2020 was expected to be a year of celebration for the University of the West Indies St Augustine.
It was the year the campus commemorated its 60th anniversary of operation.
As has been the case for many since the COVID-19, any such celebration was greatly muffled in comparison to what may have been previously arranged.
Sharon Christopher, chair of the Campus Council for the St Augustine campus in its annual said, “Under normal circumstances, this report would be a golden (actually diamond) opportunity to look back at the 60-year history of this campus, to bask in its achievements and to peer tentatively into some hazy future. However, the COVID-19 pandemic has delivered that far-flung future to our doorstep with warp speed—the ultimate in overnight delivery! And as the events of the past year have proven to the world, time is a luxury none of us should take for granted.”
The pandemic forced the campus to do some financial pivoting, with a significant amount of give and take as a result.
According to the St Augustine campus’ annual report total funding for the financial year ended July 2020 stood at TT$1,026.9 million.
The report noted this figure reflected a decrease of TT$13.5 million or 1.3 per cent below the previous year.
The report said that while government subventions stayed basically flat for the past four years at TT$535.6 million, the university listed three items which they were monitoring going forward for their impact on funding, these are Tuition Fees, Special Projects and Commercial Operations.
The report stated, “Tuition and other student fees showed a 2.5 per cent decline when compared to the year ended July 31, 2019. Population demographics shows a declining number for students in the age cohort to enter university. This trend is expected to continue for the next five years.”
But the St Augustine campus noted that based on the economic environment brought on by the COVID-19 pandemic, “even more has to be done to maximise efficiency.”
In this case it meant that some cuts had to be made.
To achieve this the report noted several strategies to reduce costs were adopted. They included Freezing unfilled positions; Staff reductions due to attrition; Service contracts to part-time teaching staff reduced from one year to nine months; Renegotiating service agreement contracts with vendors to reflect a 15 per cent reduction in cost; Reorganisation of workflow to reduce overtime Impact; 15 per cent reduction in costs over time.
The report also noted that the Campus Grants Committee Budget was decreased by $100M over the past four years.
In spite of this, funding for operations, which is being increasingly paid for from the self-financing efforts of Campus, UWI still recorded a deficit of TT$30.5 million for the year ended July 2020.
The report said, “The surplus recorded before provisions for depreciation, employee benefit obligations was TT$81.7 million, however operations are not generating sufficient funding to replace its plant, as reflected in the charge for depreciation, or fund the growing pension liability, as evidenced in the charge for employee benefit obligations, hence the deficit recorded for the year.”
The pandemic essentially crippled student and as a result commercial activity at the campus. This translated to bad news for properties owned, operated and tied to student activity on or around campus as that ultimately led to jobs being cut.
“The impact of the COVID-19 pandemic hampered the operations of University Inn and Conference Centre managed by the St. Augustine Campus Enterprises Co. Ltd. (SACEL). In April 2020 the SACEL Board took the decision to close the operations of the Inn and Conference Centre and retrench the affected staff,” the report said.
Other Commercial Operations tied to the Bookshop, Central Stores, Multi-media Centre and Student Halls of Residence and the rental of commercial spaces on Campus also took a hit.
The report noted that “Revenue of TT$24.3 million represents a 26.8 per cent decline over the previous year with the immediate closure of the Campus and its halls of residence on the onset of the pandemic.”
File picture: UWI students at the St Augustine Campus.
With the pandemic still massively affecting the campus, the university is expecting a similar decline for 2021.
There were other factors that also contributed to waning income to the University; the adjustment to GATE funding.
The report noted that “Special Projects and other project income of TT$70.2 million included the gross income earned by UWI ROYTEC valued at TT$25.1 million and SACEL of TT$1.7 million. The comparative for year 2018/2019 was TT$87.3 million with UWI ROYTEC’s gross revenue totalling TT$27.4 million and SACEL’s TT$2.8 million.”
While TT$13.9 million of this decline came from Campus operations where the immediate impact of COVID-19 may have affected the execution of the required research, the report said, “UWI ROYTEC’s decline in revenue was due to reduced enrolment in foreign accredited programme offerings because of the withdrawal of GATE support for students.”
The pandemic did, however, to some extent save the University some money on overseas travel.
The report noted, “COVID-19 has had both a positive and negative impact on overall expenditure. Savings from reduced overseas travel expenses and utilities were absorbed by increase ICT expenditure in software upgrades and maintenance fees required to support online teaching.”
The report said, “Total expenditure for the year before depreciation, employee benefits obligations and finance costs totalled TT$945.2 million, a decrease of approximately TT$62 million or 6.2 per cent. This decrease in overall expenditure mainly reflects the reduction in staff cost because of the provision for back pay in the previous financial year.”
2020 was also the year the university was expected to welcome the Penal-Debe Campus into its fold while also incorporating the Couva Hospital and Multi-Training Facility, instead both have become key components of the country’s stand against the virus with the hospital housing some of the most severely affected COVID-19 patients.
This was not the only way the university inadvertently found itself at the forefront of the country’s fight against the pandemic.
“Our experience with COVID-19 shows us that one never knows how an investment made today could lead to invaluable rewards later. For instance, the investments in a Faculty of Medicine at the St Augustine Campus in the 1980’s was frowned upon at the time in some quarters. However, we are reaping the rewards of that investment today in the form of a robust public health system. Similarly, the investments in two recent projects unexpectedly contributed equipment and expertise that bolstered the country’s capacity to conduct PCR (Polymerase Chain Reaction) testing. None of these were intended outcomes, but these and other investments over the 60-year history of our Campus have yielded significant value,” said Christopher.
