Oxbridge college waste, 19/11/01 (original) (raw)
OXBRIDGE COLLEGES CALLED TO ACCOUNT
Government weighs political risks of ending tax benefits
Report by David Walker in The Guardian, 19th November 2001 - Guardian link
See also article in Accountancy Age
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A Cabinet Office investigation has found that 80 of the best-endowed charities in the country do not file regular accounts with the charity commission - yet receive millions of pounds in public support each year. They are the colleges of Oxford and Cambridge universities, and their future status is now the subject of close advisers at No 10.
Abolition of their charitable status and the tax exemptions it brings is an option, although the prime minister has yet to be convinced that he wants the political flak that would accompany an assault on these well-connected institutions. One of the prime minister's informal business advisers, Lord Browne, the chief executive of BP Amoco and a fellow of St John's College, Cambridge, is understood to want a thoroughgoing overhaul of how the universities are run.
Cabinet Office officials have been dismayed to discover that no one, including the higher education funding council, seems to know exactly how much the colleges receive from the state. A spat between the ancient universities and the government over the special fees undergraduates are charged by the colleges seemed to have been resolved two years ago with an agreement over 10 years to shift money previously paid direct to colleges to the university administrations for them to distribute.
But now the government's official thinktank, the Performance and Innovation Unit in the Cabinet Office, has uncovered what it regards as "anomalies" in the status of the colleges. It is studying the future of charity law and wants to redefine charitable status according to whether institutions "benefit the community at large". Oxbridge colleges are also outside the reach of the national audit office, the operational arm of the comptroller and auditor general, who is responsible to the Commons for ensuring public money is properly spent.
College heads protest that data on their endowment income and spending is available. The public can find out that, for example, King's College, Cambridge each year spends over £130,000 from its endowment on entertainment, half as much again as it spends on "supervision", college teaching for undergraduates. But it also spends on lectures; Cambridge teaching, like Oxford's, is based on a complicated set of transactions involving the colleges and the university. In Oxford, college accounts are compiled according to a special code that departs from normal accountancy practice. Data is available from the university "chest", or finance department, on payment of £60. College accounts are also lodged in the national copyright libraries. Cambridge publishes college accounts annually in a special edition of its internal bulletin.
The charity commission says that the colleges enjoy exemption from the rule that all charities with an annual income in excess of £10,000 have to submit accounts. Grant-maintained schools and other higher education institutions are also exempt. Colleges' traditional autonomy has already fallen foul of Labour's wish to broaden participation in higher education. Gordon Brown, the chancellor, angered dons by criticising the decision of Magdalen College, Oxford, not to accept a bright student from the north-east, Laura Spence.
However, No 10 and the Treasury know that some academics would welcome a radical restructuring of the relationship between the university, which grants degrees and organises research, and the colleges which accept students and arrange their teaching.
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