UCC finance chief says sector needs new funding model

Revenue at UCC from international students at €32.4m was down €4.5m year on year.

The Chief Financial Officer at University College Cork has warned that the funding model for third-level education "threatens the sector’s ability to deliver such services in a sustainable manner".

New financial statements for the year 2021 showed that student numbers are increasing at the university, along with student fee income, and the overall financial picture for the university is positive. However, there was a longer-term warning about the financial pressures on the higher education sector.

In its consolidated financial statements for 2021, signed off in December last year and now before the Oireachtas, Diarmuid Collins, Bursar/Chief Financial Officer for UCC, said the impact of the pandemic would continue but the university was confident it will "emerge positively".

"Post covid-19, a decision on the long-term funding model for the Irish Third Level Sector, as highlighted in the Cassells Report, has now crystallised, where the over 50% dependency on non-state income, that UCC and other Irish Universities have become dependent on to subsidise and deliver teaching for Irish students, now threatens the sector’s ability to deliver such services in a sustainable manner.

"The ongoing decline in capital support, as outlined last year, continues to be of major concern.

"The existing recurrent funding model assumes continued exchequer support for ongoing refurbishment, maintenance and infrastructural capacity needs. While the re-introduction of devolved capital grants in 2020 and renewed in 2021 to support the maintenance of the physical campus is welcome, the absence of capital grants will be a real barrier to meeting future demographic demand, as the level of recurrent funding provided for students will not sustain borrowings to fund essential infrastructural investment."

At the impact of the pandemic, there was an overall group surplus of €8.24m "achieved through robust budget management", and income streams that included State Grant income of €5.1m of Irish Government covid-19 support funding and €1.7m of Irish Government and EU grants included in other operating income, mainly in respect of Government wage subsidies received due to the covid-19 pandemic.

"The University stand-alone financial statements, before investment gains, recorded a deficit of €401k in 2021," it said. "This operating deficit reflects the ongoing systemic funding challenges across the HEI sector."

Revenue from international students at €32.4m was down €4.5m year on year, arising from the full-year impact of covid-19 international travel restrictions, particularly on Junior Year Abroad programmes.