New Peterborough university: fewer students, curriculum changes, long delay for independence but crucial for coronavirus recovery

Indeed, just last year it was promised that the long-awaited ambition would see the first students pouring in from 2022 and the new higher education facility becoming fully independent by 2025.

So there was some surprise when last month it was announced that what had been earmarked as the University of Peterborough was now going to become ARU Peterborough with the curriculum delivered by Anglia Ruskin University which already has a campus in the city.

What can now also be revealed is that the technical university based around the Embankment will not become fully independent until at least 2032, with a final decision only made following a review in 2028.

The information is contained in the Full Business Case (FBC) for the project which has been released into the public domain and highlights a number of other concerns and potential benefits of the project, including several related to Covid-19.

Among the key findings are:

. Students attending the university will register with Anglia Ruskin and receive a degree from it until at least 2030 as the centre will not have its own degree awarding powers before then

. A review will be held in 2028 to decide whether the university should become independent of ARU, with the expectation that it becomes fully independent in 2032 - seven years later than originally planned

. The anticipated number of students is lower than originally expected, reaching just over 5,000 by 2028 compared to the original target of 12.500 by the same date

. The university will lead the recovery from the coronavirus locally

. The expected shortfall in students would reduce the economic benefits of the new campus from just over £1.1 billion to just over £400 million

. Tuition fees will average £9,000

. The proposed curriculum “deviates significantly” from what was originally anticipated, with a much higher percentage of students on campus

. The university is only expected to make a tiny profit each year, despite having a very low budget for maintenance works

. Covid-19 provides a number of risks and opportunities, both in terms of student numbers and encouraging people locally to sign up

. The university will only open on time in 2022 if there are no further delays in the current process

. Ambitious plans are in place to team up with an ‘Innovation Partner’ to significantly boost business growth in the region

. The university will be crucial in fuelling the coronavirus recovery locally, with a series of workshops having already taken place on how to respond to the pandemic

The decision to delay the university becoming independent and having full degree awarding powers was made last year, around the same time the Cambridgeshire and Peterborough Combined Authority - the mayoral body overseeing the project - decided to dispense of previous academic provider University Centre Peterborough and find a new partner.

This was despite UCP being on the verge of applying for degree awarding powers itself and having created its own board to oversee the project.

The Peterborough Telegraph can reveal that nearly £1.4 million was awarded to UCP by the Cambridgeshire and Peterborough Combined Authority - the county’s mayoral body - before it replaced it with Anglia Ruskin.

UCP was removed after behind the scene disputes between stakeholders, although political leaders later insisted that all problems had been resolved.

It was announced this week that the centre has become part of the Inspire Education Group alongside Peterborough Regional College and Stamford College.

Professor Sir Les Ebdon, chair of the council of UCP, said: “We wish ARU Peterborough well but we want to stress that UCP will be continuing. We are recruiting students this August and we have a record number of applications. We will have over 800 students in September and plan to have over 1,000 in the next couple of years. 

“We will be a significant higher education presence in Peterborough - student focused, focused on our strengths like computing and business and seeking to work in a complimentary way with ARU.

“I think they are brave in these uncertain and difficult times for higher education, but there’s clearly a need for a significant increase in higher education provision in Peterborough, although I wouldn’t want it to be at the expense of further education in the region. 

“We shouldn’t impoverish further education to progress higher education.”

When UCP was removed as the academic partner for the university a tender process opened up to find a replacement.

The FBC indicates that three prospective bidders submitted expressions of interest, with ARU proving to be the only one which was “able to successfully complete all stages of the process and satisfy all the requirements of the tender”.

Despite this, risks remain. These include, according to the report, whether:

. Higher than anticipated levels of growth in student numbers will be able to be accommodated

. The form of education provision will reach under-represented and local groups of students and meet the needs of the region’s businesses

. The “marginal surplus” generated each year will be “sufficient to generate a sustainable, independent university in the long term”.

