Latest news with #ShaneO'Neill
The Courier
3 days ago
- Business
- The Courier
EXCLUSIVE: Dundee University submits £100m rescue plea to government
Dundee University has submitted its formal request for a bumper £100 million cash bail-out to help reduced job losses and secure a stable future, The Courier can reveal. The request was received by the Scottish Funding Council (SFC) after weeks of discussions between the university, funding body and government. It includes £40 million over two years and access to a liquidity facility of between £40m-£60m to support day-to-day spending. Together, that means the government could be putting together a rescue package of £100m. This is all on top of a previous loan of £22m already provided in March. Insiders suggest some of this cash could come in the form of commercial loans from lenders, though negotiations on access to lending facilities have stalled. The money will help to reduce the total number of redundancies and work towards a more stable financial footing over the next two years. And while the sum is considerable, sources say that ensuring the region's educational future is secure is at the top of the government's priority list. It comes after First Minister John Swinney was quizzed on the drawn-out negotiations at Holyrood on Thursday. 'The figure shouldn't be a surprise,' one insider said. 'The university have been engaging with the funding council and ministers on the level of support. This step was really just a formality.' In an email to staff, interim principal Shane O'Neill confirmed the request for support. He said: 'This additional support is necessary as we continue to make our recovery. 'We are making a substantial ask, which is reflective of the level of support needed around the proposals for a reduction in our staffing of up to 300 FTE via a voluntary severance scheme. 'The SFC will now consider the request we have made and we will provide further updates in due course. 'While those discussions continue I am not in a position to give substantive details but I will share more information as and when I can.' Interim court chair Tricia Bey previously told MSPs that without the cash the university would likely have run out of money by the end of June. Dundee-based Labour MSP Michael Marra said the SNP government should now 'follow through' on its commitment to provide the financial support required. The MSP said: 'The financial costings of the government's target of 300 redundancies has now been completed. 'It has taken far too long and ministers must now ensure immediate action so university staff can begin to plan their lives again. 'The voluntary severance scheme can, should, indeed must be launched in the next week. 'That will help to slow the financial bleeding that has gone unchecked for seven months since the scale of the crisis was made known to the public.' The Scottish Funding Council confirmed it had received the university's request.
Yahoo
19-05-2025
- Business
- Yahoo
‘Relying on overseas students almost sent our university under'
As recently as two years ago, the leadership at Dundee University had every reason to trumpet their success. After all, their decade-long pursuit of overseas students was paying handsome dividends, with record numbers – including hundreds each from Nigeria, India and China – thronging the campus and generating unprecedented millions in tuition fees. From the wood-panelled splendour of University House, the Italianate villa which had long served as the centre of learning's headquarters, officials gleefully reported that growth in income had surpassed even the most ambitious targets. Anticipating ever greater, and more lucrative, recruitment of students from abroad, they confidently forecast a 'positive financial outlook'. Fast forward to today and such positivity is a distant memory. In November, in a move that stunned Britain's higher education sector, Dundee unexpectedly announced it was facing an unmanageable £35m annual deficit. Worse still, its reserves had been run down to zero. The university was broke. Only an emergency bailout from the public purse saved an institution dating back to 1881 from bankruptcy and immediate, permanent, closure. Now, as the university must undergo the painful process of cost-cutting and contraction necessary for it to survive (even the magnificent University House is being sold to raise much-needed cash). The man tasked with bringing it back from the brink, Professor Shane O'Neill, has issued a stark warning. He says Dundee might prove to be higher education's metaphorical canary in the coal mine as a wider calamity begins to engulf Britain's universities. Prof O'Neill, appointed as Dundee's interim principal following the financial meltdown, acknowledges the policy of deliberately targeting foreign students, previously seen as the best way to bankroll the university, actually fuelled the crisis. Dependence on cash from overseas, he explains, left Dundee exposed both to unpredictable shifts in the international economy and to the tightening of Britain's immigration rules. His comments follow a recent alert from the higher education watchdog about the rising threat of bankruptcy across the sector, and also the publication earlier this month of proposals by Labour which could make it even harder for universities to recruit international students. 'Reliance on international tuition fees is the main reason for Dundee's financial crisis. It devastated our income,' Prof O'Neill tells The Telegraph. 'With ever-growing challenges of under-funding and cost pressures, international tuition fees became the obvious way for the university to cross-subsidise the other core elements of our activities, to cover the costs of teaching and of carrying out research. But it left us extremely vulnerable to economic shocks and to changes in immigration policy.' Dundee is 'not alone', he adds. 