Warwick seeks to cut staff numbers through voluntary severance scheme amid fears of ‘worsening’ finances

The University of Warwick has announced that it will begin a voluntary severance scheme for its staff, after the Vice-Chancellor admitted that savings must be made to manage rising costs.

In a letter to staff, seen by Research Professional News, Stuart Croft said that it is clear that the University’s financial position “will worsen” over the next five years, if no action is taken to cut spending.

He cited changes made by the government, including an increase in National Insurance contributions made by employers, as reasons for needing to make these savings.

The Voluntary Leavers Scheme (VLS), which will open on Monday (17 November), will seek to “address [the] cost challenge” faced by the University, and “produce savings to manage rising costs”.

A spokesperson for the University confirmed to The Boar that the scheme is solely a ‘cost-saving measure’, and that there are no plans to introduce compulsory redundancies at this stage

Employers often use voluntary severance and redundancy schemes to reduce their number of employees, with financial packages offered to departing staff. £10 million will be invested by the University into the VLS.

A spokesperson for the University confirmed to The Boar that the scheme is solely a “cost-saving measure”, and that there are no plans to introduce compulsory redundancies at this stage.

Any future redundancies would be carried out “through a completely different and separate process as a result of restructure which is not associated with this scheme”.

A spokesperson for Warwick’s University and College Union (UCU) branch also told The Boar that their members had “been assured that this scheme (as the name and process attest to) is voluntary, rather than mandatory”.

Impact Assessments, including for equality, will be carried out by the University throughout the process, with eligibility criteria and guidance provided to all staff.

Over 100 universities across the country have already launched redundancy or restructuring programmes, with a survey in August finding that as many as 20,000 higher education jobs could be at risk

The Warwick UCU spokesperson added that the branch will not “encourage or discourage members to take voluntary redundancy, as every member’s situation is different”.

Over 100 universities across the country have already launched redundancy or restructuring programmes, with a survey in August finding that as many as 20,000 higher education jobs could be at risk.

In the last week alone, staff at Lancaster, Derby, and Sheffield Hallam universities have either announced strike action or been on strike in disputes over compulsory redundancy schemes at their institutions.

Rising financial pressures on the UK higher education sector has been widely cited as the reason for many job cuts, with Warwick’s situation being no different.

In addition to a hiked National Insurance bill, which Croft said would cost the University an additional £10 million this year, the University is set to be faced with a 6% levy on international student fees, following a recent policy announcement by the government.

The plans to tax universities based on the size of their international student enrolment was branded as “impossible to defend” by Croft, who said it “overlooks the significant contribution that our international students already make to our community and our region”.

The Vice-Chancellor told staff that he will meet with government officials and politicians ‘to do all we can to mitigate the impact of [the international student levy] policy’

In his letter to staff, Croft added that the policy, which is estimated to cost Warwick £17 million a year, “must surely be subject to change”.

The Vice-Chancellor told staff that he will meet with government officials and politicians “to do all we can to mitigate the impact of this policy”.

Despite these recent policy changes, a spokesperson for the University told The Boar that Warwick is not currently “in financial difficulty” – the University reported a surplus of at least £46 million in the 2023/24 financial year.

Cuts to university spending, such as the VLS, are instead “part of a thoughtful and measured approach to support the University’s long-term financial future”.

Strong financial health ensures that we can remain competitive amid challenging global conditions and that we can continue to provide an outstanding teaching and research environment

University statement

This statement from the University aligns with Croft’s own forecast in his letter to staff. The University “can only deal with what we have in front of us now”, the Vice-Chancellor wrote, “that is the around £10m a year National Insurance payment [and] that is what we will be addressing with this Voluntary Leavers Scheme”.

Some of the savings made through the scheme are set to be reinvested into research, education, and the financial sustainability of the University, while other savings are likely to be used to counteract the “increased operational costs” faced by Warwick.

A University spokesperson concluded: “Strong financial health ensures that we can remain competitive amid challenging global conditions and that we can continue to provide an outstanding teaching and research environment for our students, staff, and partners.”

Correction (14 November): An earlier version of this article stated that the Voluntary Leavers Scheme would be a ‘voluntary redundancy scheme’. This has been corrected; the scheme is a voluntary severance scheme.