Members:

Sir Bryan Carsberg (Chair); Professor C J Backhouse; Mr J B C Blood; Dr R H Boissier;
Dr T G M Brooks; Dr S Campbell (ab); Dr M J Catton; Ms V Dhupa; Dr M Gilbert; Professor C Hanson; Mr P Harrisson (ab); Mr P J K Haslehurst; Dr T Higgins;
Ms N Honey; Mrs J E Hull; Ms H Jenkinson; Professor T J Kavanagh; Mr E O Maxwell;
Professor R McCaffer; Mr M Moghal (ab); Mr D Morris; Mr W M Moss;
Dr P N Murgatroyd; Dr L R Mustoe; Mr J Mutton; Mrs W M Pilkington; Sir Denis Rooke; Dr J F Rowland; Ven I Stanes; Mrs J A M Strong (ab); Mrs M C Tomlinson;
Mr D R F Walker; Professor D J Wallace; Mr J B White; Mr C S Woodruff

Professor J L Alty; Professor N A Halliwell; Professor I C Morison; Mr H M Pearson; Professor P H Roberts; Professor H Thomason; Mr J M Town; Miss M T Whyte
Mrs S J Samples for items relating to minute 01/130 - 01/134

Dr S Campbell, Mr P Harrisson, Mr M Moghal

It was RESOLVED to confirm the Minutes of the 280th Meeting of the Council held on 26 October 2001 [COUN01-M7] subject to the following amendment to 01/107.1:

Replace paragraph 4 with "The Chair of Estates Management Committee (EMC) reported that EMC had considered and agreed the conclusions of the Working Group on Combined Heat and Power (CHP) that a CHP scheme would be considered when Government funding was available. Grant money of approximately £60M would be available for such schemes. The University would be applying in November. The shortfall in power of about 1000KVA would be made up by an additional 11KV cable from the electricity supplier at a cost of approximately £600K. Meanwhile, the EMC would continue to look at the economics of CHP from other universities who had already or were about to install CHP such as Birmingham and Warwick respectively."

The item relating to Minute 01/139 was unstarred.

 01/132 Matters arising from the Minutes

It was NOTED that remaining changes to Charter and Statutes, as agreed by the Council, had been approved by the Privy Council on 31 October 2001. These included all matters relating to Pro-Vice-Chancellors, Deputy Vice-Chancellor and Faculties.

Tabled Paper

The results of the RAE 2001 showed a significant improvement in Loughborough University's grade profile:

• Three Units of Assessment (UoAs), representing 16% of returned staff, moved up to grade 5*
• The percentage of staff returned at Grade 5 had increased
• There had been a drop in the number of staff returned at Grades 4 and 3a

However, there was some surprise at the overall improvement achieved by the sector in RAE terms and, at institutional level, the University had, at best, kept pace. At Unit of Assessment (UoA) level, whilst some areas had been successful, the results had been disappointing for others.

In broad terms the Funding Council had indicated that funding would be protected for 5* UoAs but detailed analysis of the financial implications of the RAE 2001 results at this stage would be premature, as it was not possible to predict the unit of resource. The best estimate was that the University would remain neutral overall in cash terms.

The PVC(R) reported that the national average was 55% of returned staff at Grade 5/5*. The breakdown for the University was:

• Engineering - well above the national average with 75% of returned staff at Grade 5/5*
• Social Science and Humanities - at about the national average with 53% of returned staff at Grade 5/5*
• Science - well below the national average with 13% of returned staff at Grade 5/5*

Each Faculty had delights and disappointments. Success stories included English and Drama who had moved from Grade 3a to Grade 5, Electronic and Electrical Engineering who had moved from Grade 4 to Grade 5 with no explicit investment to achieve this and LUSAD who had moved from Grade 2/3 to Grade 4. Whilst these results were encouraging, the University had a long way to go and, overall, had dropped 8 places to 39 in the Times Higher Education Supplement league table. Hard decisions would be needed regarding selective investment to improve the position for the next exercise. The PVC(R) advised Council that the University should be prepared to take risks in some areas and that a Development Fund would be needed for investment in the 2006 exercise. In support, a member commented that Development Funding in the last round had started late and that Council needed to recognise the importance of early and timely action.

