When universities merge, one might imagine that deciding on the theme of the annual Christmas card would not come particularly high on the list of priorities. But at Swansea Metropolitan University and the University of Wales, Trinity Saint David, which joined forces last October, it proved to be an early test of how the institutions would resolve their differences.
“Trinity by background is a church college,” explains David Warner, former vice-chancellor of Swansea Met and now the senior provost of the merged institution. Swansea Met, in contrast, “has always been a secular institution”.
In the end, the new university - known as University of Wales Trinity Saint David - plumped for a snow-covered forest scene. Although the image is not explicitly religious, Warner believes a compromise was reached: the picture could “easily be said to have a religious flavour in the [sense of the] holistic view of God as the creator of nature”.
That was not the end of the Christmas card conundrum. Swansea Met is part of “English-speaking Wales”, whereas Trinity Saint David, particularly the Carmarthen campus, “is a strongly Welsh-speaking campus”, Warner says. So the final design featured the message “Season’s Greetings” in both Welsh and English - but, he points out, “with Welsh on top”.
All this may sound of little consequence, but the anecdote “isn’t trivial”, Warner insists, because it illustrates just how complex it is to take account of the sensitivities involved when joining two universities.
In Wales, mergers are moving ahead amid concerted pressure from the Cardiff government, which fears that the country’s smaller universities lack the critical mass to weather coming financial storms. The University of Glamorgan and the University of Wales, Newport are also on course to merge this autumn. (The Welsh government has backed off from forcing Cardiff Metropolitan University to merge with them after objections from the institution.)
And in England, experts predict that some institutions will look to mergers as a way to save money and share risk in an age of austerity and uncertain student numbers. With England’s higher education system confronting a radically different funding regime, others believe mergers could save universities on the brink of financial collapse. Some institutions may decide to merge for more positive reasons: stronger universities might look to combine their strength with other research-intensive UK universities, or even with leading institutions overseas, to boost their research prowess and to propel themselves further up the global league tables.
But many in the sector are sceptical of the benefits, and mergers undoubtedly involve a major upheaval. So when should such partnerships be attempted - and when should they not? What are the greatest challenges, and what makes for a successful merger?
With budgets under pressure, a pressing concern is whether mergers can help universities to reduce their costs. It has long been argued that in bringing two institutions together, IT, finance, human resources and other central services can be combined, thereby freeing up money for teaching and research. As far back as 1997, Frank Gould, vice-chancellor of the University of East London at the time, made the case in 成人VR视频 for the potential to gain “substantial savings” through mergers. It was a solution “staring us in the face” but one “whose name no one dares speak”, he claimed.
This solution makes sense in theory but is difficult to achieve in reality, says Warner, who is an expert on mergers and author of a number of books on higher education management. There are “never major savings” to be made from merging higher education institutions, he says, adding that there are only two ways to save serious cash in universities: “sacking staff and closing campuses”. Neither is on the agenda at University of Wales Trinity Saint David, he stresses.
In March 2012, the 成人VR视频 Funding Council for England released a major report that examined previous mergers in the sector. Collaborations, Alliances and Mergers in 成人VR视频: Consultation on Lessons Learned and Guidance for Institutions found that institutions tend to underestimate the costs of such a move. In respect of post-merger administrative costs, it concludes, there was “no consistent pattern” up or down. Staff costs usually rise initially as pay is harmonised between the two partners and new posts are created.
Still, the Swansea Met-Trinity Saint David merger will achieve savings in the salaries of senior managers, says Warner. He predicts that the overall initial cost of the merger will be recouped within 18 months from subsequent savings, although another senior source in the new institution thinks it will take much longer - about six to seven years.
In any case, looking to save money should never be the primary impetus for a merger, says David James, a policy consultant for Hefce who worked on the funding council’s 2012 report. A case for merger should rest on improving “teaching, research and knowledge transfer”, the central missions of a university, rather than a “narrow” focus on cash, he says.
But while a merger may not be a way to cut costs - certainly not in the short term - it is often said that it can provide a lifeline for an institution that finds itself teetering on the brink of financial ruin. Indeed, in such a situation, “a partnership with another institution becomes the only game in town”, says Roger Brown, professor of higher education policy at Liverpool Hope University.
In the clearest example of the current financial volatility facing the sector, London Metropolitan University faces significant funding difficulties after a UK Border Agency decision last August to suspend its “highly trusted sponsor” status, preventing it from recruiting non-European Union students. London Met is challenging this decision in the courts.
