¡°All options are on the table¡± as UK universities brace for another round of cost-cutting at the start of the academic year, with a new generation of students arriving to find many institutions in a state of turmoil.

Fears over cash shortages have become the primary concern for financial officers across the country, which some believe could tempt institutions into ever riskier and short-term decisions to meet their immediate obligations.

A range of institutions is understood to be affected ¨C including some unexpected names ¨C with a handful facing a real threat of bankruptcy and many more needing a full transformation to survive.

Most universities postponed all major decisions until after clearing, with some ¡°wishful thinking¡± that strong recruitment could resolve the crisis, according to Liesbeth Corens, senior lecturer in history at Queen Mary University of London, who has been tracking redundancies since the start of the crisis.

É«ºÐÖ±²¥

She predicted that there would be a crunch in September and October, with more redundancy schemes announced, including compulsory job losses, fixed-term contracts not being renewed and, potentially, whole departments axed.

The impact of the cuts that have already been enacted will also be felt by incoming students, she said, with modules disappearing as a result of?lecturers losing their jobs and potential issues with administrative processes such as enrolment because of the departure of swathes of professional services staff.

É«ºÐÖ±²¥

Even the universities that had a good clearing period face issues, with rising numbers of dropouts and no-shows meaning that student numbers might not settle for several weeks.

Universities must wait until November to receive the first quarter of student loan payments, with another quarter in January and the rest in May, leaving them potentially lacking cash in the autumn and spring.

Traditional lenders are understood to be reluctant to provide additional credit in the current circumstances, leaving few options for those in need of money fast.

One financial expert described ¡°vultures circling¡±, with hedge funds prepared to provide advances on student loan receipts, but only in return for high interest rates.

Other options include deals such as?the one done by the University of Kent, which sold a leasehold on an accommodation building last year and then leased it back, providing immediate cash in return for decades of rent obligations.

É«ºÐÖ±²¥

There has been some speculation that this could be extended to universities selling off successful elements of their provision to private providers or wealthier institutions.

James Brackley, lecturer in accounting at the University of Sheffield and the co-author of a? that ascribed a risk score to every UK university based on several factors including debt levels and net cash inflow, said there were universities in trouble ¡°in every category¡±, with ¡°aggressive growth¡± and high reliance on international income the two main factors adding to the stress.

¡°The actual number properly facing bankruptcy is in single figures ¨C perhaps four or five ¨C but there is another, much larger group that are almost certainly going to have to close lots of courses, change their delivery model and sell off some assets,¡± he said.

É«ºÐÖ±²¥

John Raftery, a former vice-chancellor who led turnarounds at London Metropolitan University and the University of Wolverhampton, said staff costs were the single biggest expense for all institutions, but leaders should ¡°take a balanced view, and no options should be off the table¡±.

¡°Institutions are going to have to reschedule and postpone some maintenance, you¡¯ve got to be sensible and manage your cash, and v-cs have a responsibility to help people understand why that is being done,¡± he added.

¡°Back-office restructuring ¨C and sharing services among many institutions ¨C is the obvious long low-hanging fruit which has not been picked because it is seen as too difficult.

¡°That¡¯s because we make it too difficult, and government needs to not only remove the impediments to restructuring mergers but put encouragements in place.¡±

É«ºÐÖ±²¥

tom.williams@timeshighereducation.com