UU falls back on reserves, but not nearly as much as hoped
The budget for 2020, which looks ahead to the calendar year's income and expenditure, was ‘tight': the university would spend 26.6 million euros more than it would receive. UU even took into account a possible windfall of 8 million euros from the Ministry of Education, which the university received after the summer in previous years. The reserves should not increase, said the then vice-president Annetje Ottow, because otherwise the government could start cutting back on the universities.
Since then, it's become clear that UU's ‘savings’ fall within the prescribed margins of the ministry. Nevertheless, the intention was to actually spend the money available on what it was intended for: strengthening education and research.
When the coronavirus reached the Netherlands in March 2020, the university expected to have additional costs which would reduce the reserves by more than 26.6 million. Although these costs were indeed incurred, the crisis also made for unexpected windfalls, as per the 2020 annual accounts, which provide insight into UU's exact income and expenditure in the past calendar year.
In total, the UU had an amount of almost 928 million euros available in income in 2020. That is about 35,000 euros more than expected in 2019. The university spent just under 934 million.
As in 2019, the University also failed to make a reduction of 26.6 million in its reserves in 2020. They have shrunken by just under 6 million euros. In any case, that is a lot more than in 2019. At that time, the university wanted to spend 31.3 million more than it received, but at the end of the year, they only managed to spend 300,000 euros. Additional windfalls were to blame.
Corona windfalls and setbacks
The coronavirus pandemic led to a significant increase in the number of first-year students - an increase of almost 10 percent at Bachelor's level and seven percent at Master's level. Despite the travel restrictions, the number of international students also increased. The extra tuition fees earned by the university led to a big increase in revenue, especially considering the international students from outside the European Economic Area (EEA), whose numbers rose by a quarter. They pay the much higher institutional fee. In total, tuition fees came in 5 million higher than expected. Of those, UU estimates two million comes from students who decided to start their studies right after school because a gap year just wasn't doable during a pandemic.
In addition, the university received money to conduct coronavirus-related research, benefitting the faculties of Veterinary Medicine and Medicine in particular. This income had obviously not been taken into account. Another windfall, this one expected, was saving on conference, travel and accommodation costs. In total, the university saved 12 million euros on this.
Even so, the crisis did cost UU money in 2020. Some costs cannot be calculated precisely, which is why the university works with estimates in some areas, such as tuition fees. The research delayed by the pandemic and not reimbursed by the Ministry of Education amounts to about 2 million euros, resulting in 5 million less turnover for the university. This includes the revenues from cultural centre Parnassos, summer school courses, and room rental. The adaptations the university had to make to render its buildings corona-proof and the allowance for employees working from home cost about 6 million euros.
Because of the pandemic, employees also took less leave, for which the University has to reserve money. In 2019, this already amounted to a substantial sum, 22 million euros, while last year it increased by four million.
As in previous years, Utrecht also received extra money from the government. Three million were received from research financier NWO for science and technology, and six millions went for teacher training programmes that had not been counted on. The amount received from European funds for research was also higher. In addition, revenues coming from licences from parties associated with the university, such as Utrecht Holding, were unexpectedly high: five million euros.
More staff members
In recent years, faculties have been urged to recruit more lecturers so that they can work with smaller groups of students and lighten lecturers' workloads. The faculties have also received money for this purpose, some of which from the millions freed up by the abolishment of the basic grant. However, there was not much progress, so the workload remained high and the reserves did not shrink. In 2020 things have picked up speed - especially in the last few months - revealed UU President Anton Pijpers in the committee meeting of the University Council, where the annual accounts were discussed.
The acceleration was initiated because of the growth in the number of students, the extra work that online education entails and the desire to work with smaller groups of students, thus enacting the political promise to provide small-scale and intensive education in exchange for the basic grant. In addition to the new lecturers, the university also hired more student assistants. Ultimately, in 2020, the number of staff members grew by 282 FTE (FTE stands for full-time employees). At the end of the year, UU had 7916 FTEs, 4144 of whom were academic staff. Pijpers says he is pleased to see an upward trend: in 2019, there were 181 new FTEs. In percentages, the workforce grew by 3.9 percent, in 2019 by 2.5 percent.
The share of temporary contracts among academic staff has grown from 22.4 to 22.9 percent. According to the agreement, only 22 percent of the staff may have a temporary contract, but given the growth in the number of first-year students and the extra lecturers needed for online education, UU considers this growth to be unavoidable.
Whereas the budget stated that 603 million euros would be spent on salaries, in reality that turned out to be to be 644 million. Personnel costs amount to 60 percent of UU's expenses.
Protesting students and teachers
Despite its healthy financial housekeeping, Utrecht University feels that higher education needs more money. The Alarm Day, on the 6th of April, aimed to raise awareness about this issue. It is estimated that the sector needs an additional 1.1 billion euros. Protesters argued that the budget for academic education has not kept up with the increase in the number of students, which means there has been less and less money coming in per student per year. Consequently, there are more students in each class, lecturers are working overtime without compensation, and there's fierce competition between scientists for research funds.
Remarkable facts and figures
The financial prosperity is visible in a number of faculties. The Faculty of Science, for example, should have withdrawn 4.2 million from its reserves, but at the end of the year 5.1 million euros remained. The faculty received more money from the second and third flow of funds, which is money coming from research financiers such as NWO, the European Union, or private companies.
The Faculty of Veterinary Medicine has spent one million less than expected. The faculty has “wryly profited” from the coronavirus crisis, said its director to the Faculty Council. Although initially the animal clinics were only allowed to treat emergencies and the faculty feared that income would drop, the blow was actually softer than they had anticipated. In addition, its scientists were deployed for research into the coronavirus, which not only resulted in more income, but also required the faculty to hire additional staff. Consequently, the cutbacks that the faculty had to make in 2020 and 2021 were achieved more quickly. There is now no need for any more staff to leave the faculty.
At the Faculty of Humanities, more money was spent than the 2020 budget predicted: 1.3 million euros. That's because the faculty hired more staff, and its employees took far fewer leave days than expected. Leave days represent a certain amount of money that must be set aside by the faculty and therefore cannot be spent. Although fewer leave days were taken across the university, there were no major ‘pluses’ in return at Humanities, explained Anton Pijpers in a committee meeting of the University Council. “Things can go wrong pretty quickly if just a few things move in the wrong direction”, explained managing director Miranda Jansen during the Humanities faculty council meeting.
The Faculty of Geosciences is suffering greatly from the measures to contain the pandemic. Many fieldwork projects could not be carried out and new projects cannot go ahead, which has cost them an estimated 4 million euros in revenue.