A UNION has called for urgent clarity from Edinburgh University after it published an “incorrect” memo that said the cash-strapped institution had purchased an iconic A-listed office block while it was laying off staff.
An internal communication from the university to staff in late March – shared with The Ferret – said it had bought the former Scottish Widows building opposite Edinburgh’s Commonwealth swimming pool the previous month.
However, in response to queries from The Ferret, a spokesperson for the university denied it had bought the building. They did not explain how the miscommunication had occurred.
Pressed further, a spokesperson said: “At this stage, all we can say is that any information suggesting the university has bought the building is incorrect.”
The property on Dalkeith Road in the Newington area of the city is known for its distinctive brown hexagonal buildings.
Staff reacted with anger and disappointment to the confusion around the purchase, while the union said it had now lost any remaining trust it had in management.
The information was shared in an online post just weeks after the university announced £140 million of cuts over the next 18 months. The Ferret understands the post was taken down a few days later.
On Friday, the University and College Union (UCU) branch released an analysis claiming that up to 2000 jobs might be at risk and more money than ever is being spent on buildings.
The Scottish Widows building, said the memo, was bought as part of the university’s “capital plan” to continue its commitment to “world-class facilities” for students and staff.
The Edinburgh branch of the University and College Union (UCU) called for urgent answers over the confusion and for clarity about whether buying the property was, or is, under consideration.
The university told staff it had purchased the building in answer to a question posted on an internal online hub. The Ferret understands the question reflected longstanding rumours circulating among Edinburgh staff.
The union said the rumours were fuelled by the lack of “transparency and accountability” surrounding capital expenditure at the university. It claimed “finance and capital” were “driving the direction of the university rather than teaching and research”.
Scottish Labour said “overstretched” university finances meant it was “more important than ever” that “all financial decisions are sound and high standards of transparency are being held”.
The Dalkeith Road site has been vacant since 2020.
But plans to redevelop it into a “business hub” and nearly 200 apartments – of which 35% were expected to be “affordable” – were approved by the council in 2023.
The cost of that refurbishment – which would include replacement of the building’s glass facade because it contained “significant amounts of asbestos” – was previously estimated to be £100m.
University of Edinburgh management has blamed factors including a fall in the recruitment of international students, “longstanding” underfunding of Scottish undergraduates and rising staff costs for its financial troubles.
But the UCU – which is balloting members on strike action – has accused senior staff of “manufacturing a crisis” to justify cuts and claim the biggest threat to its finances is “unrestrained” capital spending on things like buildings.
A number of universities across Scotland – including Dundee, Robert Gordon and Aberdeen – are facing financial problems.
The body that represents Scotland’s higher education institutions, Universities Scotland, argues the root cause of the crisis is underfunding. The amount the Scottish Government gives universities for each Scottish student has declined in real terms for more than a decade.
Universities have become increasingly dependent on income from international students – who often pay tens of thousands in fees – to plug the gap. Analysis by The Ferret last year showed seven of Scotland’s universities relied on international fees for more than a quarter of their total income in the 2022-23 academic year.
There has been a fall in recruitment of non-EU students this year, partly because of a change to UK Government visa rules which made studying in Britain less attractive.
Funding pressures have meant some universities have recorded operational deficits in recent years. Edinburgh, however, has continued to record surpluses – although it says these are now not sustainable – and has significant assets which the UCU claims could be used to stave off job cuts.
The union claims management has not been transparent in sharing details of modelling to forecast future deficits, and that the target of £140m in cuts had been set “arbitrarily”. It also claims senior staff are incentivised to view buildings as “assets” and staff as “costs”.
Announcing the scale of cuts in February, principal Sir Peter Mathieson claimed in an email that “steadily rising” staff numbers and pay rises in recent years had meant the amount spent on staff was “no longer sustainable” and had to be reduced.
He wrote that capital spending was also being reviewed but reducing this would “only be a short-term measure” and would “do nothing to address the underlying issues”. The university’s provost, Kim Graham, said at the start of April that it was “exploring opportunities to dispose of buildings which are no longer strategically critical to the university”.
Mathieson himself has faced scrutiny for his pay packet and expenses.
He is one of the highest earners in Scottish academia and staff said they had been left “speechless” to learn Mathieson had received a 2.5% pay rise in January, the month before he announced the scale of cuts the university is planning to make.
The Ferret also revealed in March that Mathieson had taken a second job at a company linked to the university last year, which critics said could distract him from the problems facing the institution.
According to Sophia Woodman, president of the Edinburgh branch of the UCU, the confusion around the mix-up over the purchase “makes it extremely difficult” to “trust anything” university management says.
“Yet I’m not even that surprised,” she told The Ferret. She claimed that graphs shared showing cashflow “have subsequently been changed”.
Woodman continued: “Peter Mathieson has said in public that he has shared detailed financial modelling when all we’ve had is eight slides, two of which were title slides.
“It means we all wonder if the underlying assumptions could also be wrong.”
She called for “urgent clarity” and for the university to confirm whether buying the Scottish Widows building “had been under consideration”.
A university spokesperson told The Ferret: “The university has not acquired 15 Dalkeith Road. We are reviewing all capital expenditure as we assess affordability across all university activities.”
'Marie Antoinette moment'?
MEANWHILE, a new freedom of information (FoI) request shared with The Ferret has revealed guests were wined and dined at the private home Mathieson lives in free-of-charge in the affluent new town area of the city.
The university said 10 events had been hosted at the property since November 2023. Guests enjoyed delicacies including champagne, caviar crème fraiche, and wild mushroom and truffle arancini.
At one end-of-year reception for 40 staff, seven bottles of wine and 10 bottles of prosecco were downed. Guests also enjoyed canapes such as avocado on savoury biscuit and haggis bon bons, whisky and mustard. The cost of that event was £906.
At a working dinner last June, 14 people had gin-cured salmon, potato veloute and turnip chou croute, alongside a prime Scotch fillet of beef. Three bottles of £65 champagne were also drunk at the event which cost £1300.
Edinburgh University said in the FoI response that the principal’s residence was “not solely used as a family home, but is also as a venue for hosting formal university events.
“This includes events to welcome international guests, which strengthens the university’s global reputation and increases our partnerships and potential funding streams,” it argued.
Referring to the events at Mathieson’s house, Scottish LibDem leader Alex Cole-Hamilton claimed it could be Edinburgh University’s “Marie Antoinette moment”.
He added: “Constituents are contacting my office concerned about their jobs. They will have absolutely no truck with lavish spending from university bosses when they and their colleagues are staring down the barrel of compulsory job cuts.
“Since the news of prospective cuts emerged, I have been in contact with the principal about the situation at the university and I will keep up the pressure on behalf of all the staff and students who this will affect.”
Scottish Labour’s education spokesperson Pam Duncan-Glancy said: “At a time when university finances are so overstretched, it is more important than ever that all financial decisions are sound and high standards of transparency are being upheld.
“However, university funding in Scotland is fundamentally no longer fit for purpose and Scotland’s world-class universities are being put at risk and young Scots are being failed as a result.”
A spokesperson for Edinburgh University said: “The university has not acquired 15 Dalkeith Road. We are reviewing all capital expenditure as we assess affordability across all university activities.
“The principal’s residence is often used as a venue for hosting formal university events to welcome an array of guests, such as dignitaries, international partners and other supporters. All hospitality was provided using standard menus from our internal university catering service.
“These events help to enhance the university’s reputation, strengthen our partnerships and potential funding streams.”
