,749
2012/13
194,583
42,334
25,832
52,289
42,079
32,049
Movement
(16,033)
(2,074)
(5,104)
4,044
(10,199)
(2,700)
Final Budget Movement 2008/9 to 2012/13 - Excluding Research
€,000
UCC
CACSSS
B&L
M&H
SEFS
Central/Other
2008/09
210,616
28,945
17,678
36,216
33,892
93,885
2012/13
194,583
28,557
18,081
42,242
30,870
74,833
Movement
(16,033)
(388)
403
6,026
(3,022)
(19,052)
- While Income has fallen by €16m since 2008/9 - priority has been given to maintaining budgets in Colleges
- As a result most Colleges have had limited reduction in final budgets with the exception of SEFS
- M & H net budget has increased due to the introduction of GEM and ACMS
- To avoid reductions in Colleges budgets beyond 2012/13 - must grow non exchequer income
Reduction in Staff FTE 2008-2013
•
FTE figures (Core Staff) December 2008
•
 1,911.50
•
FTE figures (Core Staff) as at December 2012
 Target: 1,728.60
 9.6% reduction from 2008
•
Anticipated FTE Ceiling 2013
 1676.7
 52 FTE reduction from December 2012 figures
 12.28% reduction from 2008
Staff Reductions 2008-2012
Research Funding: Challenges and Opportunities
•
Increasingly competitive national funding programmes
•
Sustainability of research infrastructure
•
Significant change in emphasis
 Excellence with Impact
 National Research Prioritisation Exercise
•
Proportion of non-exchequer income increasing to compensate for decrease in
national exchequer funding opportunities
•
Increased resource from FP7; Horizon 2020 will bring further opportunities with
considerable alignment with UCC research strengths
•
SFI Centre programme
•
Research career framework – clarity
Input: Research Expenditure — Exchequer versus
Non-exchequer (% Contribution)
Input: EU-FP7 New Award Research Income (€k)
18000
16000
14000
12000
10000
8000
6000
4000
2000
0
2006-2007 2007-2008 2008-2009 2009-2010 2010-2011
Since 2008-2009, there has been a 222% increase in the value of new research
awards secured by UCC researchers from the European Commission
FP7 Performance [to Nov 2011]
Participations
Successful
% Success
Participations Rate
Funding
(€/M)
€/FTE
Researcher*
TCD
560
125
23%
€ 51.6
47,731
UCC
526
125
24%
€ 43.3
52,720
UCD
516
122
24%
€ 45.3
38,154
NUIG
381
80
21%
€ 27.4
-
DCU
278
54
19%
€ 14.6
-
UL
172
35
20%
€ 11.4
-
WIT
152
26
17%
€ 11.1
-
NUIM
99
13
13%
€ 4.1
-
DIT
85
10
12%
€ 2.5
-
RCSI
56
13
23%
€ 8.0
-
CIT
48
7
15%
€ 1.3
-
*FTE data taken from last Forfás HERD survey
Inputs: Industry New Award Income (€k) New Awards
Industrysponsored
Projects
2007/2008
2008/2009
2009/2010
2010/2011*
1
19
29
35
Non Exchequer Income 2008 - 2011 (€k)
University Total
18000
16000
14000
12000
10000
8000
6000
2010/11
2009/10
4000
2000
0
2008/9
UCC Steps to Protect Education Quality: Income Growth
1. The pace of exchequer funding reduction is not being replaced quickly enough by
new income
2. UCC must continue to do more with less - if we cannot replace reductions in
exchequer income with new non exchequer income - unavoidably have to reduce
expenditure
3. University 2009 Income Generating Policy being updated
4. Income generation now incorporated as part of strategic planning process
5. All staff must participate in income generation
6. Incentives to foster income diversification
7. Cap EU undergraduate admissions
8. Focus on fee-paying EU postgraduate recruitment
9. Focus on non-EU undergraduate, postgraduate and PhD recruitment
10. Focus on part-time, distance and adult learners
11. Overseas programme delivery where feasible and profitable
UCC Steps to Protect Education Quality: Efficiencies
1. Manage the teaching burden through new learning technologies
2. Reduce the examination burden
3. Robust review of current bureaucracy  Mapping of support staff deployment
 moratorium on support staff appointments
 adoption of redeployment
4. Employ all new staff funded by non-exchequer income, through a wholly-owned
UCC subsidiary company
5. Prioritise research that is important and affordable
6. Procurement
7. Opportunities to close/ merge/consolidate programmes must be taken – should
not continue with unviable programmes
8. Engage vigorously with government (via IUA) on the national policy imperatives