The financial woes facing London Metropolitan University are intensifying as the funding council confirms plans to claw back the full amount of money the university has been overpaid since 2005.

In a message sent to all staff last week, Brian Roper, the university's vice-chancellor, warned that the undisclosed sum - which comes on top of a ?15 million reduction in the university's grant for this year - was likely to be "very substantial" and meant that large-scale compulsory redundancies would now be "a very real requirement".

The overpayments, which the Higher Education Funding Council for England said arose from problems with the university's data on student dropouts, were revealed by Times Higher Education last July.

At the time, Hefce said it planned to reduce the university's teaching grant by ?15 million in 2008-09 and was considering clawing back other funding for the three previous years.

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In an email sent on 8 January, Mr Roper says that Hefce notified him just before Christmas that it was "minded to recover in full" the overpayment London Met received between 2005 and 2008.

"The exact amount will not be known until February 2009, but Hefce has indicated that it is likely to be a very substantial amount and will be a one-off cost," Mr Roper says.

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However, the email also informs staff that Hefce is considering investing in the university through its Strategic Development Fund if it is satisfied that the university can permanently reduce its operating costs.

The university's 2009-18 strategic plan was approved by its board of governors in November, but Mr Roper's latest message says that "in the circumstances", some aspects of the plan "may take longer to be realised or in some instances may not be pursued".

He says: "I have alerted you to the possible need for large-scale compulsory redundancies ... and I very much regret that this is now no longer a possibility but a very real requirement."

A fourth round of voluntary redundancies is planned, and Mr Roper says it is likely that the university will be able to afford to pay only statutory terms for subsequent compulsory redundancies, which will be "significantly less" than is currently received.

A Hefce spokesman confirmed that its board had decided to recover the funding from previous years but would not confirm the sums involved. A timescale for the repayments is being negotiated and, according to the university, Hefce is likely to retrieve the money in stages.

A spokeswoman for the University and College Union branch at London Met said: "If the threats in Mr Roper's email are real, the UCU fears the job losses envisaged will seriously damage the university. Management, Hefce and the Government should be aware that the UCU will fight vigorously to defend the interests of its members and the university."

In October, Mr Roper called for the universities of Oxford and Cambridge to go private, arguing that government money was better spent on universities "that transform people's lives" rather than on "finishing schools" for the privileged.

Student dropout rates affect the level of teaching grant that Hefce allocates to universities.

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rebecca.attwood@tsleducation.com

UCU OFFICER IS DISCIPLINED FOR ABSENCE ON UNION BUSINESS

The lecturers' trade union is threatening industrial action at London Metropolitan University over moves to discipline a senior union officer.

Amanda Sackur, chair of the University and College Union co-ordinating committee at London Met, has had disciplinary procedures taken out against her after she left the university to take part in union activities in Nottingham.

Managers are understood to have accepted that Dr Sackur spent more than nine hours on academic work on the day in question, but contend that her absence from London Met's premises between 9am and 5pm was unauthorised.

The UCU said the matter raised questions about lecturers' terms and conditions, as there had never been an explicit requirement that they stay on university premises. It said it represented an attack on the union ahead of job cuts.

Sally Hunt, UCU general secretary, wrote to Brian Roper, the vice-chancellor of London Met, on 19 December expressing "extreme concern and surprise" at the disciplinary action.

She had asked Dr Sackur to visit Nottingham Trent University in her capacity as a national executive committee member, Ms Hunt said.

Barry Jones, UCU assistant general secretary, warned members on the same day that the action "may be an attempt to soften the union" in advance of Mr Roper's plan for large numbers of compulsory redundancies at the university.

A resolution passed by five of the six London Met UCU branches - the sixth had not met as Times Higher Education went to press - said the use of the disciplinary procedure was "a breach of the spirit of the (union) recognition agreement", which allows time off for union activity.

Members resolved to declare a dispute over "management attempts to change custom and practice and whittle away the recognition agreement"; to organise protests over the disciplinary procedure against a union officer and to ballot for industrial action if "victimisation" of officers continued.

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London Met declined to comment.

melanie.newman@tsleducation.com.