The sector also faces an unpredictable market in domestic students, so the pace of mergers “will almost certainly be accelerated”, Brown predicts.
Although Trinity Saint David was not in short-term financial danger at the time of the merger, its vice-chancellor, Medwin Hughes - who is now head of the merged institution - acknowledges that it was a “small university” and that it would have been “challenging” to keep it viable and independent in the medium term. Leighton Andrews, Wales’ education minister, has been keen to merge Wales’ universities because he believes that bigger universities are more resilient.
Trinity Saint David recorded a wafer-thin 1 per cent budget surplus in 2010-11, taking into account exceptional costs of almost ?1.5 million relating to the restructuring of departments in Lampeter and Carmarthen. Swansea Met, in contrast, recorded a surplus of 17.6 per cent in 2010-11, and this will rise to about 21 per cent for 2011-12, Warner says. As he sees it, Swansea Met has offered financial stability to Trinity Saint David, which suffered a “failure to recruit” this academic year.
But why would or should a cash-rich university bail out a failing neighbour by, in effect, taking it over? This is a key question for the government in England, where ministers in the coalition say they want to encourage competition in the higher education sector. Brown believes this question “should be causing Alan Langlands [the chief executive of Hefce] and David Willetts [the universities minister] to have sleepless nights”.
Glynne Stanfield, a partner in the education group of the law firm Eversheds, who worked on the 2004 merger of Victoria University of Manchester and the University of Manchester Institute of Science and Technology (see below), thinks that the coalition government in Westminster has a different attitude towards mergers than had New Labour.
“Up until now, [mergers have] been government-driven - a tap on the shoulder,” he says. Whether the current government would intervene in this way, and whether it would want to protect a failing university by encouraging a merger is far less clear, he suggests. In the latter situation, the government clearly “won’t want students out on the streets”, but this does not mean that universities should rely on the Treasury to come up with a large dowry to sweeten a shotgun wedding.
Vince Cable, the business secretary, said in a speech in 2010 that “we already have a lot of universities that are effectively broke…Various arrangements have been cobbled together to keep them going, and we can’t continue to do that.” It is understood that his department’s key priority in the event of a bankruptcy would be students - but this leaves open the possibility that students could simply be transferred to other institutions, leaving the financially failing institution to collapse.
Vice-chancellors looking to merge could potentially apply to Hefce’s new ?45 million annual Catalyst Fund, which can be used to “manage transition” or to “protect students in the event of significant institutional difficulties”, according to its remit. But this route is untested. The fund is so new, James explains, (it was launched in August last year) that no cash for mergers has yet been requested. “We’re in slightly new territory here,” he cautions.
Moreover, the amount of money in the pot seems relatively small in the context of the sums Hefce has previously deployed to assist mergers - for example, it spent ?20 million supporting the 2004 Manchester union. In future, says James, “any funding we have is likely to be relatively small-scale”.
But there may be other reasons for universities to join forces. Eversheds’ Stanfield is an advocate of mergers that link up two already strong institutions. It makes sense, runs the argument, to combine research power, and doing so can also help to propel institutions up some global league tables, which typically take into account the number of publications, citations and awards a university wins. This type of merger is “where the real investment should be”, he believes.
According to the Shanghai Jiao Tong Academic Ranking of World Universities, (the only global league table to separately rank the two institutions before they merged), in 2004, the University of Manchester was in 78th place, while Umist was in the 202-301 band. When the united University of Manchester was ranked for the first time in 2005, it rose to 53rd place, and it has been placed about 40th in the world ever since.
The University of Liverpool and Lancaster University appear to have been tempted by such a scenario. In 2011, they circulated a consultative paper among staff that set out the case for a “federal structure”, albeit without explicitly using the word “merger”. A single institution, which the paper called “LLU”, would rank seventh in the UK for research power, it noted. But in May 2012 it was reported that the pair had abandoned the “federal model” proposal because it would not be possible to achieve “transformational benefits at this time”.
Stanfield urges vice-chancellors to broaden their horizons, too, and to look for potential partners overseas: “If I were the vice-chancellor of a Russell Group university, I might be looking outside Britain.” He expects to see a research-intensive UK university merge with an equivalent institution overseas - perhaps a member of the Ivy League - in the next five years.
