Many universities in England are feeling financial strain, with a recent report by the Office for Students warning that 40% of England’s universities are expected to run budget deficits this year.
This hasn’t happened overnight; there has been a culmination of factors in recent years which have contributed to this. The most significant of these being the pandemic and, although students are now back at university, behaviour has changed. Blended learning is commonplace, with data gathered by the BBC revealing that almost a third of university courses are combining face-to-face teaching with online learning for the period 2022-23, compared with 4.1% in 2018-19 (before the pandemic).
Equally, some campus facilities are being used differently, leading to existing cleaning schedules no longer being necessary, heating and airflow systems not needed in the same way and, in some cases, the spaces no longer being used at all.
Brexit has also impacted the number of EU students choosing to study in England, as they now face increased fees. Data from the Higher Education Statistics Agency shows the number of students from the EU who enrolled for the first year of an undergraduate or postgraduate course was down from 66,680 in 2020 (the year before Brexit came into force) to 31,000 in 2021.
Tuition fees have also been frozen since 2017, and couple this with significant increases in energy, operational and labour costs since that time, and universities are facing the perfect financial storm.
There needs to be significant changes made before the situation deepens. One area that universities can review is their Facilities Management. Nearly always, there will be ways to make the operation more efficient and drive cost savings. Karl Cundill, Joint Managing Director at Litmus FM, shares his top five tips:
- Get to know your assets: This will help to reduce reactive maintenance costs. By ‘assets’ we mean all the operational equipment and systems in the facilities, so everything from the Heating, Ventilation and Air Conditioning (HVAC), lighting and fire systems to the boiler plant and kitchen equipment. Understand what your assets are, their condition and age. Get to grips with how much residual life remains in them and which assets are the key priorities that need to be replaced – and equally which can be replaced further down the line. Think of it like your car – you don’t wait until your car breaks down to get a service or MOT, you do it as part of the regular upkeep. This ultimately removes unexpected equipment breakages and hefty call out fees.
- Take a whole-life approach: The asset work needs to encompass a whole-life approach and align to the overall estates’ strategy for the university facilities. For example, if universities plan to mothball or demolish specific areas of the facilities in 5-10 years’ time, there is no point in investing or refurbishing those areas. Key buildings that are being retained need a Forward Maintenance Register (FMR), that covers the next 5, 10, 15, 20-year period, which identifies the priorities, available budget and when the upgrades can happen. Development of a detailed FMR will ensure universities can spot if there are any issues with how a piece of equipment or asset is working, catch it early and avoid the need for any call outs or equipment break downs.
- Ensure sustainability improvements are done in a holistic way: Instead of implementing one-off, short-term solutions – such as installing LED lighting – sustainability upgrades can be done in a holistic way if they are wrapped into the whole-life approach. They can be implemented as and when different parts of the relevant facilities are upgraded, resulting in less short-term spend and more long-term investment.
- Review how your people use the facilities: Are all the spaces being used wisely? We’ve worked with many universities since the pandemic which have consolidated their facilities post-lockdown. Are there large event spaces or halls that are empty half of the time and could they be re-purposed or mothballed completely? Are the catering areas still busy and popular, or have student eating habits and behaviours changed and do the food outlets need to be adapted, in line with these changes? Once you understand the space, then review how you service these areas. There is no point in heating an area for 10 hours a day if it is only used for five.
- Are your service providers the best partners for you: Given how differently some of the facilities are being used, it makes sense to review if your current service providers are the best fit. If the cleaning is outsourced, savings are likely to be made either through re-negotiation following a best value benchmarking review or by putting your contract out to tender. Taking cleaning services in-house can be a way to reduce costs, but should only be done following a robust options appraisal. Short-term savings can be quickly eroded without proper management systems, procurement expertise and ongoing staff development being established.
If you’d like help reviewing your university Facilities Management, then contact us here
The Litmus team