University of Limerick records €700,000 deficit after overpaying for student housing

The provost of the university wrote to staff to inform them that the Higher Education Authority will be visiting UL in the coming weeks to speak with senior staff

Professor Shane Kilcommins, the Provost and Deputy President, said: 'There will have to be accountability for the substantial impairment in our financial accounts.'

The University of Limerick ended 2023 with a financial deficit of €700,000, staff have been told.

The deficit is the result of the university overpaying by millions of euro for student accommodation.

Professor Shane Kilcommins, the Provost and Deputy President, sent an email to staff on Friday morning telling them that a delegation from the Higher Education Auhtority will attend UL over three days later this month to meet with the full executive committee and individuals responsible for particular portfolios such as finance and governance.

“I am keenly aware that it is not easy for anyone to see a negative focus on the governance and leadership of UL rather than the excellence of what we do and who we are,” Professor Kilcommins said.

“There will have to be accountability for the substantial impairment in our financial accounts.” 

Last week, it emerged that UL President Kerstin Mey had declared herself to be “incapacitated” to appear before the Public Accounts Committee (PAC), some three weeks ahead of a scheduled appearance.

It came after a letter to staff which stated that the university had overpaid to the tune of more than €5m for 20 houses at Rhebogue, about 2km from the campus, and that the matter was to be investigated.

Ms Mey had been invited to the PAC to discuss that same transaction, which saw the 20 houses purchased for student accommodation in August 2022 for €11.4m, with the properties subsequently valued as having been worth just €6.2m.

This overpayment comes after a similar issue which saw UL bear a €3m loss on its purchase of the old Dunnes Stores building in Limerick city.

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“We intend to make it clear to the PAC that we will make ourselves available and that we will be utterly candid in our engagements with their questions,” Professor Kilcommins said.

“Prior to the inclusion of the impairments for the City Centre Campus and the Rhebogue development, the University anticipated a year-end surplus of €7.5m. The inclusion of the impairments will result in a deficit for the year ended 30 September 2023 of €0.7m.” 

The provost added it was essential that the university thinks “long and hard” about how decisions are made, how it communicates and how it improves culture through the organisation.

“In the interim this institution will continue to function, and I respectfully ask for your support and forbearance as we engage on these matters,” he said.

It is understood that UL officials may now not appear before the PAC until May.