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My name is bond, university bond…

Several universities have borrowed significant amounts of money from private and/or public investors. UK universities have issued £4.4bn in bonds since the beginning of 2013. This figure is scary given the total yearly HE sector income of about £30bn. This university has a £300M bond issued in 2017.

When we borrow money for a house mortgage, we repay interest and capital, so that the whole loan is eventually repaid. Or we can pay interest only, but this means there is still a debt to be cleared at the end of the term. The interest-only model is used for the university bond. The university will pay 2.25% interest every year, some £6.7M, and are supposed to pay the full £300M back in 40 years. (Oxford, has a bond for 100 years). The bond is akin to issuing shares to a group of shareholders who will have a steady regular income but it turns our university into a for-profit organization bound to make a yearly surplus to satisfy these investors.

This is the climax of marketization. Universities are burdened with financial obligation and under the surveillance of rating agencies. In recent weeks your UCU officers have been told that we are not allowed to know student numbers because this is ‘price sensitive’ information and we must not alarm the investors. How did we end up in an education institution that cannot tell us how many students we have?

When the bond comes to term those who made the financial decisions will be long gone, yet staff at the university will have paid the price many times over. How did we end up here? Such endeavours would have been unthinkable twenty years ago. The game changer of course was the reduction in public investment in Higher Education. Alongside the introduction of student fees and loans these kinds of bond arrangements shift public investment into private debt. A great way to make the national budget look better but not necessarily the best way to support education. The bond is a millstone around our necks: it demands that we – the staff – generate surplus. This is clear in the 10 year plan [password required], the source of pressures to reduce staff pay, pensions and announce redundancies, which UCU are currently fighting.

In the appointment of our next Vice-Chancellor, it is essential that we, as an academic community and as UCU, seek a Vice-Chancellor who will stand up with our community against the marketization of education. We need a Vice-Chancellor who will work towards more democracy and listen to frontline staff and students so that we are integral to the university strategy rather than mere recipients. There is still time to sign the petition about the appointment of the next VC and to make sure your voice is heard.

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