The Faculty of Engineering had received formal announcement regarding an EPSRC research grant for Innovation Management and Construction worth £14.4M over the next five years. This was the largest award ever made by EPSRC.

The Vice-Chancellor congratulated Professor P J Taylor and Professor M H Smith on their recent election to fellowship of the Academy for Learned Societies in the Social Sciences.

The Vice-Chancellor congratulated Rod Thorpe and Rex Hazeldine on their admission to the UK Coaching Hall of Fame.

The England and Wales Cricket Board (ECB) and Sport England had confirmed that Loughborough University would be the permanent site of the new ECB National Academy.

Council congratulated Loughborough College on recent teaching quality assessment scores. The college had scored 21/24 in Business and Management and 22/24 in Sports Science. This was extremely creditable and placed the college well above average in the Further Education sector.

COUN01-P90 (and separate enclosures)

Council received the University Financial Statements for the year ended 31 July 2001 together with the University Financial Statistics for 2000/01.

In his introductory comments to the 2000/2001 Financial Statements, the Treasurer highlighted a number of issues. The University had achieved a surplus of just over £3M; the target set by Council. This had been aided by £1.1M from a repayment of VAT. Income overall had increased by £8.2M, the largest increase being research grant and contract income which had risen from £20.79M to £24.59M and contributed 21% to the total income against 19% the previous year. Council congratulated all staff who had contributed. Expenditure on staff costs had increased by 4.76%, 6.14% if restructuring costs were taken into account.

The Treasurer drew Council's attention to costs involved in settling a claim by a supplier to the former College of Art and Design. At the time of the merger it was understood that all liabilities had been resolved. Unfortunately, a long standing claim had since emerged and the total costs to the University, including the settlement to the plaintiff and both sides' legal costs, was in the region of £96K, a sum fully provided for in this years Accounts.

The Bursar then commented on the Balance Sheet, Cash Flow Statement and overall financial performance in relation to the Financial Strategy approved by Council. Whilst a period of heavy spending on capital items was in progress, and this was placing significant pressure on the University's cash reserves, the Balance Sheet remained in a satisfactory state judged by the norms of the higher education sector as a whole and the targets the University had itself set. Sufficient borrowing facilities were available to fund the capital programme.

A new accounting standard on pensions for 2002/03 meant that the University had to identify its liability associated with the Local Government Scheme, of which it had over 1000 members. The best estimate at this stage was that the underlying liability would be approximately £2.8M in 2002/03 though a more accurate estimate should be available in the following year, once the actuarial re-valuation currently being undertaken had been completed. The liability would appear on the University's balance sheet from 2002/03, but the impact on its banking covenants and the attitude of the Funding Council were unknown at present.

The Treasurer emphasised the importance of creating surplus to enable the University to maintain and improve its assets and to finance new initiatives.

Council APPROVED the adoption of the accounts.

COUN01-P91

Council received reports of the joint meeting of Audit Committee and Treasurer's Committee and the meeting of Treasurer's Committee held on 28 November 2001. The following amendment was noted - the final sentence under paragraph 7 of the report of Treasurer's Committee should read "The Committee agreed that a sum of £10M should be BORROWED on fixed rate terms over 10 years."

In the Committee's view, the University's Financial Strategy must be aligned with HEFCE strictures. The Committee had drawn up parameters and guidelines for both borrowing and investment:

1. servicing costs should not exceed 4% (imposed by Funding Council)
2. the budget should provide for a 3% surplus
3. the net current assets should not fall below 7% of income (relaxation on 10% previously adopted)
4. long and short-term creditors should not exceed 60% of the University's total assets

Some members commented that the University may be in danger of being too financially prudent and that adoption of the above parameters may discourage risk taking necessary to improve the institution's position, for example in research. The Treasurer responded that the guidelines were intended to offer a balance of flexibility and reassurance. If any of the parameters were likely to be breached as a result of investment or borrowing, a case would need to be made to Council for careful consideration.

