Major new capital investment takes time to reach full utilisation and a theme of the Supporting Strategies and School Strategic Plans is realising the benefits of City’s significant investment.
This will be achieved partly through the improvements to staff performance management set out in the People Strategy, including strict and universal adherence to a clear annual timetable of appraisal for academic and Professional Services staff. Appraisal standards and quality will be moderated locally.
It is likely that increasing efficiency, productivity and effectiveness of higher education will be necessary across the sector including at City. Delivering an operating surplus of almost 5% in 2015/16 and a similar level in 2016/17 is a significant, positive change for City’s finances and will enable continued investment during the next five year planning period. The development of the Vision & Strategy 2026 has allowed sufficient time to plan, set and deliver achievable targets for increased contributions from Schools and cost savings from Professional Services.
A financially strong institution, able to deliver the change required to provide a strong base for City’s future, is a key theme of our Vision & Strategy 2026. This firm aspiration must be seen against a challenging external financial environment, one which will see an increase in employers’ pension and National Insurance contributions from 2016/17 and a 0.5% levy on large employers’ turnovers to fund apprenticeships.
Other pressures include:
- Maintenance of the £9,000 undergraduate fee has reduced real income. Fees will increase by 2.8% from 2017/18 prior to the introduction of the TEF (Teaching Excellence Framework) and the level of fee beyond that time will depend on reaching the standards determined by the TEF;
- Downward pressure on international student numbers entering the UK as a result of national immigration policy;
- A likely sixth year of decline in UK postgraduate taught student numbers;
- A decline in NHS spending on education with a move from bursaries to loans for health students.
Sustainability rests on City’s ability to generate sufficient cash and surpluses that allow it to operate both its day-to-day activities and deliver City’s strategic investment objectives and plans.”
City’s Financial & Investment Plan demonstrates that it is financially sustainable. Sustainability rests on City’s ability to generate sufficient cash and surpluses that allow it to operate both its day-to-day activities and deliver its strategic investment objectives and plans. This requires minimum annual surpluses of 5% to 8% of income and targets minimum year-end cash reserves of 45 days of operating expenditure throughout the planning period. The increased surpluses are required to service the costs and cash flow impacts of any long term borrowing and investment.
These targets allow City to establish a position that is firmly in line with the higher education sector and will enable us to access borrowed funds for investment that will support and enable our growth plans.
City’s Financial & Investment Plan is informed by the overall Vision & Strategy 2026. Individual investment plans will be based on the priorities identified within the Supporting Strategies and School Strategic Plans and balanced against affordability. Part of this will focus on improving processes and continuing to increase institutional coordination. There are further significant efficiency and transformation programmes already in the pipeline for City concerning its research and enterprise support and across student and academic services.