The combined authority believes the changes for higher education as a result of the coronavirus pandemic - which could result in a drop in students - means that the new university will be more vulnerable than had previously been forecast, which is why it is delaying its move towards independence and partnering with a larger and more established academic provider.

Will the new Peterborough university be at risk financially?

There is a current funding shortfall for the university which is anticipated to be £5.4 million and will be covered by a loan by Anglia Ruskin (capped at £6.5 million).

The university is expected to make a small surplus each year, resulting in a total profit of £311,150 by the end of 2030/31. However, it is acknowledged that the operating model is “vulnerable to almost any level of reduction in income” and will not be enough to fund the university’s future growth.

The key to making sure the university turns a profit is ensuring enough students sign up - with tuition fees expected to be £9,000 - while controlling costs.

It was initially envisaged that 15 to 20 per cent of students would be taught on campus, but ARU’s model is for that figure to be 30 to 46 per cent, although the Covid-19 pandemic could reduce that figure.

To mitigate against any potential shortfall, the full business case says there is “scope in the model for greater efficiencies in operational expenditure” and that staffing costs could be reduced.

The report highlights a number of other potential problems, noting that “the financial model is very sensitive to cost inflation” such as an increase in staff pay.

For instance, only one per cent of income has been set aside for asset maintenance, far less than the five per cent which is “more typical for higher education”.

Increasing the budget for maintenance would potentially leave the need for further funding, while a failure to do so could lead to “deterioration” of the facilities.

Another factor is that ARU is being leased the university on a 10 year rent free deal, but this will be up for review at the end of the period.

The report states that rent payments after this period “could result in a deficit”.

But on a more positive note, the report indicates that during the first decade there is contingency provision of around £1 million a year which “will be a critical tool for management of financial risk in the operation of the new university”.

It adds: “If the contingency is not required, it represents a potential opportunity to provide betterment to the financial model.”

The combined authority is also confident that the financial performance will be better than predicted in the report.

The full business case gives a mixed picture on the finances and notes that “the sensitivity of the model to fluctuations in revenues is very high”. It makes it clear that careful management will be needed with operating costs very likely to change from what is currently forecast.

It also reveals that there will be 26 students per member of staff, with full time academic staff paid on average £65,000 a year and professional services staff £35,000.

Funding of £12.5 million for the project has been secured from Local Growth Fund (government) investment in return for equity. The repayment strategy for this funding is through the potential sale of the LGF’s shares in the building to a commercial or institutional property investor.

Coronavirus risks and opportunities for new Peterborough university

The impact of Covid-19 could be wide-reaching for the new university.

The full business case highlights a number of potential risks and opportunities as a result of the pandemic, while highlighting that ARU is “less exposed” than most higher education establishments for reasons including a lower reliance on international students and low building costs.

A series of workshops to ascertain the impacts of Covid-19 on the viability of the project, including student numbers, have already been carried out, and this will help with the development of the curriculum.

Measures to ensure social distancing on campus are also being implemented.

With Peterborough seen as a higher education cold spot, and people looking to re-train due to the pandemic, potentially after being made redundant, it is believed the technical university provides a real opportunity.

This is particularly through degree apprenticeships which ARU already provides and which are seen as appealing to students, many of whom may now be more likely to study locally.

It is believed that student numbers “may well fluctuate” due to the pandemic, but this could actually result in a rise in numbers with many looking to up-skill.

The full business case states that the courses and qualifications offered will “align to the sectors and industries required for recovery”.

It says that the university was already planning to use online learning and new technologies such as augmented reality, so was “ahead of the curve pre Covid-19 and post Covid-19”.

Peterborough and Fenland are expected to be among the worst affected places in the UK due to the crisis, “partly due to education deprivation and partly due to the region’s low-tech industrial base,” which means that, according to the report, “the new University of Peterborough is critical to the economic recovery of the region”.