University to potentially cut £288k from Students' Union block grant

Wednesday 29-07-2020 - 17:21

Microsoftteams image2f4f22bd1b98c1f0156218bb71ae4135e1056d10f308889b43f79cfecc5cef49

University to potentially cut £288,000 from Students' Union block grant.

Due to the COVID19 pandemic, Universities and Students' Unions are facing increased financial pressure across the country and are exploring how to make significant cost savings. Lancaster University may – as a result – cut your Students' Union block grant by 33% - a drop of £288,000. As a Full Time Officer (FTO) team, we would like to explain what this could mean for you and your Union going forward.

The Students' Union (SU) is a not-for-profit organisation and a registered charity. This means that all the profits made from our commercial services - Central Supermarket, The Sugarhouse, Purple Card and LUSU Living - are put straight back into your Union. This includes everything from sports clubs and societies; Academic Reps; JCRs and PG Board; student campaigning; the Advice Service; Welcome Week; the salaries of student staff, full-time staff, and FTOs; and so much more that forms your student experience.

Your SU receives its funding from three main sources: the block grant (a lump sum from the University), designate funding (money for specific projects from the University) and our Commercial Services profit. In 1981-82 the government changed the laws to fund SUs by a block grant from their parent institution instead of public funds. Our block grant of £871,750, was frozen for three years in 2016 by mutual agreement between the Union and University. Our designate funding can only be spent on specific projects: Green Lancaster, Schools Outreach, certain Sport including Roses, and Community/Internationalisation. We as a Union do not have freedom to choose where this money goes.

Since 2016, student numbers at Lancaster have increased by 14.89% from 13,686 to 15,725, while our block grant remained constant. Effectively, the amount of money we receive per student has fallen from approximately £65 each to £59 - a drop of 9.23% before even accounting for inflation. When considering inflation (at 3.2% on average between 2016-19 according to the Bank of England), the difference is even more dramatic, showing a reduction of 16.9% in funding per student (from approx. £71 to approx. £59). In turn, we have provided more for you with fewer resources to do so.

Leading SUs in England (from the Student Crowd 2018 Awards) receive significantly more funding per student through their block grants:

Loughborough Students' Union: approx. £97
Sheffield Students' Union: approx. £81
Leeds University Union: approx. £96
University of Bath Students' Union: approx. £104
Reading University Students' Union: approx. £82

For the year ending 31 July 2019, the gift aid payments to the charity from the two SU trading companies were approximately £380,000. These trading companies manage The Sugarhouse, Central Supermarket, Purple Card and LUSU Living. However, with the ongoing pandemic, our commercial services are facing unprecedented risks and a significant reduction in their net profit. Combined with the University’s suggested cut in the block grant of £288,000 leaves us in an extremely uncomfortable position as an SU.

This means, in the upcoming year 2020-2021, if the University does undertake their planned cut of 33% to our block grant, the student experience will be adversely affected and what your Union can offer you will have to change. The funding and support you receive from the SU will be tighter than ever given these financial pressures, whether that be funding for a sports club or society, college JCR/PG Board or Faculty Forum.

Despite these proposed cuts from the University, your Students' Union will be striving to continue to give you the best student experience possible. We ask you to understand that we will be unable to deliver everything we currently do with reduced funding and some activities/services will be different due to COVID19 restrictions. We, your Full Time Officer Team, will communicate with you again once we have greater clarity on our block grant position.

If you have queries or comments, please email Atree Ghosh at: su.vp.uniondevelopment@lancaster.ac.uk.

Sources:

Lancaster: https://lancastersu.co.uk/resources/annual-report-2019

https://www.lancaster.ac.uk/data-analytics/studentstatistics.html

Student Crowd 2018: https://www.studentcrowd.com/article/top-20-uk-students-unions-2018

Loughborough: https://www.lboro.ac.uk/media/media/services/planning/documents/FF18-19.pdf

http://apps.charitycommission.gov.uk/Accounts/Ends96/0001146696_AC_20190731_E_C.PDF

Sheffield: https://www.sheffield.ac.uk/about/facts/student-numbers

https://assets.prod.unioncloud-internal.com/document/documents/46061/5c3421f375925e0a1058da76444e3d5b/Sheffield_Students_Union_2018_final_.pdf

Leeds: https://equality.leeds.ac.uk/wp-content/uploads/sites/64/2019/01/Registered-Student-Breakdown-2018-19.pdf

https://www.luu.org.uk/wp-content/uploads/2020/06/annual-accounts-201819-signed.pdf

Bath: https://www.bath.ac.uk/corporate-information/facts-and-figures/