Getting and keeping UT financially sound from a clear vision for the future, with our strong values as a starting point, is currently a major priority. The accumulation of challenges with financial consequences - stagnating growth in student numbers, the internationalisation debate, government budget cuts and rising costs - necessitate a firm adjustment of our course. To this end, we have already taken several measures and will also have to take further actions in the coming period to continue making a societal impact from a financially healthy organisation. We would like to share an update on the latest state of affairs with you. We also discussed these with the University Council this morning.
In this update, we address the following themes:
- Our vision for the future
- The progress of acute measures this year
- First insights into the 2025 budget
- Being in control
- Joint task: we are in it together
Our vision for the future
Addressing UT's financial challenges requires a clear vision of where we want to go: the dot on the horizon. Earlier, we concluded that the Shaping2030 mission statement needed an update. We adopted this earlier this year after a broad consultation. Over the past few months, we also concluded that we needed more focus on other points. We are pleased with the first yield from the Strategic Board, in which the Executive Board, deans and scientific directors of the institutes are represented. They came up with a position paper containing their thoughts and ideas, which we will translate into concrete steps in the coming period. This paper offers good ingredients and perspective for where we want to go as UT and what we want to preserve.
Reinventing the UT clearly sets out where our strengths lie, the challenges ahead and what that means for education, research and valorisation activities of the future.
Although the document does not have the formal status of a UT vision document, it does have an important role in developments in the coming period. The content will be used in the writing of the institutional plan 2025-2030 that we will start working on later this year. But also in all the more urgent choices we (have to) make, we will use the reflections in the position paper as guiding principles.
The University Council has indicated that we need to articulate our strengths and uniqueness even more clearly together. It is great that the UC members are happy to think along in this from their commitment and expertise.
The progress of acute measures this year
Both last year and this year, we instituted acute measures to help reduce our budget deficit. These include putting a stop to external hiring and critically assessing all vacancies, as well as limiting the use of student jobs.
The most recent management report - covering the period from 1 January to 1 September - shows that we are making financial savings. However, the impact is smaller than intended: the forecast at the moment is that we will realise 4 million of the targeted 12 million euros in savings by 2024.
As a result, the expected operating result for 2024 is €13.4 million negative. While this is better than in 2023, it is still lower than budgeted: we had budgeted a negative result of €7.5 million for 2024. We do see a culture change within the organisation: employees everywhere are more critical of the need for expenditure. This is vital to realise further savings in the coming months.
First insights into the 2025 budget
In recent months, we have seen service departments and faculties working on their budgets for 2025. In order to maintain UT's financial position, it is necessary to limit the deficit next year to no more than one per cent negative. The directorates of departments and faculty boards started working on that.
The process showed how difficult it is for the units to find additional savings measures without making major - and sometimes difficult and painful - choices. For that, the building blocks - more on this later in this update - will provide important input. Think, for example, of redesigning education more efficiently and increasing income from second and third flow of funds.
Some Building Blocks will not have a financial impact overnight because they are extensive and require major adjustments. Developing and implementing these further requires a carefully considered approach that should lead to structurally lower costs.
Most units conclude that it is possible to stay within the financial frameworks. During the budget process, the TNW faculty came to the conclusion that, after the losses of the past few years, meeting the 2025 financial frameworks will not be possible and a reorganisation will be necessary. The faculty board informed their employees about this last month. In consultation with the participation body, the faculty board is looking at what is needed for financially healthy operations.
Being in control
To ensure that we are successful in addressing the financial issue in the coming period, it is very important to be in control: only then can we make the transformation that is necessary and at the same time ensure that we maintain the quality of our education, research and valorisation. This requires, for example, realism in budgeting and disciplined follow up.
Earlier, we formulated twenty building blocks with both strategic and operational tasks. Several months on, we see that a number of building blocks have been realised or have been incorporated into the regular organisation. We have now clustered the remaining building blocks into logical clusters to achieve maximum synergy. You can read more about that clustering in an earlier news item on the service portal.
Last month, Karin Bax started as programme manager organisation change. We are pleased to have her experience on board. In the coming period, she will play an important connecting role and, together with a team of UT employees, coordinate, guide and, where possible, accelerate the changes. In the programme team, the various areas of expertise are well represented and a sounding board group will also be set up with representatives from the various sections within the organisation.
We are confident that we can take the right steps forward with this organisation.
Joint task: we are in it together
As the Executive Board, we realise how impactful the situation is for our staff and also for our students. We also hear this in the conversations that we as members of the Executive Board have had with many employees in various parts of the organisation over the past period. We will continue to have those conversations in the coming period as well. At the same time, there is great commitment and willingness to think and participate. This was also evident in the conversation with the University Council this morning.
Change brings uncertainty, and we try to answer questions as best we can. Sometimes, we only have immediate answers to some questions. Although we have a dot on the horizon, the path towards it is not always a paved and predictable one.
We keep everyone as informed as possible, for example on the service portal, and know that faculty boards and department directors to do the same as well. There is also frequent alignment with the Student Union.
If you do have questions or if you are worried, please talk about it with your supervisor. Or perhaps you have ideas that may be helpful for the university. Also feel free to approach us, for instance, at one of the meetings in the various units that we will be attending in the coming period.
All in all, we have a big task ahead of us. But… we are in it together: we are confident that with our innovative strength and doer's mentality, we can accomplish this task together.
Vinod Subramaniam, Tom Veldkamp, Machteld Roos
Executive Board