On the recommendation of the Treasurer's Committee, Council APPROVED the Financial Strategy.

COUN01-P92

Council RESOLVED to increase the borrowing limit from Yorkshire Bank Plc to £40M in line with the paper appearing in the agenda.

COUN01-P93

The Bursar gave a progress report on the Capital Programme as summarised in the Agenda paper. Council's attention was drawn to the following new projects:

• Human Resources Computer System
• Teaching and IT Infrastructure Improvements and Disability Improvements

The following projects had made significant progress since the last meeting of Council:

• The England and Wales Cricket Board (ECB) and Sport England had confirmed that Loughborough University would be the permanent site of the new ECB National Academy. Financial terms and designs had yet to be finalised and it was AGREED that Council needed to see the totality of the package before taking any decisions. In the meantime, progress should not be constrained and detailed proposals would be presented at the next meeting.

• The University had received final clearance to move forward on the LTA Centre of Excellence.

Planned spending on capital projects this financial year now exceeded £40M. Of this sum, about £17M would be funded by grants and gifts, £10M by additional borrowing and the remaining £13M from the University's reserves. Some difficult choices would need to be made and the Bursar warned that the next budget round would be no easier than the last.

The Bursar reported that tenders for the Netball and Badminton Centre were being evaluated. Council APPROVED delegated authority for the Chair to approve the Netball and Badminton Centre to move to Stage E (final approval) subject to a maximum commitment of the budget in the Capital Plan plus 1%.

The Bursar reported that tenders had been received for the Burleigh Court Extensions and were being evaluated for compliance and reliability.

The President of the Students' Union reported that the loss of student accommodation resulting from the proposed extensions was very unpopular and had received a great deal of student complaint. The rooms concerned were good quality en-suite accommodation, traditionally accommodated large numbers of international students and included rooms that had been adapted for wheelchair users. Council was informed that Burleigh Court would meet the cost of refurbishing a new room to meet disability needs. University halls were under great pressure, as hall accommodation had not increased in line with student numbers. The University was in danger of converting the majority of its halls of residence into first year accommodation only.

Council APPROVED delegated authority for the Chair to approve the Burleigh Court Extensions to move to Stage E (final approval) subject to a maximum commitment of the budget in the Capital Plan plus 5%.

The Bursar reported that the University had been advised not to submit an appeal against the refusal of planning permission for the William Morris proposals, as the chances of winning the appeal were not high, principally because the University intended now not to proceed with the planning application over which it would be appealing. The consultant's view had been that the University would not set an unfavourable precedent for future proposals regarding the density of the student population in the town by a decision not to appeal against the William Morris decision.

Council AGREED to waive its decision to appeal against the William Morris decision. Revised proposals would be submitted in due course.

A member commented that the University should inform residents of the University's decision not to appeal against the William Morris decision. This may go some way to improving relations with the community. The Registrar would ensure that the local press were informed.

Council APPROVED renewed delegated authority to the Chair to give final approval to the Ashby Road Halls Refurbishment Scheme, subject to the Treasurer's Committee approving the business plan and legal arrangements.

COUN01-P94

Council NOTED the outcome of bids for the HEFCE Project Capital Allocation Round 2 (2002-2004) (Teaching and IT Infrastructure)

COUN01-P95

In line with HEFCE requirements, the Chair of Audit Committee reported on the 38th meeting the of Audit Committee held on 25 October 2001.

Council was asked to approve the recommendations of the Committee concerning the Engineering Building Board of Inquiry detailed in the agenda paper. Council was reminded that the full report of the inquiry would be circulated once legal advice was that this was appropriate. Initial legal advice was that the report should not be circulated. The Treasurer registered his disappointment at the length of time it had taken to obtain further legal advice. He believed that there remained a gap in the mechanisms for gaining advice on contracts of substance and the University was often pressed to sign contracts without due legal advice. The Registrar and Bursar were charged with addressing this issue. A member commented that the appointment of a project manager was crucial for the success of future projects. If Council accepted the recommendations of the Engineering Building Board of Inquiry, they must apply to ongoing projects and steps would have to be taken to strengthen the review process. The Bursar warned that this would lead to unavoidable delays in the early stages of projects and that the University would have to think carefully about how it implemented the recommendations.

