New report highlights importance of university sector

October 10th, 2014 Category: Colleges and Higher Education

Universities are able to generate billions from their estates, according to new research. Research published by the Association of University Directors of Estate (AUDE) has helped to unveil the impact of university estates and facilities across Britain.

The report entitled  ‘Higher Education Estates Statistics Report 2014’ revealed that the university sector has a turnover of £27.3 billion.

On average, educational institutions spend around £2 billion (excluding residential) on their facilities per year and occupy over 280 million sq ft.

The study helps to demonstrate the sheer amount of investment that universities are putting into their assets and services. It also highlights the positive economic impact that many higher education institutions have in the UK.

Sir Ian Diamond, principal and vice-chancellor of the University of Aberdeen, said: "The HE sector has undergone Copernican changes in recent years as the effects of budget cuts, tuition fees and soaring energy prices pile pressure onto a body already providing so much for so many. 

"This report shines a light on exemplary practice and should be mandatory reading for anybody facing cuts and similar changes. The university estate is, quite literally, the building blocks of our nation’s academia and future and should be supported and celebrated at every opportunity.” 

The research also compared the expenditure of universities to major corporations and firms in the UK. 

Its figures showed that collectively, universities were the among the top four profitable organisations in Britain. 

Tesco had the highest turnover at £63 billion, while this was closely followed by Vodafone at £38.3 billion. SSE posted a turnover of £30.6 billion, with the university sector just behind at £27.3 billion.

Universities spent £2 billion in terms of capital expenditure on their university estates between 2012-2013. In real terms, this equates to more than the average annual Crossrail budget which was recorded as £14.8 billion spread across nine years between 2009-18.

The sheer size of universities serve to demonstrate their importance and influence in the UK. 

The research found that UK universities occupy an area only slightly below the NHS estate (322 million sq ft) but more than two and a half times the governments estate (107 million sq ft).

Commenting on the findings, Andrew Burgess AUDE chairman and deputy chief operating officer of Loughborough University, said the report also highlights the need for effective estate management.

He added: "The EMS report once again shows the magnitude of what the Higher Education Estates sector produces annually, in terms of the work it delivers, the scale it covers and the people it provides for. 

"This report undoubtedly shows that good-quality estates management translates into a better staff and student experience which, in a climate of increased tuition fees, less income and added competition, is more valuable than ever."

However, universities have also been subject to a number of challenges over the years.

This is predominantly due to the rise in tuition fees which has helped to limit student numbers, in addition to growing competition and the rising costs of energy efficiency.

Similarly, in the run-up to 2010, the sector saw year-on-year increases in income. These rises were greater than inflation although now  its income has not been as fast growing with ever increasing costs.

However the report showed that, despite these challenges, universities have remained resilient, with total property costs declining and carbon emissions remaining stable.