'Higher education is an unstable sector in terms of finance, and international fees have become the main way for most universities to source the income they need to support their ongoing activities. And, like Dundee, they are vulnerable too.' Analysis of Dundee's financial strategy over the past decade reinforces how voraciously the university pursued fees from overseas students – and, in turn, how dependent on them it became. In 2014, the university accepted 582 international students (around half from China), while tuition fees from non-EU residents totalled £16m, just 38 per cent of the annual fees income. The same year, university leaders outlined a plan to boost international funding, stating that 'the best source of potential income growth' came from 'increasing the number of overseas students.' And after a determined marketing and recruitment campaign, the policy became a runaway success – at least in the short-term. Year on year, the university bolstered its international profile while numbers of foreign students soared – each one paying tuition fees up to five times higher than those for UK students. In 2020, the university revealed fees from non-EU students had risen to £37m, more than half of the overall fee income for the year. By 2023 Dundee had undergone a radical transformation, with more than 30 per cent of the total student population coming from some 120 different countries. The biggest international cohorts included 871 post-graduates from Nigeria and 580 from India, while tuition fees from non-EU overseas students had rocketed to nearly £78m – two-thirds of the yearly fee income. The university's annual report for 2022/23 noted 'continued growth in international student recruitment above ambitious targets' and predicted 'further growth in international students,' before concluding: 'The outlook for the next academic year is positive.' The glowing report was published in July 2024. But just four months later, seemingly out of the blue, the university announced its £35m deficit, a black hole which, according to Prof O'Neill, almost proved terminal. 'However keen we were to avoid it, we had to be honest: one scenario was insolvency, that we simply wouldn't be able to continue,' he says. An independent investigation is currently examining why and how the university's financial position deteriorated so seriously and so suddenly. There is no suggestion of criminality, and although Prof O'Neill won't pre-empt the inquiry's findings, he admits the university suffered from 'inadequate financial discipline, poor investment decisions, and inadequate oversight of our financial position, not least in ensuring our strategic ambitions were underpinned by financial rigour.' Aside from questionable decision making, other factors coincided to expose the university's over-reliance on foreign funding. Economic turmoil in Nigeria in 2023, for example, ushered in rampant inflation and rapid devaluation of the currency, the naira. The knock-on effect for Dundee – where one in ten students at the time was from the African nation – was a sudden collapse in applications. Damaging too was the policy shift introduced by the last Conservative government, which came into force in January 2024 and made it harder for students to obtain visas for spouses or children. 'Typically our Masters programmes are attractive to young professionals who come here from overseas to study, enhance their career prospects, then go back to better jobs,' says Prof O'Neill. 'In the years after Covid, our international numbers spiked and we had a lot of additional intake from Nigeria, India and South Asia, many of whom already had young families and would bring dependents with them. But the change meant our taught post-graduate students could no longer do that – so many decided against coming here, which hit us hard.' The issues at play have meant that since 2023, the number of international students at Dundee has dropped 62 per cent. 'It highlights how vulnerable we are to significant policy changes around immigration that have happened in the recent past – and could happen again in the near future,' Prof O'Neill says. Looking ahead, Labour's move to launch an immigration crackdown is likely to have an impact on already struggling universities. The government's plans include reducing the time overseas graduates can remain in the UK after completing their studies to just 18 months and charging institutions a 6 per cent tax on overseas fees income. Prof O'Neill says Dundee and other higher education providers face a dilemma as they struggle for funding: despite overseas fees being uncertain, the current system means they remain potentially lucrative. Tuition fees for undergraduates from England, Wales, or Northern Ireland are capped at £9,535 a year. Meanwhile Scottish students at Scottish universities do not pay fees but are funded by the Scottish Government, which contributes just £1,820. By comparison, foreign undergrads pay £22,500 year to study for a Masters degree in English, and £53,370 to study medicine. 'The current fee model has led to severe structural underfunding, which means we can't really cover the costs associated with administration, teaching home students or carrying out research,' Prof O'Neill says. 