Donations to universities are at a record high. Why does half go to Oxbridge?

Probably because they spend more.

A report released yesterday by the National Centre for Social Research shows that during 2011-2012 the UK’s universities received more money from philanthropists than ever before. A total of £774m was given, up from £676m in 2010-2011.

The UK’s top universities are receiving the majority of these gifts, with Oxford and Cambridge alone receiving half of the total amount given last year. It can be no coincidence, however, that the universities that receive the most are also spending the most on fundraising.

Out of the 143 institutions that took part in the survey, which was carried out for The Council for Advancement and Support of Education (CASE) and the Ross Group, Oxbridge and Russell Group universities received an enormous £644 million of the total given, with the remaining 119 universities receiving just £130 million between them. Twenty nine universities received donations of less than £100,000.

While many will attribute this imbalance to the fame and prestige of Oxbridge and Russell group universities — Michael Moritz’s gift of £75 million to Oxford last July makes up a substantial portion of the total given during 2011-2012 — the report suggests that, far from resting on their laurels, the top institutions are working hard to attract funding.

Anyone familiar with the challenges of fundraising knows that you have to spend money to make it. This is borne out by the fact that the universities that are receiving the largest donations are spending the most on attracting philanthropists: out of a total of £79 million spent on fundraising initiatives by the 143 participating institutions, £50 million was spent by Oxbridge and the Russell group universities — just 24 institutions in total.

The remaining 119 institutions spent just £29 million between them on fundraising, which averages out at £244,000 per institution as opposed to just over £2 million for the Russell group universities (including Oxbridge).

Interestingly, the figures also illustrate that while together the Oxbridge and Russell Group Universities made about £12.88 for every £1 spent on fundraising, other universities only made about £4.48 for every £1 spent.

This could be due to scalability, as Oxbridge and Russell Group institutions depend on large fundraising and development offices. Oxford and Cambridge alone employed 310 fundraising staff between them last year, and the Russell group employed 422. The other 119 institutions had only 429 fundraising staff between them – equivalent to 3 per university.

It might seem unfair that a handful of leading universities are receiving the vast majority of philanthropic gifts made to the UK’s higher education sector. But the CASE report suggests that these institutions are not merely cashing in on their fame, but making a sustained effort to attract the attention of private donors; to the UK universities that received little last year, it should therefore serve as a reminder that spending money can make you money.

This article first appeared in Spear's magazine.

Utter punts. Photograph: Getty Images

Mark Nayler is a senior researcher at Spear's magazine.

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The tale of Battersea power station shows how affordable housing is lost

Initially, the developers promised 636 affordable homes. Now, they have reduced the number to 386. 

It’s the most predictable trick in the big book of property development. A developer signs an agreement with a local council promising to provide a barely acceptable level of barely affordable housing, then slashes these commitments at the first, second and third signs of trouble. It’s happened all over the country, from Hastings to Cumbria. But it happens most often in London, and most recently of all at Battersea power station, the Thames landmark and long-time London ruin which I wrote about in my 2016 book, Up In Smoke: The Failed Dreams of Battersea Power Station. For decades, the power station was one of London’s most popular buildings but now it represents some of the most depressing aspects of the capital’s attempts at regeneration. Almost in shame, the building itself has started to disappear from view behind a curtain of ugly gold-and-glass apartments aimed squarely at the international rich. The Battersea power station development is costing around £9bn. There will be around 4,200 flats, an office for Apple and a new Tube station. But only 386 of the new flats will be considered affordable

What makes the Battersea power station development worse is the developer’s argument for why there are so few affordable homes, which runs something like this. The bottom is falling out of the luxury homes market because too many are being built, which means developers can no longer afford to build the sort of homes that people actually want. It’s yet another sign of the failure of the housing market to provide what is most needed. But it also highlights the delusion of politicians who still seem to believe that property developers are going to provide the answers to one of the most pressing problems in politics.

A Malaysian consortium acquired the power station in 2012 and initially promised to build 517 affordable units, which then rose to 636. This was pretty meagre, but with four developers having already failed to develop the site, it was enough to satisfy Wandsworth council. By the time I wrote Up In Smoke, this had been reduced back to 565 units – around 15 per cent of the total number of new flats. Now the developers want to build only 386 affordable homes – around 9 per cent of the final residential offering, which includes expensive flats bought by the likes of Sting and Bear Grylls. 

The developers say this is because of escalating costs and the technical challenges of restoring the power station – but it’s also the case that the entire Nine Elms area between Battersea and Vauxhall is experiencing a glut of similar property, which is driving down prices. They want to focus instead on paying for the new Northern Line extension that joins the power station to Kennington. The slashing of affordable housing can be done without need for a new planning application or public consultation by using a “deed of variation”. It also means Mayor Sadiq Khan can’t do much more than write to Wandsworth urging the council to reject the new scheme. There’s little chance of that. Conservative Wandsworth has been committed to a developer-led solution to the power station for three decades and in that time has perfected the art of rolling over, despite several excruciating, and occasionally hilarious, disappointments.

The Battersea power station situation also highlights the sophistry developers will use to excuse any decision. When I interviewed Rob Tincknell, the developer’s chief executive, in 2014, he boasted it was the developer’s commitment to paying for the Northern Line extension (NLE) that was allowing the already limited amount of affordable housing to be built in the first place. Without the NLE, he insisted, they would never be able to build this number of affordable units. “The important point to note is that the NLE project allows the development density in the district of Nine Elms to nearly double,” he said. “Therefore, without the NLE the density at Battersea would be about half and even if there was a higher level of affordable, say 30 per cent, it would be a percentage of a lower figure and therefore the city wouldn’t get any more affordable than they do now.”

Now the argument is reversed. Because the developer has to pay for the transport infrastructure, they can’t afford to build as much affordable housing. Smart hey?

It’s not entirely hopeless. Wandsworth may yet reject the plan, while the developers say they hope to restore the missing 250 units at the end of the build.

But I wouldn’t hold your breath.

This is a version of a blog post which originally appeared here.

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