The University of Dundee has announced a wide-ranging set of proposals towards a recovery plan to address significant financial challenges and achieve a successful future.

Professor Shane O’Neill, Interim Principal and Vice-Chancellor, said, “The current financial crisis has challenged us to ask some very fundamental questions about the size, shape, balance and structure of the University."

“The measures we are now proposing would make an essential contribution in our becoming a more appropriately balanced and restructured institution."

“Getting there will not be easy and we are determined to take on board all relevant lessons from the past and the various factors that contributed to the current position. We are committed to an external investigation into what went wrong, which will be co-sponsored with the Scottish Funding Council, and we will accept and act on the findings of that investigation."

“Savings in capital and operational expenditure have already delivered more than £17 million of savings this year, some of them being recurrent savings. We will continue to exercise tight control on all expenditure."

“We need to realise more savings and income from non-pay and operational expenditure associated with our estate and intellectual property."

“In setting out our proposals towards a financial recovery and a sustainable future we have adopted an approach of frank realism and honest self-criticism in our assessment of the current situation and the challenges faced."

“There is an urgency for us to act promptly and we will continue to work intensively with the SFC and other stakeholders to ensure delivery of the sustainable and successful future we need for this great University, which is integral to the economic, social and cultural wellbeing of the city, our region and beyond.”

The proposals towards the full recovery plan also include:

• A proposed new academic structure from eight academic Schools to three Faculties

• A review of teaching efficiency to achieve a 20% reduction in module delivery

• A restructuring and streamlining of Professional Services

• A reorganisation of research into a small number of focused research institutes to minimise institution-funded research

• A review of leadership, executive and governance arrangements

The proposed changes will require a significant downsizing of core funded staff. This rationalisation aligns to the reduction in the scale of our operations, our current and projected student numbers and the impact of teaching and research efficiency plans.

Staffing reductions will be made in every school and directorate of the University, amounting to 632 full-time equivalent posts – 197 academic roles, 119 school-based professional services posts in schools, and 316 directorate roles-based professional services roles.

The University is committed to seeking measures to avoid redundancies or to minimise their impact where possible. Opening a voluntary severance scheme and seeking volunteers for voluntary severance is one of the options available under the University’s Redundancy Avoidance Agreement and Code of Practice and is intended to mitigate compulsory redundancy.

However, the scale of the required staff reductions mean that it is very unlikely that the need for compulsory redundancy will be mitigated entirely, noting the depth of the financial challenge we face.

We are now moving formally into collective consultation on redundancy. The delivery of this aspect of the plan is contingent on further funding being secured.

Background And Context

The University announced in November 2024 that it was facing a financial crisis with an anticipated £30 million deficit, brought about by factors including a severe drop in international student recruitment, ongoing structural underfunding of higher education, cost increases, inflationary pressures and a range of other detrimental changes, including an increase in our National Insurance contribution.

This was compounded by internal factors including but not limited to;

• A longstanding structural imbalance with the scale and intensity of the University’s research profile being significantly greater that can be sustained from the scale of teaching and commercial activity delivered

• Inadequate financial discipline and control

• Poor capital planning and investment decisions

• Weak compliance in financial control policies and lack of accountability

The updated forecast, after taking actions to reduce operational spend and make immediate savings, is for a £35 million deficit for this year. There is a £63 million baseline recurrent structural deficit, requiring a larger improvement in the overall operating position to deliver surplus so that we can repay loans and rebuild a strong cash base.