A Fiscal Black Box

I’m not sure if it was sensible to agree to join the blogosphere with an initial contribution on University Finance? It is not an inherently riveting topic and there are precious few chuckles in it other than the observation that if a university is not in debt it probably lacks imagination, but the chances are its Vice Chancellor will get a knighthood. The problem is that unless you move out of academic life to become an administrator, which I tried for a while and found deeply disheartening, university finances are an incomprehensible black box out of which rather inexplicable edicts emerge.

When I was a Head of Department I was so keen to divest myself of fiddling with the finances that I divided people up into groups and gave each a budget based on what they had spent in the previous year. Happily, and not surprisingly, everyone spent their budget up to the hilt so the department’s overall finances were neatly in balance without me really trying. But the person who took over from me quickly reverted to the standard central control. Perhaps it should be expected that she then went on fairly quickly to be an excellent Vice Chancellor.
Profitless service
The black box approach, though, means that the people who actually make the system work, the lecturers (not the administrators who like to think of themselves as ‘the centre’) have no real commitment to financial prudence. Indeed one of the great insights of organisational psychology is that there is always an inherent conflict between the organisations and the individual, never more so than over money matters. So with the funding squeeze that is being mooted as coming to a university near you there will be lots of senior administrators politely bemoaning the lack of resources for the library or that desperately needed sabbatical, whilst gently stroking their new leather chairs.
The problem is that universities don’t actually make anything and unlike other service industries they are not supposed to turn a profit by charging their customers more than it costs to provide the service. So administrators can only see student numbers and grants awarded as ways of assessing what is going on. Even the heart blood of research, publication, has to be assessed by some committee or ‘impact’ calculations rather than being allowed to exist on its own merits. Therefore the reduction in the money available is likely to be in all those areas that are not open to easy evaluation, notably allowing people to get on with what they think is worthwhile.
Eating the seed corn
The most likely consequence of the financial cut-backs that are building up for universities is further reductions in support for research, especially unfashionable research that is not endorsed by the academic establishment. I think that would be like people who are starving eating the corn that really should be kept to grow next season’s food. Universities are privileged places but these privileges are provided to allow intellectual innovation. That is the educational, industrial and commercial food of tomorrow. There is so much pressure already on UK academics that any reduction in the opportunities to explore rather than teach will drive them even further away from any really original research.
I know from editing journals over many years that if I ask a UK academic for a review I will be lucky if I get it back within a few months. Such a request to someone in a US university is likely to get a response within a few weeks. The same article will typically be reviewed by people in Northern Europe within a few days. I take this as empirical, if rather anecdotal, evidence not that UK lecturers are lazier, but that they are under more time pressure and also the need to focus what spare energy they have on tasks that they see as directly of value to their research assessment profile.
The consequence of all this is that the financial is just to the average lecturer or student. I’m no historian but I get the impression that when Henry VIII took time out from choosing wives to get rid of the monasteries he left more or less untouched those places that offered an education. Monasteries are run by monks for monks to do what monks do. So although the older universities today do apparently allow their staff to marry, they are still run broadly as if they were secluded cloisters in which what the Abbott says has a deific, unquestioned authority. But if they really want staff to take finances seriously they are going to need involve them much more in the management of the university’s funds. Without a feeling of being part of the problem academics will think that edicts from on high are an irrelevant solution.
David Canter is Professor of Psychology at the University of Huddersfield and Emeritus Professor at the University of Liverpool.
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David Canter

Professor David Canter, the internationally renowned applied social researcher and world-leading crime psychologist, is perhaps most widely known as one of the pioneers of "Offender Profiling" being the first to introduce its use to the UK.

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Patrick Tissington

We seem to be develoing some common ground (and by the way of course intellectually heavyweight!) But would you want the designers to be in charge of finances at a car manufacturer, or the engineers at a rail company? Or the doctors in the NHS?

Pat Tissington

Far be it to disagree with the eminent Prof Canter who is a colossus in the field of psychology. But I do. In my view, his example of financial management of a department is probably one of the better ways of doing it I have seen for the people concerned at any rate. It certainly led to less hassle and more time for his research than actually taking an interest in it. I suspect he, in common with most department heads, might not have had all that much training before taking over the role and therefore he did not have… Read more »

David Canter

I totally agree with Pat (except that bit about me being a colossus- I am proud to say my weight is well under control). Academics, right the way up to the highest levels of Unversities, have woefully little training, or support, in managing the finances that they are required to look after, although it has marginally improved over the last quarter of a century. But the central point of my comments still stands. If academics ar not an integral part of financial decision making in universities you cannot expect them to take the university’s financial decisions too seriously. Indeed they… Read more »

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