Council APPROVED the recommendation from Audit Committee that the recommendations of the Engineering Building Board of Inquiry be fully implemented.

The Chair of Audit Committee also reported on recognising and assessing risk management within the University. Audit Committee would report to Council on this topic next year.

A member enquired about the Oracle Financial System. The Bursar reported that Oracle seemed prepared to offer an upgraded system, which it was hoped would meet the original contracted specification. Council was reminded that Loughborough was not alone in having failed to successfully implement new financial systems. The caution adopted by the University had been a better option than the unsuccessful implementation of the system, such as that which had attracted a great deal of adverse publicity for Cambridge.

COUN01-P96

Council RECEIVED the Annual Report of the Audit Committee for 2000/2001, which included the report of the Internal Auditors.

Council NOTED that a report from the Council Strategic Planning Conference held on 30 October 2001 had been circulated together with a note of the next stages of the strategic planning process. Faculties and Departments had been asked to develop strategies and targets and would bring them back for discussion at Senate on 13 February 2002.

COUN01-P97

Council APPROVED resolutions concerning the Grove Hostel.

.1 Council APPROVED a recommendation from the Equal Opportunities Committee that it ceased to be a Council Committee and became a Sub-Committee of Human Resources Committee, which was a Joint Committee of Senate and Council.

.2 Council NOTED that the Equal Opportunities Committee formed under 11.1 above would report to Senate on student related issues and Human Resources Committee on staff related issues. Council would continue to receive reports from Human Resources Committee and Senate which would incorporate reports from the Equal Opportunities Sub-Committee.

COUN01-P98

COUN01-P100

Council APPROVED a recommendation referred by Resources and Planning Committee at its meeting on 26 October 2001 regarding tuition fees for International students.

COUN01-P101

Council APPROVED the following recommendations referred by Senate at its 346th Meeting on 29 November 2001.

i. Programme Proposals

1. New Programmes for introduction in the 2001/2002 session:

MSc in Management (Professional)
(MSc award extended to Professional Certificate & Diploma in Management/ Management (Thomas Cook)/Management (FKI) and Professional Diploma in Management (HEA)) (Spring 2002 entry)

MSc Risk & Reliability Methods (Rolls Royce) (October 2001 entry)

b. New Programmes for introduction in the 2002/2003 session:

BSc (DPS) Geography & Management
BSc Business & Law
BA Business & Social Studies
BA Law & Social Studies
MSc Sports Biomechanics
MSc Sport and Exercise Physiology
MSc Physical Activity & Health
MSc Policy-making in the European Union
MA Media & Cultural Analysis
MSc Information and Knowledge Management

2. New Programme Title in 2001/02:
   
   MSc Construction Innovation and Management, to replace MSc Innovative Construction
3. New Programme Titles in 2002/03:

BSc Geography & Leisure Management, to replace BSc Geography & Recreation Management
BSc Physics and Computing, to replace BSc Physics with Computing

4. New Awards for 2001/02:
   
   Award of DPS for BSc Geography/ Geography with Economics/ Geography & PE & Sports Science/ Geography & Recreation Management
5. Discontinuation of the following programmes:

2. The establishment of new prizes and altered conditions to an existing prize.

COUN01-P102

Council ratified the action of the Registrar in affixing the University Seal to the documents.

COUN01-P103

Council RECEIVED the Annual Report of the Alumni Association for 2000/01.

(separate enclosure)

Council RECEIVED the Annual Report of the Loughborough Students' Union for 2000.

COUN01-P104

Council RECEIVED a report from the Loughborough University Development Trust and summary financial statements for the period to 31 July 2001.

Council RECEIVED reports from the following Committees.

i. Senate of 24 October and 29 November 2001

COUN01-P105

ii. Resources and Planning Committee of 26 October 2001

COUN01-P106

iii. Research Committee of 1 November 2001

COUN01-P107

Wednesday 20 February 2002

Author - M T Whyte
Date - January 2002
Copyright (c) Loughborough University. All rights reserved.