Agreement needs to start with a shared perspective on finances

UCEA's Raj Jethwa calls for an independently facilitated shared perspective on higher education sector finances

Raj Jethwa is the Chief Executive of UCEA

From the perspective of many observers, the current pay dispute has at its core a simple but complex barbed disagreement.

UCU and the other unions continue to assert that the sector can fund a higher pay uplift than UCEA delivered in the 2023-24 pay round and probably pay rounds prior to that. Higher education institutions, on the other hand, believe that this year’s uplift is beyond what they can afford. Indeed, I know that some institutions are deferring the pay uplift because they simply do not have the money to pay it.

The repercussions of misunderstandings?

If all this disruption is really down to a misunderstanding about the sector’s finances, it is surely a tragedy that such a misunderstanding risks students’ futures by disrupting their progression and graduations.

Of course, institutions are doing everything they can to support students and to mitigate the impact of the marking and assessment boycott. The vast majority of academic staff are not participating in the boycott and the vast majority of students will not be impacted by it. But it only takes a small number of staff to feel aggrieved or students to feel anxious to impact the whole campus community.

There are some UCU members still participating in the boycott with a heavy heart because of their genuine concern for students; and others are not participating out of the very same concern. But this article is not about the many details of the ongoing dispute; it is rather to try and seek solutions and explain why this industrial action needn’t be this way.

Why it needn’t be this way

It didn’t need to be like this. It was out of a genuine concern for their employees that HEIs agreed to propose to unions an early start to the 2023-24 pay round. In December 2022 – during what turned out to be financially more secure times for most institutions than now – we agreed to this process because it presented a rare and unique opportunity to try and address sector-wide cost-of-living concerns. This process led to pay uplifts of between 5 to 8 per cent, nearly half of which was delivered to staff six months early. The second pay uplift, from 1 August, is yet to be delivered and providers are determined to do so, regardless of further challenges and circumstances.

Institutions took a significant risk agreeing to a pay uplift six months before they had any certainty about their finances for that period. Since then, further energy and other cost hikes have put huge pressures on institutional spending and many now face steep increases in employer contributions to the Teachers’ Pension Scheme.

But this misunderstanding is nothing new. For years, campaigns have focused on shouting the claim that there are billions under the sector’s campus mattresses. Meanwhile institutions have argued the opposite until they are blue in the face: with figures and explanations, but perhaps often reticent to draw too much attention to financial frailties for obvious reasons.

Just the facts

I have been involved in industrial relations for over two decades, often on the union side. In many negotiations, my role was to sit in a room with my opposite numbers to try to understand what was available to fund the pay increase. Then the negotiations could actually begin. When I worked for the Police Federation, the Police Negotiating Board, as it was then, had a technical working group which agreed the financial position of the service and what was available to fund increases to pay and allowances. When I worked for the British Medical Association, principled bargaining meant that we worked with the employers’ analysts to agree the modelling that underpinned changes to pay and contracts.

The absence of an agreed perspective of affordability is a shortcoming of our bargaining process in the HE sector. We all pride ourselves on working for and in higher education institutions because they in turn pride themselves on their commitment to the discovery and dissemination of knowledge.

The sector carries out cutting-edge research in every academic discipline – so why can’t we work to apply impartial research to help all sides understand finances and how these impact on pay uplifts? In a sector whose mission includes reaching an objective understanding of the facts, surely having such a shared perspective should be a given?

So where do we go from here?

UCEA is willing to work with the trade unions to arrive at a shared perspective on sector finances. We would support an independently facilitated exercise to establish the factual position in relation to funding and the financial challenges facing different sets of institutions. If the unions are willing to work with us on this basis, then hopefully it isn’t too late to reset our industrial relations.

14 responses to “Agreement needs to start with a shared perspective on finances

  1. What an infuriating blog, Raj! How have you managed to write about this issue without any mention of the stark pay erosion since 2009? Ironically, UCU at the University of Sheffield recently proposed a joint working group to gain a shared understanding of both sector finances *and* the effects on staff pay of the last decade or more of real-terms cuts, but our management had no interest in devoting the time.