'Dundee has a global reputation, particularly in bio-medical and life sciences. And while our high quality work attracts a lot of research income, the available grants typically don't cover us fully, leaving a funding gap that has to be filled by the institution itself.' He adds: 'Every university tries to be as good as possible and attract as much research income as they can, but the more successful they are, the more they have to generate finance in other areas – such as fees from international students – so they can support that research.' Earlier this year, the Office for Students (the independent regulator for higher education in England) warned that the risk of a large university in Britain suddenly going bust has increased significantly, with the sector's finances performing worse than expected in the second half of 2024. It modelled a drop of £3.4 billion in net income across the sector in 2025-26, warning of 'pessimistic' forecasts which increase the likelihood of the sudden demise of a 'large provider'. Umbrella body Universities UK has echoed those concerns and urged the government to reconsider its proposed tax on international students. Chief executive Vivienne Stern says: 'Universities have had to make serious cuts as a result of visa changes which have decreased international student numbers, a downturn in per-student funding, and funding failing to cover the cost of research. 'Individual providers are doing everything they can, but we need the government to do their bit. That means increasing per-student funding; stabilising international demand; and working with us to sort cost-recovery rates on research. We also urge the government to think carefully about the impact the proposed levy on international student fees will have on universities.' Meanwhile, at Dundee, the impact of the financial crisis is plain to see: looming redundancy for more than 300 staff, departments being streamlined, research programmes and teaching modules facing the axe, and a call for millions more in bail-out funds. 'Despite what has happened, we have been able to survive as a recognisable entity,' says Prof O'Neill. 'But sustainable recovery means changing everything: our size and our shape, our structure and our balance of activities. 'As it was, the University of Dundee was simply not affordable.' Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.
The Courier
03-05-2025
- Business
- The Courier
The Courier says Dundee University crisis is far from over
Dundee University's revised recovery plan is a welcome step forward that no one should mistake for a happy ending. Interim principal Professor Shane O'Neill deserves credit for steadying the university in an almost impossible situation. Faced with a £35 million deficit, furious staff and the erosion of political support, he worked quickly to revise a plan that softens the immediate blow to the university community and restores some stability. But let's be clear: it was not consultation that provoked the change of heart. It was strong-arm tactics from the Scottish Government, despite its insistence that the university is autonomous. Ministers made clear that the original plan – with more than 600 job losses – was politically unacceptable. The university's new path is therefore a compromise designed to navigate political pressure as much as respond to financial need. That trade-off creates new dangers. By relying solely on voluntary severance, Dundee risks the departure of talented staff it cannot afford to lose, while preserving roles that add less to its future strength. Without the ability to shape departures strategically, the university may find itself weakened in ways no leader would choose. And the plan's financial assumptions are far from guaranteed. Major new public funding is still under negotiation. Commercial borrowing must still be secured and then repaid at potentially significant cost. Meanwhile, Dundee must compete for students in an increasingly challenging market, with no guarantee that the shadow of crisis will not deter applicants. UK Government policy decisions also play a major role in the wider crisis across the higher education sector. The tightening of immigration rules, making the UK less attractive to fee-paying international students, shows no sign of changing. Dundee University is paying the price. Other external forces add further risk. Inflation, interest rates and global instability all threaten fragile budgets. And next year's Holyrood election also looms large. A change of government could tear up current funding discussions overnight, leaving the university's future hinging on short-term political goodwill. Nor can Dundee assume special treatment. Other Scottish universities face serious financial challenges. Without a broader solution to the broken model of higher education funding, the problems will inevitably recur and spread across the sector. In that context, Labour's Michael Marra deserves praise for galvanising the political pressure that forced the government to act and for keeping the crisis firmly on the national agenda. Ministers who had initially been reluctant to intervene moved significantly – and that shift helped make this alternative plan possible, even if the dangers remain. The Courier believes Dundee University is not just important – it is essential. It is a centre of research that changes lives, a driver of economic growth and a symbol of the City of Discovery's ambition and pride. Dundee's future is inseparable from the university's continued success. Allowing it to decline would be a betrayal of not just the university community but Dundee and the wider Tay region. That is why the path forward must be more than cautious recovery. It must be a bold reimagining of what Dundee does best – investing in world-class teaching, research and innovation. It must be open and accountable at every turn. And it must be accompanied by a wider reform of Scotland's higher education system as a whole. This is not the time to patch over the cracks at huge public expense – only to face another crisis in 18 months. The Courier demands something lasting and sustainable. Professor O'Neill has stepped up when others deserted, to take charge and buy precious time – but that longer-term goal remains worryingly distant. If Dundee University is to thrive – not merely survive – it will need bravery, vision and a Scottish political class willing to match its ambition. The Courier will stand with the university and this city every step of the way. We will ask hard questions, demand better answers and fight for the future. After all, those are the attributes the university instills in its students – and the same qualities it now desperately needs from Scotland's leaders.
