University of Nottingham's 'challenging' year revealed as £12m paid out during job cuts

The University of Nottingham paid millions out during a huge round of job cuts as it recorded a rare financial loss, new documents have revealed. The Russell Group university has recorded a loss of £17 million in the financial year up to July 31, despite drastic cost-cutting measures that resulted in hundreds of job losses and restrictions on buying books and coffee.

This was only the second loss the institution has recorded in the past 10 years, with officials attributing it to lower than expected student numbers and high inflation. The university's recently released financial papers explained it had spent £12.1 million on a voluntary severance scheme that concluded in July 2024, which was accompanied by a hiring freeze and cuts on all non-pay budget items.

A University of Nottingham spokesperson said: "This is a challenging time in the higher education sector, balancing the costs of investment with managing the impact of increased cost of living, increases on our services and decline in the real-terms value of tuition fees, while navigating a more uncertain student recruitment environment. We are continually reviewing spend and ensuring we are achieving best value as part of good financial management to help protect the financial future of the university.

"We remain in a strong position within the sector and continue to make informed decisions to ensure organisational resilience." UoN's accounts showed it had grown its income to £849.4 million through an increased number of international students and higher research-related income, but this success had been wiped out by cost increases.

Tuition fee income grew by £2.1 million to £437.5 million, driven by increased fees from postgraduate students and other fees. The university explained its strategy was to gradually increase the proportion of international students, who pay substantially higher fees than UK home students.

In January the University of Nottingham's Executive Board announced the institution was facing "challenges around our estate" and needed to address immediate maintenance issues, as well as dealing with the recent inflation and decline in real-term value of tuition fees which the board said had resulted in "unprecedented financial pressures" for UK universities. An ongoing transformation programme, referred to as 'Future Nottingham', had attempted to prevent an end of year deficit - but initial measures failed to stop the £17 million loss.

UoN's financial statements said that cutbacks and its voluntary severance scheme would "improve our ongoing operational efficiency", while plans for future organisational and financial stability would continue to be developed as part of the Future Nottingham programme. Academics at the University and College Union [UCU] have previously called for the university to reconsider the scale of its investment into its new "vanity project" Castle Meadow Campus, in light of the university's saving drive elsewhere.

The university spent more than £36 million to buy the 32,500 square metre former HMRC site in 2021 and has been refitting the inside of the office buildings to form the future home of its business school. Last financial year it invested more than £100 million on repairs to its estate and on developing the new campus.

Previously, the UCU claimed it had spent 90 percent of the project's budget, despite the fact it is scheduled for completion in 2025. It had committed £15.6 million to the refurbishment of the Castle Meadow Campus by the end of the financial year, its accounts explained.