But the St Augustine campus is not the only one of the five UWI campuses that has been facing financial difficulties.
And the pandemic has not been the only cause of the problem.
According to UWI’s financial report and combined accounts for the year ended July 31, 2019 the university made a total comprehensive loss of US$52.9 million.
The year before that the loss was US$32.1 million.
UWI started as a university college of London in Jamaica with 33 medical students in 1948.
Today it boasts of almost 50,000 students and five campuses: Mona in Jamaica, Cave Hill in Barbados, Five Islands in Antigua and Barbuda, its Open Campus, and St Augustine in T&T.
It is a “not-for-profit” educational institution providing higher education to 17 contributing Caribbean countries.
Now its Vice-Chancellor Professor Sir Hilary Beckles has launched Operation Revenue Revolution 75+ (Operation RR75+) “dedicated solely and exclusively to addressing its financial sustainability.”
Beckles noted that in the prior five-year operational plan, themed “The Reputation Revolution”, the University focused on rebuilding its brand, and radically upgrading its reputation regionally and globally as a pre-condition for the second phase.
“We could not go to the region and world for resources and development partnerships with our brand and reputation in question. We had to put our house in good order before going out into the very competitive higher education world,” Beckles said.
UWI is now ready for a “fully fledged revenue revolution,” Beckles said.
“The COVID-19 pandemic for us is not a game changer, but a super accelerator. Our thoughts and strategies preceded the 2020 catastrophe,” he said.
Chairman of Caricom, Prime Minister of Antigua and Barbuda Gaston said the contributing governments are solidly behind the regional university in leading financial reforms for greater autonomy and endorsed the quest to radically alter its financial circumstance.
Beckles said the university cannot continue to grow, innovate, and prosper solely within its domestic financial base.
He recognised the devastation of the regional economy by COVID-19 leading to governments’ inability to fund it at approved level.
And argued that the global gaze was now at centre stage within the five-year operational plan.
“The Vice-Chancellor noted that the current funding model, characterised by large government arrears and subsequent impairment and write-offs, produces a budgetary gap that must now be closed,” a release from UWI stated.
“Despite the fact that the deficit drivers are outside of management’s control, we are owning them, and taking on the project of closing the gap by generating cash to end the 30-year-old era of deficit financing and moving to balance budgeting within two years,” Beckles stated.
Operation RR75+, which sees its first target as the 75th anniversary of the University in 2023 and looking beyond, seeks to create a funding model as follows:
• 50 per cent revenue from The UWI’s contributing Caribbean governments and 50 per cent revenue from the University’s entrepreneurial actions including:
• 20 per cent regional student fees
• 10 per cent international student fees
• 10 per cent business activity
• Five per cent private sector investment
• Five per cent endowment sector (including alumni)
1. The University will see significant activity on both sides of the balance sheet, beginning with a 10 per cent expenditure reduction per year, for two years.
2. On the revenue side, the University will implement its Ten Point Financial Plan; in this context the following projects have already been initiated:
• Each campus will develop bankable projects for income generation, and principals will be held accountable for their capacity to inject financial outcomes into campus budgets.
• The UWI Enterprise will be launched as a holding company designed to promote commercial activity across the campuses with ‘spin offs’ and incubators in all faculties.
• The University intends to take its business enterprises to regional capital markets through the offer of UWI Business Bonds and related financial instruments.
• The commercialisation of The UWI’s vast intellectual property will be initiated as soon as its IP policy is approved.
• The projected launch in 2022 of The UWI Global Campus, building on the footprint of the existing Open Campus, will drive international students into The UWI system. This will be a self-financing online ‘for profit’ campus. The Global campus is expected to deeply impact the traditional operations and financial trajectory of the University.
• There will be an intensification of entry into new regional markets, especially in the areas of micro-credentialing offerings and commercial oriented academic services.
• There will be a new drive into the endowment market, particularly to secure resources for large scale regional research, and scholarships for historically marginalised students.
• There will be a revamping of the regional and global alumni giving operations.
• New global partnerships will be placed on a sound commercial footing in order to promote a value added business culture within faculties and research institutes.
• Conversations will be intensified with governments and the private sector in order to create university owned land bank, and a private sector Investment Fund for institutional and infrastructural development.
“These strategies are already in action, some more advanced than others, and are already impacting the governance model of the University, while changing its business culture,” UWI stated.
“The grand objective is to enhance the financial strength of the University, stabilise the contributions of governments, reduce costs to regional students, and transform overall governance in the best interest of the public academic institution,” it stated.
According to Vice-Chancellor Beckles, “The UWI will emerge as a hybrid academy, maintaining its identity and brand as the region’s premier first-class ‘public good’ university, while containing and driven by a robust commercial, income-generating operation dedicated to creating a sustainable self-financing enterprise. Operation RR75+ is therefore the tipping point in the 21st century journey and evolution of The UWI. It’s a programme of systemic change and transformation. It’s the final phase of the change culture long anticipated. It’s a partnership model in which academic leadership will partner progressively with owners of private capital with development goodwill, and with the global community with a consciousness of commitment to the advancement of the Caribbean. The ‘for profit’ element will not engage predator private wealth owners but will seek out and work with ethical development investors and those committed to Caribbean nation building.”