Prestigious Scottish university cuts deficit to £8.5m after 'swift and decisive action'
‘No plans’ for further voluntary severance scheme at ancient Scottish institution
The principal of Aberdeen University has hailed “significant” progress in stabilising the finances of the ancient institution, cutting its underlying deficit to £8.5 million in 2023/24.
Professor George Boyne said the university had taken “swift and decisive action to secure a sustainable financial position”, despite rising costs and lower public funding.
The £8.5m underlying deficit represented a reduction on the £12.5m loss forecast earlier in the year.
The university’s annual report highlighted an improvement in its overall position since last year, when The Scotsman revealed its accounts for 2022/23 had warned there were uncertainties that “may cast significant doubt over the ability of the university and group to continue as a going concern”.
Aberdeen University bosses had said one of their “key priorities” had been to remove this auditing phrase from its next accounts for 2023/24, which it has done.
A recovery plan was launched at the end of 2023, including a voluntary severance scheme. The latest accounts show savings of £19m were achieved in 2023/24, with £13m coming from staff costs and £6m from operations.
To meet its £6.7m deficit target for 2024/25, a total of £18.5m of savings have been identified to date.
As previously reported by The Scotsman, £10m had been set aside in 2024/25 to fund a fresh voluntary severance scheme. But the new report said “as things currently stand, there are no plans for this further ER/VS scheme”.
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The accounts also show Prof Boyne’s salary increased from £281,000 to £292,000 in the year, with his package including living allowance and pension contributions up from £313,000 to £320,000.
In the report, the principal said: “Faced with rising costs, lower public funding, and a reduction in our international on campus student recruitment, set against an external environment fraught with political, economic, and social tensions, we took swift and decisive action to secure a sustainable financial position.”
Prof Boyne added: “Our progress has been significant and we reduced an initial projected deficit of £12.5m to £8.5m for 2023/24 and made in-year savings for 2024/25 of £18.5m.”
Several other Scottish universities have reported underlying deficits in their accounts for 2023/24.
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