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Financially sustainable Universities – Diversifying Income Streams. Thomas Estermann Head of Unit Governance, Autonomy & Funding Financing the Students’ Future (FINST) Consultation Seminar Liverpool, United Kingdom 25 November 2011. Profile of EUA. Established in 2001 - PowerPoint PPT Presentation
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Financially sustainable Universities – Diversifying Income Streams
Thomas EstermannHead of Unit
Governance, Autonomy & Funding
Financing the Students’ Future (FINST) Consultation Seminar
Liverpool, United Kingdom25 November 2011
…2…
Profile of EUAEstablished in 2001Non-governmental membership organisation 850 individual university members35 National Rectors’ Conferences Members46 countriesIndependent voice for the university sector
Financial Sustainability
Identifying costs of all
activities and projects
-“Towards full costing..”
- EUIMA - Full Costing
Diversification of income streams
- “EUDIS”
Sufficient and sustainable
public funding
- Monitoring of the crisis
UniversitiesFunders
Public authorities
State of playOn average, almost ¾ of universities’ funding comes from public funding sources
Additional income sources• diverse opportunities – some generate up to 25%
Contracts with the private sector
• Importance of competitive funding from foundationsPhilantropic funding
• Renting of facilities, catering, conferencing services, consultancy, merchandisingServices
• Treasury management (strategic investments)Financial management
• Framework programmes, Structural Funds, LLLEuropean Funding
…6…
Funding challenge 1:
Complex financial management
Some universities have more than a 100 funding sources! Different accountability regimes – high costs of compliance!
Funding challenge 2: Increasing co-funding
Do not cover the full costs of an activity Widens the FUNDING GAP
Funding challenge 3:European funding schemes: co-funding and
complexity
Impact of the economic crisis on higher education in Europe
How to improve the situation and foster diversification?
What can authorities do?Implement smart funding incentives: Matched funding schemes: instrument with much potential, under-
used in Europe
Improve funding modalities: Simplification of funding schemes Funding on a full cost basis
Support the development of full costing in universities
Improve framework conditions – autonomy and governance reformsSupport leadership development and professionalisation of management
What can universities do?1. Integrate income diversification in the overall
strategy2. Identify the strengths & specificities of the
university to develop a branding strategy 3. Analyse perspectives for income generation of
your activities4. Invest in people, leadership and management5. Communicate (internally and externally)6. Change structures and organisation 7. Provide internal incentives
Efficiency measuresInternal: Restructuring of academic units Centralising services Outsourcing services
Cooperation Sharing services, equipment, facilities Public private partnerships
Some aspects to keep in mind
1. Additional funding cannot replace sufficient public funding
2. To foster diversification, upfront investments are necessary
3. All actors need to work together!