In the News
Do highly leveraged universities deserve a bail out?
4th April 2020
My article today comes from the Financial Times where Camilla Cavendish asks if universities are too big to fail?
She outlines some of the failures of universities in recent years as they have piled on the debt to increase student numbers, facilities and grow their operational staff largely at the expense of investing in their academics and in making sure that students have sufficient contact time both in lectures and supervisions.
"Between 2005 and 2018, the number of university marketing and public relations staff rose nine times faster than the number of academics.....Borrowing by universities trebled to £12bn between 2010 and 2018."
My instinct is that the university sector will look quite different a year or two beyond the immediate crisis.
Will 3-year degrees survive as the default option? Will students be prepared to pay the full tuition fees anymore if much teaching moves online? Will the days of throwing unconditional offers around like confetti come to an end? Will students apply post A-level instead of the usual UCAS system?
Some universities are likely to go under. Is there a sufficiently strong case for a government bail-out? I'll leave these questions with you.
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