He points to major research tie-ups, such as a pact in 2000 between the University of Cambridge and the Massachusetts Institute of Technology, the Cambridge-MIT Exchange. Last year the University of Warwick and Australia’s Monash University formed a partnership aimed at pushing them “well into the first 50 institutions” in the world. Such partnerships can be small steps towards a future merger, Stanfield suggests.
For universities that decide to take the plunge, one of the first obstacles is likely to be a vice-chancellor’s ego. Stanfield says that over the past five years he has been involved in four merger discussions that broke down when the institutions failed to reach an agreement about who would get the top job. “In one case (the merger was called off) at quite a late stage” for this reason, he reveals.
Warner agrees that it is important to “get the top posts sorted” early on. In the case of the Swansea Met merger, “this happened extremely easily by me volunteering to step down [after 14 years as vice-chancellor] in the belief that this merger was in the best interest of Swansea Metropolitan University”.
Three conditions need to be met before a vice-chancellor will graciously agree to step aside, he suggests. “There has to be a financial arrangement so there isn’t a massive financial detriment [to the individuals involved]. Second, there must be something that convinces the individual that this is best for the institution they have led.” And third, the arrangement must “save face” for the departing leader.
In 2005, the Surrey Institute of Art and Design University College and the Kent Institute of Art and Design came together to form the University College for the Creative Arts. In 2008, the merged institution gained full university status, which had been a key motivation for the move. For 18 months after the merger, there was a transitional arrangement, with the leaders of the two institutes splitting financial and academic control between them.
“Power sharing is very difficult. You have to get through it as best you can,” says Elaine Thomas, the head of the Surrey Institute before the merger, who was responsible for academic direction during the transition. As part of the agreement, she became vice-chancellor at the end of the transition. “I’m reasonably egotistical…I couldn’t wait to be the proper boss,” laughs Thomas, who is now retired.
The new institution was described as a “merger of equals”, and the composition of the new governing body was split equally between members of the two institutes’ governing bodies. This arrangement may save face, but it is not recommended by the Hefce report. A power-sharing transition period “can lead to ambiguity about roles and also result in defensive behaviour rather than serving the needs of the new institution”, it warns.
New appointments should be based on merit rather than merely seeking to achieve balance between the partners, according to the report. As for new governing boards, “creating a new institution requires the appointment of at least some new people”, it advises.
The Hefce report also warns of another hurdle: a culture clash between partners. “Culture will affect the success or otherwise of attempts to achieve organisational change,” it says. “Institutions will need to focus on communication and consultation, and on the social integration of staff and students.”
Thomas puts it more bluntly: if cultures between campuses are different, “you have got a real problem in trying to make changes”. And Warner admits that in the Welsh merger “both sides are terrified” that the culture of one institution will end up being dominated by the culture of the other. “It’s not about one (culture) being subsumed by the other,” says Hughes, University of Wales Trinity Saint David’s vice-chancellor. “Both sides have to leave their baggage outside the door. They have to create a new ‘we’.”
But winning hearts and minds can be difficult, and merger proposals frequently meet with strong opposition from staff and students. The rationale for such a move is often questioned, and there can be concerns that a merged institution will lose its distinctive identity.
In one recent example, academics campaigned against plans to merge the School of Pharmacy with University College London. Opponents claimed that the business case had not been made to staff and that the only dedicated pharmacy school in the UK should remain independent.
“Specialist institutions like the School of Pharmacy create our diverse economy of higher education. We have seen this landscape flattened out as several have merged over recent years. We do not want to lose another,” Barry Jones, a University and College Union London official, said at the time.
When the merger was confirmed in 2011, Anthony Smith, then dean of the school, said the move was taking place “in an era when higher education is facing the most severe challenges we have ever known in the UK”.
Finally, there is the small matter of what to call the new institution. While the official name of the new Welsh university is University of Wales Trinity Saint David, Swansea Met will keep its logo and will be marketed as “Swansea Metropolitan University of Wales Trinity Saint David”, the longest university name in the UK. “Of course it’s confusing … but it isn’t very confusing,” Warner argues. “We are going to be Swansea Met because that is a name we have worked really hard to develop in the marketplace, and it has worked,” he says.
There are no easy options when it comes to names, warns James. A merged institution can adopt one partner’s brand and name, combine the two or invent an entirely new one. This last option “may be higher risk, and we encourage institutions to think through the implications carefully”.