The Courier
02-05-2025
- Business
- The Courier
5 threats facing Dundee University as it battles to recover
Dundee University's alternative recovery plan has been met with cautious optimism – but some threats and risks remain. In the days after the first attempt at a potential solution to the £35 million crisis, First Minister John Swinney made clear it wasn't acceptable. With some form of public funding required to support the rebuilding exercise it was clear the university would have to go back to the drawing board. The result is a fresh attempt to set out a path to sustainability that has led to a pause in potential industrial action from outraged staff and more positive signs from the corridors of power – even with a hefty price tag attached. But what are the risks? The Courier examines potential pitfalls that still exist. Uncertainty over the crisis, and admitted mismanagement, are at the heart of the risks. Appearing before Holyrood's education committee, Interim principal Professor Shane O'Neill said he could not rule out potential criminality. Several investigations are ongoing, including a probe led by Professor Pamela Gillies with the help of international audit firm BDO. The university's auditor, Ernst and Young, is also understood to be carrying out its own assessments. A previous Holyrood education committee, attended by senior mangers, led to a series of explosive revelations that knocked the confidence of staff, students and even affected negotiations with the university's bank. We revealed on Thursday that the institution's charity status could be at risk after it failed to submit its annual accounts on time. While applications from home students are up there are fears some may opt to study elsewhere as a result of the damage caused in recent months. The exodus of senior managers also posed problems, leaving a small group to run the university. Prof O'Neill, who was the former principal's deputy, says he plans to remain in post but he may be criticised by the reports into how the crisis developed. Any sudden change in the leadership, and an urgent need to recruit new senior managers to the top of the university, could prove difficult. The biggest risk – and the university's main revenue generator – is student recruitment. The sudden financial crisis was in a large part down to significant challenges attracting people to study at the university in 2024. Of the £35 million deficit that left it facing a cash crisis around a third was down to an under-recruitment of international fee-paying students. There was also a under-recruitment of Scottish students. In addition to a reduction in fee income, this also meant the university had to shell out around £2 million for under-occupied student halls operated by private companies. Many of the challenges that led to this recruitment fall still exist – such as immigration changes which made the UK less attractive for postgraduates looking to study abroad. These are seen as unlikely to change. The international market remains extremely competitive and parts of the world the university targets, such as West Africa, continue to have fragile economies. The Scottish Government funding settlement for Scottish students is also unlikely to change significantly, meaning the sector will still rely on international income to make up the shortfall between what it receives for each home student and what it costs to deliver their education. The Scottish Government has been clear it is prepared to consider further requests from the university for assistance. It is expected the total cost could be around £60 million over two years, including financing for the voluntary severance scheme and potential liquidity support. The university is also locked in negotiations for access to a commercial lending facility and access to this could prove crucial but may be dependent on student recruitment and the ongoing reputational damage. The Holyrood election also looms large next year, adding an element of political uncertainty. While there is a cross-party political consensus that Dundee University is 'too big to fail', a new government in power in Edinburgh could make a different choice about how much support it provides. The university has ruled out compulsory redundancies and will first seek to achieve a reduction of 300 full-time equivalent roles through voluntary severance. This will free up around £20 million and while Professor O'Neill says he believes the figure can be achieved, it will depend on staff choosing to take up the offer. But using a voluntary severance scheme also cedes some control over who is lost from where in the university, with the departure of key staff from the wrong areas a possibility. 'We will try to manage it as carefully as possible, so that we're not seeing exits of staff from areas that are already overstretched,' Professor O'Neill told The Courier previously. A worsening economic picture is another potential risk outwith the university's direct control. Policy changes by the UK Government, such as an increase in employer's national insurance contributions, has made staffing bills more expensive. And across the world, potential economic uncertainty has also increased costs in areas like the delivery of capital projects.
