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April 11th, 2016:

The case against PAS

The Case Against PAS

The University of Reading is implementing far-reaching changes under a review of its Professional and Administrative Services (PAS). These are intended to change the entire administrative structure of the University with a target date for implementation of August 1st 2016. The argument it has given to justify these changes is that there is an operating deficit evident in the recent accounts, which requires improvements in the University’s efficiency and effectiveness.

We submit that the case for PAS is fallacious, and is actually a pretext for increasing central managerial control of the University to help operate it as a wholly profit-oriented corporation. Firstly, in 2014-15 the University actually ran a surplus of close to £1m. The University management attribute this to the success of its efficiency and effectiveness programs so far, including a new website fronting, but the truth is that this was the first year in which a cap on student recruitment had been lifted. The University’s performance (an increase in UG recruitment of 20%) is mediocre in this regard within the sector.

Secondly, we note that in the accounts preceding 2014-15, the deficit recorded was not presented as a cause for concern, and was attributed to spend on the Malaysia campus and changes to the financing arrangements for the sector (plus in 2013-14, largely to PAS itself). Given these earlier reassurances, it is inconsistent to present the same deficit subsequently as necessitating a wholesale restructuring.

Thirdly, we submit that the way to secure any necessary improvement in performance is to invest in the Schools which constitute its core activity rather than, as at present, running them on a shoestring.

Finally, even were it the case that it was necessary to restructure everything, it does not follow that everything should be done all at once. In whose interests is this? It is certainly in the interests of the commissioned consultants, since it is far better financially to receive a larger fee up front than the same sum over successive years. And £20m in two years (University accounts 2014-15, p42 n8) is truly eye-watering, compared to a sector average reported recently in the THES of just £400k per year. This was paid to consultants with no particular expertise in higher education, as part of £36m costs overall.

So the case has not been made for PAS. It will also create very serious problems. The University is trying simultaneously to cut costs and increase revenue. This seems to be an unusual approach to structural organisational change and suggests a strong current of wishful thinking. The view from the ground is that simultaneous reorganisation of everything will result in chaos and will impact heavily on core activities, as is already happening as experienced staff leave to take voluntary redundancy. One may cut salary costs in this way but will also impact on income from student recruitment (witness the recent protests) and academic activities (for example, research support capacity is undermined and academics will have to pick up administrative work). We submit that these negative impacts on income have not been quantified.

The spend on PAS to 2015/16 is astonishing, as noted. We submit that a variety of seemingly contradictory figures have come from the management concerning the financial projections for PAS savings. For example, in early papers a figure of £2.4m savings a year is mentioned, which subsequently is revised to £7.8m. In articles in the Times Higher, management claimed it would recoup costs in 4 years, suggesting £9m per year. In recent pronouncements, PVC Van de Noort states that the spend on PAS will be recouped in just two years, implying savings of £18m per year. Management convened a meeting with UCU and the Staff Forum, after the Vote of No Confidence was first mooted. When challenged on this figure it was admitted that nobody present, including PVC Van de Noort, had actually seen a breakdown of the relevant figures. In short, it seems that the numbers produced to justify PAS are made up spontaneously, despite the vast sums spent on it.

Further questions arise if one supposes that the University is genuinely in a financially precarious position. Why spend £40m on refurbishing the library when its latest refurbishment has only just been completed? Why have large, unsecured loans been taken out, and based on which assurances? Why have halls of residence been sold off, presumably with loss of control of this income stream? Why has a large risk been taken developing a new School of Architecture from scratch, a field in which there is an oversupply of graduates? Then there is the question of executive pay; in 2011 the University had 28 staff at a salary of above £100,000 pa., costing £3,64 – £3,91 million. In 2015 the figures were of 41 staff costing £5,17 – £5,57 million. To put this in context, in 2011 such staff constituted 0.9% of university staff and about 3.5% of total salary expenditure. In 2015 the figures are 1.3% and 4.4% respectively. This forms a continuous trend since 2008 when 12 such staff, 0.3% of the workforce, cost c.£1.5 million, 1.7% of salary costs. In the same period, the average salary at the University did not keep pace with inflation.

Developments at other Universities, most recently the University of Nottingham, suggest the restructuring will not end with PAS. In fact, at Reading PAS was first proposed as the initial stage of more comprehensive reforms, the next stage of which would be an ‘Academic and Related Services’ review. Presumably this would be coupled to the imposition of new contracts (recently overwhelmingly rejected by UCU members), which make academic redundancies easier to implement. It is important that staff lay down a marker that changes that are adverse to the institution will be resisted, and that pressure is applied to the management to reconsider their approach. For all of these reasons we propose a Vote of No Confidence in the Vice Chancellor Sir David Bell in his capacity as leader of the senior management team.

Staff Against PAS.