    A shared understanding of sector finances is nothing without a shared acknowledgement of the pain caused to staff by the incessant pay erosion. You open your mind to the latter, and let’s see where that gets us.

    It really didn’t need to be this way, but this is tragedy made in Woburn House.

    1. Re the “absence of an agreed perspective of affordability”: Any such perspective needs to involve an analysis of the relative benefit of spending on staff salaries (to prevent them from falling in real terms) versus spending on the other things universities have chosen to prioritise. It can’t simply involve a quantification of how little is left to spend on repairing the erosion of staff salaries because employers have chosen to spend this money on other things.

      1. Absolutely this. In my professional services department, staff aren’t generally responding to the decade of pay cuts by unionising or striking or stopping marking (what marking?). They’re responding to it by getting comparable jobs on £10-20k/year more (plus paid overtime!) in either the private sector or sometimes even the public sector, and leaving us unable to recruit replacements.

        You can have all the fancy arguments you want about whether it’s “affordable”; still won’t get an experienced IT/finance/estates/admin professional who expects to be paid properly to apply for the job. The union unrest is a warning and a symptom. If you disregard it, what comes next will be even worse.

  2. From this blog, it is clear that ‘shared perspective’ means the perspective of one side, not both. Past experience shows that when that perspective is challenged, which is what leads to the disruption, one side imposes its ‘agreement’ and decides the matter has been closed definitively so ‘let’s move on to less contentious issues’.

  3. So for all of your union experience, you somehow didn’t learn at any point that industrial action is a last resort (in all cases), and you don’t get that all of us participating are doing so despite concerns for students? This isn’t fun. It’s not what my job should be like. It’s not how I want to be relating to students. And that’s even before counting up how much I’m sacrificing personally to be a part of it.

    Sure, I’d love for there to be a shared understanding, although I suspect that first we need to have a shared understanding of what “shared understanding” means, as previous comments have pointed out. But then again, I also remember what happened when the Joint Expert Panel whose establishment marked the end of the 2018 pension strikes reached an actual shared understanding that basically the unions had been right all along: nothing. Of course that was with USS, but it’s amazing how much the rhetoric sounds the same between you guys. Do you talk? You’ll have to forgive us if years of getting jerked around with below-inflation pay rises and single-year contracts has not made us particularly likely to trust you to do the right thing without industrial action going on.

    We need binding, meaningful discussion from UCEA, and it needs to start now, to salvage whatever can be salvaged from the current situation.

  4. I am incandescent that Raj is allowed to say this unchallenged. This manages to be both an incredibly one-sided view of HE, AND a view with some remarkably leaky arguments!

    No mention of the rising number of VCs and HEIs signing joint statements with trade unions urging UCEA to come back to the table (almost certainly a better use of everyones time than writing think pieces for WonkHE), no real stats to back up the assertion that a MAB is not widespread or whatever we’re meant to understand by “others are not participating out of the very same concern”

    A very casual skim of twitter and/or student press reveals another perspective as students and TU branches post about their institutions attempts to mitigate the effects of the MAB (‘No Decision’ Degrees, Final submissions/theses/papers marked by unskilled or non-specialists, members of SMTs trying to mark all student work, students appealing marks, students being told they will receive info about their degree ‘after’ they graduate, deferred graduations… the list goes on).

    The suggestion that UCEA independently proposed an early pay uplift out of the goodness of its heart is laughable, this would hold a lot more water if there hadn’t been a current round of industrial action taking place at the same time and another UCU reballot for continued action on the cards (which the union won)

    Raj also mentions his work in, and the work of two other representative bodies, the Police Federation and the BMA, two organisations involved in or currently campaigning for industrial action citing the cost of living crisis and historic below inflation pay rises. It’s a little petty, but one imagines that if he’d been more forthright and pushed for fairer pay in his job there, they may not be in dispute currently.