The National
29-04-2025
- Business
- The National
Dundee University 'backtracks' on job cuts in new plan
Due to a £35 million deficit, the university had initially said it would need to shed 632 full time equivalent (FTE) positions, which would impact around 700 members of staff. But under new proposals devised and released on Tuesday, 'up to 300' FTE will now be lost through a voluntary redundancy scheme. READ MORE: Scottish university staff set to strike at troubled institution Previously, the university had been unable to rule out compulsory redundancies. Under the new plan, the institution will also seek to borrow cash, as well as changing to a new operating model through the 're-configuration of our academic units and professional services'. But on Tuesday, principal Professor Shane O'Neill said the new plan will need to be backed by 'significant additional public funding'. 'A new alternative approach was presented to the university court this morning and they have given their endorsement to this as a revised direction of travel towards financial sustainability,' he said. O'Neill said: 'There are still several challenging steps to be taken in order to clear this pathway to progress. 'We also need to ensure that the steps we take do succeed in allowing us to access commercial lending, as that will be essential for long-term sustainability. 'The proposed route forward will require significant additional public funding. We are engaged in discussions, through the Scottish Funding Council, as we look to secure that support over the next two years, including any related conditions and assurances. 'Further liquidity support funding may also be required. READ MORE: Green MSP becomes rector of struggling Dundee University 'We are now working to develop the full details of the proposed pathway and on plans for implementation. This will include details of a voluntary severance scheme. 'We will continue to engage with staff, students and union leaders as we consult on the details of this alternative way forward and begin to implement it. 'This is a significant step towards a more sustainable future for the university and the ongoing delivery of excellent education, research and enterprise.' The announcement comes as dozens of protesters gathered outside the Scottish Trades Union Congress (STUC) annual congress in Dundee on the issue. Campaigners marched from the university campus to outside Caird Hall in Dundee, where the STUC Congress is taking place until Wednesday. Campaigners gathered outside Caird Hall in Dundee against the planned cuts at Dundee University (Image: Andrew Milligan) As a result of the revelations about the university's financial woes, the Scottish Funding Council (SFC) launched an investigation into the cause, led by former Glasgow Caledonian University principal Professor Pamela Gillies. The University and College Union (UCU) Dundee Branch welcomed the university "backtracking" on its original plans. READ MORE: Scottish university warned by union body chief not to use staff as 'cannon-fodder' Branch co-president Melissa D'Ascenzio said: 'It is a relief that University management has backed away from the brutal plans to cut up to 700 jobs. 'This backtracking is in no doubt down to the relentless pressure from UCU, from all the campus unions and the support they've received from the city of Dundee, local communities and from across the political spectrum. 'Given the news of this new plan, we're urging the employer to take compulsory redundancies off the table, so as we can work with the employer towards a sustainable, successful university that values its staff and students, and continues to deliver the world-class teaching and research.'
