Total income accrued by UK universities grew during the 2019-20 academic year – despite more than four months of the year being disrupted significantly by the outbreak of the Covid-19 pandemic.
The latest financial figures published by the Higher Education Statistics Agency (Hesa) show that total income derived by the 183 institutions whose financial year matches the academic year reached £40.8 billion in 2019-20 compared with £40.4bn in 2018-19. Over the same period, expenditure for these institutions dropped from £43.9bn to £37.3bn. Including all institutions whose financial and academic calendars differ, total sectoral income increases to £41.9bn in 2019-20 from almost £41.5bn in 2018-19.
The financial figures – usually published in March/April – were delayed this year because of the pandemic.
These figures support analysis published last month by the Office for Students, which monitors universities’ financial sustainability, that said university finances were in “broadly good order” despite the pandemic.
However, financial figures for 2020-21 are needed for a full assessment.
The Hesa data appears to show that fewer universities concluded the 2019-20 year with a deficit than the year previous; of the 183 reporting higher education providers (HEPs), 120 were in surplus and 63 a deficit at the end of July. One hundred and eleven of the 180 institutions that submitted returns to Hesa for 2018-19 were in deficit at the end of the year – and 69 were in surplus. However, the statistics agency urged caution “in any interpretation of financial operating performance in 2018/19 and 2019/20”.
“Some HE providers saw significant cost adjustments in both 2018/19 and 2019/20, relating to the accounting treatment for the value of pension schemes,” the agency explained. This factor “is an accounting non-cash adjustment” and “not a typical annual operating expense/credit” and caused some universities to report deficits in 2018/19 and others to report “unusually large” surpluses in 2019/20.
The value of current assets for providers are £21 billion, and capital expenditure data shows a total spend of £4.1 billion. Universities’ income from tuition fees and education contracts grew to £21.5bn in 2019-20 from around £20bn in 2018-19. A drop in overall income from research grants and contracts offset this increase.Research incomes dropped from around £6.6bn to £6.3bn. Conferences and accommodation income fell from around £7.7bn to £7.3bn.