Northumbria University

Where does the money come from & how is it spent?

David Chesser DVC & FD

1

Presentation Aims:

To provide a better understanding of the University’s sources of income

To appreciate how the income is spent

To understand how the University is funding it’s investment programme

2

City Campus East

3

Sports Facility

4

Sources of Income

5

Public Funded Teaching • HEFCE 60.4 31%• Health Authority 20.5 10%• Training and Development Agency 3.4 2%

»Total Public Funding 84.3 43%

Tuition Fees • Home/CV 31.5 16%• Overseas 21.3 11%• Top-up Fees 20.8 11%

»Total Tuition Fees 73.6 37%

Research and Consultancy• HEFCE (Research Grant) 1.3 1%• Reseach Grants and Contracts 5.1 3%• Consultancy and short courses 5.4 3%

»Total Research and Consultancy 11.8 6%

Other Income• HEFCE (Special Intitiative funding) 4.4 2%• Academic Income 2.0 1%• Service Department Income 18.7 10%• Deferred Grants 1.9 1%

»Total Other Income 27 14%

Total University Income 196.7 100%

Income Budget 2008/09 (£m)

6

HEFCE – Block Grant for Teaching

On 1st December a student census is taken Data forms the basis of the following years

grant Bids can be made for Additional Student

Numbers (ASN’s) The census also demonstrates to HEFCE

whether there are too many or too few students in relation to the funding Northumbria is receiving for the current year.

7

HEFCE - Banding

HEFCE funds students on four different levels:Band A: Specialist Medicine (Attracts a

weighting of 4.0)Band B: Lab based e.g. Engineering or

Applied Sciences (Attracts a weighing of 1.7)Band C: Mixed Lab and Classroom e.g.

Informatics (Attracts a weighing of 1.3)Band D: Classroom based e.g. Business

Studies (Attracts a weighing of 1.0)

8

Hefce Block Grant

Grant£

Fee£

Total Income£

Band D 2765 3145 5910

Band C 3596 3145 6741

Band B 4702 3145 7847

The total income per Band per Student for 2008/9 is:

9

Allocation to Schools

HEFCE Grant Allocation by School 2007/08£000 %

SchoolArts and Social Sciences (SASS) 11,254 20%Built Environment (BE) 9,675 17%Computing, Engineering and Information Sciences (CEIS) 7,191 12%Newcastle Business School (NBS) 6,286 11%Applied Sciences (AS) 6,066 11%Design School 5,693 10%Health, community and Education Services (HCES) 5,093 9%Psychology and Sports Sciences (PSS) 5,186 9%Law 3,139 5%

10

Annual Planning Cycle

A key outcome is that the University Executive determine the targets by School for the future years recruitment

Student numbers are moved to reflect changes in demand and the resources follow

11

NHS Contract (£20.4m) Main Contract covers the provision of over 4.500 nursing

and midwifery education students, split between pre and post registration. The main elements of the contract include:

Nursing and Midwifery Contract (Pre and Post Reg.) £13.9m

BSc Degree RN/RM £2.3m BSc Physiotherapy £1.3m BSc Occupational Therapy £1.1m

The contract runs 1st April – 31st March Is renewable annually Has a 3 year term

12

Training and Development Agency Contract (£3.4m)

Main Contract covers the provision of circa 600 Teacher Training places in the both Primary and Secondary Education.

All places are funded by the TDA between £4,000 and £6,000 per trainee

Teaching in over 20 subjects including English, Mathematics, ICT, Science, History etc.

Subject to OFSTED

13

Top Up Fees (£20.9m)

From 2006/07 all new FT UG students where required to pay an annual fee of £3,000, 2008/09 this increased to £3,145

Students can fund this via deferred tuition fee loan offered by the Students Loan Company (SLC)

The SLC will pay to the University in two instalments.

The estimated additional income for 2008/09 is £20.8m, of which £7.0m will be paid out in bursaries and scholarships.

HEFCE are reviewing the weightings between bands, as with top up fees the lower funding bands benefit

14

Tuition Fees

Home Fees (£25.4m) 23,365 undergraduates 4,700 postgraduates

Collaborative Ventures (£6.1m) 14 UK partners - 75 course codes; 23 International partners - 190 course codes 5,900 students

Overseas Fees (£21.3m) 3,413 international students paying +/- £7,000 per year. Recruited from across the Globe including China, Hong

Kong, Malaysia, India etc. to a range of courses in the schools of NBS, CEIS, ASS, BE, SASS, Design

15

Research and Consultancy (£11.8m)

HEFCE Research Grant (£1.3m) Block Grant from HEFCE based on performance in 2001

Research Assessment Exercise RAE Award based on 2008 submission of £3.3m

Research Grants and Contracts (£5.1m)

Consultancy and Short Courses (£5.0m) Main sources if income include:

Research Councils, NHS, Local Authorities, UK and Overseas Companies, SME’s

Annual number of Research and Consultancy projects required to deliver targeted income is circa. 700

Income includes the Egyptian Contract

16

Other Income Academic Income (£2.0m)

Materials £0.5m Residential Fees £0.4m Field Trips £0.3m Exam Re-sits £0.1m Registration Fees £0.1m

Service Department Income (£18.7m) Student Residences £7.6m Catering £3.1m Printing and Reprographics £1.4m Sports Facilities £1.3m Interest Receivable £0.3m Retail £0.4m Car Parking £0.2m Conferences £0.2m

17

Key Facts

The University’s income has doubled in the last 10 years

Northumbria’s income ranks it 35th in the sector out of 159

Health, Community & Education Studies income is greater than 42 UK HEI’s

Northumbria’s ranking on international income is 28th (2006/7 figures)

Northumbria is the 4th largest recruiter of Indian students & 7th largest for Chinese

18

How do we spend our money?

By far the largest area of expenditure is salaries at £116.0m - 59.0% of income

Split: £m Management 17.0 14.7% Academic 55.6 47.9% Support 40.1 34.6% Other 3.2 2.8%

116.0100%

Salary growth in 2008/09 7.4%

Projected growth in 2009/10 >8.9%

19

Other Annual Expenditure (£m)

Student Scholarships 7.0

Interest 3.7

Travel & subsistence 4.7

Rent, utilities, insurance 8.7

IT & Telecoms, equipment 5.0

Books & Periodicals 2.8

Student Recruitment 4.1

Public Relations 0.7

Sport Northumbria 1.1

Catering & Cleaning Materials 2.9

Building & grounds, maintenance 6.4

Research Development Fund 0.8

Other 12.1

TOTAL 60.0 20

Income & Expenditure Account (£m)

Income 196.7

Expenditure

Staff 116.0

Non-staff 60.0

Depreciation 9.0

185.0

Operating Surplus 11.7

Surplus % 6.0%

21

Cash Flow Statement (£m)Opening Cash 11.6

Surplus 11.7

Depreciation 9.0

Deferred grants released (1.9) 18.8

30.4

Loan Repayments (0.5)

Capital Expenditure (35.6) (36.1)

New Borrowings 7.2

Capital funding 6.5 13.7

Closing Cash 8.0

22

Borrowings Graph

23

Where does the money come from & how is it spent?

Thank you for listening

David Chesser

Deputy Vice-Chancellor & Finance Director

24