    Lastly, following on from the idea of below inflation pay rises, I would like to hear Raj and UCEA defend pay rises of VCs (UCU estimate an increase of average total remuneration from £268k p/a to over £300k p/a in the last two years) after years of below inflation costs for the lowest paid employees. I’d also like to hear the counter argument to the position that while higher education is now dealing with many pressures the consequences of pay suppression is entirely one of its own making (and not just for academics but everyone else too employed their too)

    This is a crisis of university managements own making, 10+ years of chickens coming home to roost.

    1. Ian, you are ‘incandescent that Raj is allowed to say this unchallenged’? Not true as Wonkhe offered right of response to UCU. No response as yet apparently. Perhaps a ‘one-sided view of HE’ is permitted. But only by UCU. On social media.

      1. I feel like this comment would hit harder if it wasn’t submitted anonymously.

        Ditto if UCEA had updated their twitter account since 2021.

  5. I have only one thought on this article and the author and it is expressed by this emoji

  6. It is up to Universities to decide how they spend their money. And they are happy to spend it in a way to pay for new buildings, new IT projects etc, while not indexing the staff salaries according to the inflation. The fact that there are no surpluses now to pay for salary increases just means that the universities chose to spend those surpluses on something else.

    We already see now that this approach of letting real values of salaries go down by offering below inflation rises leads to people not coming to the UK at all because salaries are low, so UCEA will start to see the impact of their shortsighted economising.

  7. Stop gaslighting us about ‘pay uplifts of between 5 to 8 per cent’. When you’ve cut our pay by 20% in real terms over the 12 years to 2021, and then inflation has eroded our pay by 11% and then another 9% in the past couple of years, a ‘pay uplift’ of even 5% would mean a 45 per cent pay offer. In reality of course we’re not asking for a pay uplift – dream on… I admire doctors for asking for an actual pay restoration, but in HE we’re so ground down by our employers stealing our labour for free, week in, week out, that we wouldn’t dare ask for a real pay uplift. We’re just asking you to slightly reduce the rate at which you’re cutting our pay!

    If we’re going to look at shared perspectives on affordability, how can it possibly be affordable for universities to have managers on six figure salaries, who never talk to frontline staff, let alone students?

  8. Why is “impartial research” needed to read an annual financial statement? I bothered to read my institution’s annual accounts and they have both a significant annual surplus and much cash in the bank. This isn’t hard.

  9. The ‘rich universities could pay more don’t want to hurt the poor universities’ argument would be more credible if the rich universities hadn’t become so, or more so, by drawing students away from the poor universities after caps were lifted.

    And in any event, why should the employees of well-off universities have to subsidize the poor universities who have failing business models?

  10. Since when did the research-intensive institutions in the Russell Group give a monkey’s about what happened to the post-92s? As Nick said, the Unis have been ‘harvesting’ students from the tier below them to keep undergrad numbers up (and the £££ rolling in) for decades, especially in more ‘income generating’ subjects. It will be familiar across the sector that a balance sheet shortfall equates rapidly to “Let’s take another few hundred science students”. Those ‘extra’ students will thus not now go the Univs a bit ‘further down’ the pyramid,,, which in turn will ‘borrow’ bodies from the next tier down… etc etc.

    The net result of this is that the more ‘struggling’ Unis – also typically the ones with the most students from historically less-Uni-attending and marginalized groups – are the ones struggling to fill their places with fee-paying students, and hence on a knife edge.

    Univs at the upper end have known about this for years. I dare say the VCs from the ‘struggling’ institutions talk about this issue repeatedly at UCEA & UUK gatherings, while the VCs from the Russell Gp sit & nod sympathetically… and then just carry on with the same policies.

    Given this, the idea that the current refusal to countenance giving staff a decent payrise is about a (hitherto undetectable) concern for the ‘struggling’ bits of the sector is…. well. The old Private Eye lines about ‘Pulling unmelted pats of butter from his mouth…’ or ‘Taking an onion from his pocket…” spring to mind.

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