You may have seen recent reports in the media regarding the surpluses made on student accommodation and I thought it would be helpful to explain how student accommodation is financed within the University.
We pride ourselves on providing good quality accommodation. In fact, in the 2017 Best Student Accommodation Winners, compiled by StudentCrowd on the basis of 10,834 student responses from across the UK, two of the top 50 student halls are here at the University of Bath. The survey took into account a number of factors including value for money, hall management, cleaning and social spaces.
We are committed to maintaining standards in our student residences.
Without the surplus there would be less cash to pay for maintaining the accommodation and the standard of rooms would decline.
Any surplus provides the cash to pay for refurbishments and payments due on the loans for completed buildings – nothing else.
This is what we mean when we say that the Accommodation department’s account is ring-fenced.
New buildings are funded by loans from financial companies. The University is able to borrow at a better rate than most private landlords and our services benefit because of this. As well as paying the interest on the loan, the loan has to be repaid too.
The cash in and out does not balance every year but over a period of a few years it will even out. Last year there were a number of major refurbishments so the rental income did not cover all the costs. This meant the rest of the University supported the Accommodation department’s cash needs by £2.3m. The previous year the University supported Accommodation by £0.2m. In the longer term we forecast that this will even out, but it will fluctuate from year to year.
Over the summer the University lets rooms for use by non-students. This includes conferences, summer courses, holidaymakers and others. All of this income is retained by Accommodation to help maintain the quality of the rooms.
The University aims to provide rooms to meet a range of budgets, although it is fair to say that demand is greater for the more expensive rooms. We monitor the prices of other local universities and private providers and are confident that our price and service is very competitive.
Many other universities use their student accommodation to make money to pay for other parts of their university.
At Bath we have not done that.
Instead we have chosen to use the cash received from rent to provide and maintain good quality accommodation that we hope students enjoy staying in.