The consequences can be serious: the creation of the University College for the Creative Arts was followed by a two-year drop in applications as baffled students turned elsewhere. “When you make a [name] change like that, it doesn’t matter how much effort you put in: prepare for a dip [in applications],” warns Thomas.
Even if the case for a merger appears to be overwhelmingly strong, James strongly advises universities to listen to opposing viewpoints and to “genuinely” review all the options.
According to Brown, scepticism about mergers “has to be the order of the day”. But unless struggling universities are allowed to fail, mergers may become more common. What is unclear is where support and financial backing for mergers will come from in future. If a merger appears to be the only way out for a university in financial trouble, the urgent question faced by the sector, the funding council and the government, says Brown, will be: “Who will help it happen?”
Joint ventures: notable mergers in the UK
Victoria University of Manchester and University of Manchester Institute of Science and Technology, 2004
The University of Manchester has occupied a spot in the top 50 of global league tables ever since the merger of its two constituent parts in 2004.
It is praised as an example of a successful merger in a 2012 report for the 成人VR视频 Funding Council for England, Collaborations, Alliances and Mergers in 成人VR视频: Consultation on Lessons Learned and Guidance for Institutions.
At the time of the merger, both the vice-chancellors and the governing boards of the previous institutions stood down and new appointments were made.
The institutions were dissolved at the same time and a new chartered university was set up. The two predecessor institutions had long shared services, including a School of Materials.
Much of the logic of the tie-up was about boosting research power. But there were criticisms that the resulting institution - which had more students in 2010-11 than any other UK university - neglected teaching and that staff-to-student ratios had failed to keep pace, making teaching too impersonal. The university instituted a review of its teaching in 2008.
In 2009, 77 per cent of Manchester students responding to the National Student Survey said they were satisfied with their course, a below-average score, but by 2012 this figure had climbed to 83 per cent.
In January 2012, the current vice-chancellor, Dame Nancy Rothwell, announced a cut in student numbers of 1,000 and the addition of 100 extra academics. “The university recognises that there was more focus on research than on the student experience in the early years, but this has now been rebalanced,” the Hefce report says.
The Manchester merger was supported with ?65 million in public funding, including ?20 million from Hefce. Other funding came from the Office of Science and Technology and the North West Development Agency.
London Guildhall University and the University of North London, 2002
These two universities joined forces because their leadership wanted to expand and felt that the institutions were under-capitalised.
Both universities shared a widening-access mission and had a similar student demographic.
The merger received ?6.5 million from Hefce, a tenth of the public funding that had been put into the Manchester tie-up.
The merger was presented as a partnership of equals, so both vice-chancellors were kept on. Sir Roderick Floud, provost of Guildhall, became vice-chancellor, while Brian Roper, vice-chancellor of North London, became chief executive. Roper became vice-chancellor in 2004 and Sir Roderick became president, a post he held until 2006.
In 2008 a crisis engulfed the university when it emerged that the institution owed the funding council tens of millions of pounds after inaccurately reporting student numbers.
In the same year, consultants PricewaterhouseCoopers advised that a further merger with another institution would be a “sensible solution” once a position of financial stability had been achieved.
Roper resigned in March 2009, followed later that year by members of the board of governors. At the time some commentators criticised the 2002 merger, arguing that it was one source of some of the problems the institution went on to experience.
Thames Valley University (now the University of West London) and Reading College, 2004
Hefce’s report is unambiguously scathing about this tie-up, which the university has since admitted was “an idea without a rationale”.
The acquisition of Reading by Thames Valley was supposed to create a regional institution where students would flow easily from further to higher education, but it was dogged by problems.
On the financial side, the business plan was based on growth in further and higher education students, but it transpired that total numbers substantially decreased. Post merger, financial performance worsened, owing to “unrealised income growth, pay harmonisation and the costs of operating on several sites”, according to Hefce.
Just before the merger, Reading failed an Ofsted inspection, but the management ploughed on. In addition, “the two institutions never properly integrated systems and cultures. The difficulty of these tasks was underestimated,” the report says.
In 2010, Thames Valley decided to part ways with Reading in order to focus on its “core business”.
? Sources for case studies: Collaborations, Alliances and Mergers in 成人VR视频: Consultation on Lessons Learned and Guidance for Institutions, Hefce; research by 成人VR视频.
