BUFDG Digest 9 March

CHAIR’S QUARTERLY

After February’s storms, we published our most recent Quarterly on the 1^st March, and we’re sure it was completely responsible for the arrival of Spring. The first article takes the opportunity to talk you through the key plenaries at the BUFDG Finance Festival, which starts next week (more on this below). In our second article, Karel asks whether your university needs a Chief ESG officer, as we all become increasingly familiar with global environmental and social challenge. It’s a topic we will return to at the Annual CFO Meeting in Bristol in May.

Next, Dr Ant Bagshaw (formerly Wonkhe, and now at OES) talks us through what the ‘return to normal’ might mean for our online education strategies, before ATFS’ new recruit Carl Fleet explains the state of play in the world of payments, including open banking. Finally, BUFDG’s employment taxes specialist Julia explains what your universities will need to do in response to the NIC increases for the Health and Social Care Levy. You can download the Quarterly via the BUFDG website here.

FINANCE FESTIVAL

The BUFDG Finance Festival starts on Monday. We’ve extended the booking deadline until 5pm today (Wednesday 9) so if you are on the fence and haven’t booked yet, please don’t delay any longer.  If this is all new to you, the Festival is completely FREE to all BUFDG members, and runs for three days from Monday 14 – Wednesday 16. The programme is available here, and once you’re booked on, you can attend as many or as few sessions as you wish, as your interest/diary allows.

SECTOR / GENERAL

The big news that fell just after the last Digest came out was the government’s publication (finally) of its response to the Augar review of post-18 education in England. As you might expect, there has been a huge amount of commentary and analysis undertaken over the days since. HEPI has a 10-point summary, with the usual broad range of coverage from Wonkhe, including on the possibility of a ‘third way’ between open market and number-cap systems, the outlook for students past and future, and the implications for devolved administrations. The feature that made the most headlines perhaps was that covered by the IFS – was the ‘highly-regressive’ nature of the changes to the fees system. IFS Director Paul Johnson provides a summary here, with the detail from Ben Waltmann.

The National Audit Office (NAO) has published a report on the financial sustainability of HE providers in England. It’s a broad review that covers the operation and performance of the OfS as well as the assessment expected from the title, but among its findings are: “of the 80 providers with an in-year deficit in 2019/20, 20 had been in deficit for at least three years”, and; “during 2020/21, 33 out of 247 providers (13%) had forecast liquidity below 30 days”. Perhaps the nub of the issue though is the observation that “Short-term financial risks are dominated by COVID-19, but medium- and long-term risks are systemic” – in particular that publicly funding teaching and research at most providers is loss-making and is only propped up by “cross-subsidy …from fees paid by international students”.  A fascinating read, and one summarised by the team at Wonkhe.

MA / TRAC

A couple of years ago Exeter CFO Andrew Connolly wrote an article for Wonkhe on why costing matters, and how to make it better. Following the outcome of the OfS review of TRAC at the end of last year, Andrew has produced a follow-up that explains the shortcomings of the current nationalised approach to costing activity. Among other points, the article argues that the benefits of TRAC don’t match up with its costs, that the process is still misunderstood (and it’s not through a lack of (or lack in quality of) communication, and that TRAC for teaching is increasingly outdated in the world of blended delivery, micro-credentials, and Lifelong Learning. It’s well worth a read.

TAX

The BUFDG 2022 Tax Conference will take place on Wednesday 15 and Thursday 16 June 2022 at Burleigh Court, Loughborough.  We will provide updates on what’s being planned for the conference in each TaxHE edition from now until June. Andrea and Julia are currently looking through all the sessions ideas from our members and advisers.  They will publish a ‘first look’ itinerary in the coming weeks. In the meantime, HMRC have confirmed that they will be attending the conference and have asked members what they would like to hear from them.  Please provide your feedback here. 

HMRC have updated their guidance on who should register for PPT and issued clarification “If you import plastic packaging components already filled with goods, you do not need to include the weight of the goods inside.”  Meanwhile, a few universities have been reviewing import data and finding some good news when assessing whether they are near the 10 tonnes import limit.

There’s a Time to Talk session on Corporation Tax and VAT cultural reliefs for theatres, orchestras and museums and galleries, online from 10am to 11am on 31 March. In this back-to-basics session Anne Wilson and Robert Warne from Crowe UK LLP will provide an overview of the VAT and Corporation Tax issues that need to consider when undertaking cultural activities.

The National Tax Group meeting will take place on Wednesday 9 March. If you have any points that you would like the group to discuss, please contact Andrea.  (This meeting is for Group members, but if there is something specific that you would like discussed and raised, BUFDG members can attend by invite.)

EMPLOYMENT TAXES

The final regional PEG for spring has now concluded and given BUFDG a great list on how we can support your payroll and employment taxes compliance.  Over the next few months, we will be working on the following areas: Health & Social Care Levy explanatory employee guide; Simplifying benefits for tax and HR, and; Student entertaining and tax exemptions. And there is more information on what we will be doing and how you can get involved is available here. If there’s anything we’ve missed that you think should be added to our ‘to do’ list, please email Julia.

Michelle Perry from Grant Thornton joined us in February to discuss the employment tax implications of providing entertaining to your staff and students.  A recording of the session is available and acts as a ‘back to basics’ on what is staff or business entertaining, with particular emphasis on students.

There’s a HMRC consultation that seeks views on the draft regulations for the DOTAS NIC regime, which would amend existing regulations to allow HMRC more flexibility at an earlier stage, where they suspect tax avoidance. If you have any comments on the consultations that you would like BUFDG to feed back to HMRC, please contact me.

HMRC has issued guidance on whether you can claim employer Class 1 NIC relief when you employ someone in a freeport tax site.  Review latest maps in freeport regions and a summary of HMRC’s guidance on NIC relief.  

Marie Green and her team at PwC have published their latest update on global mobility for the HE sector with lots of their welcomed and informative articles already published on BUFDG’s website. Included within PwC’s update is Business travellers – What do universities need to consider?  The document highlights those areas where universities may need to consider applying for an Appendix 4 agreement for visitors temporarily attending the UK campus from overseas (where they are not employed by the university). Following PwCs latest Time to Talk session, there were questions around whether an Appendix 4 agreement was appropriate for universities as most individuals (even from overseas) would be employed by the UK university.

You can find all tax updates (and there are a lot!) as usual in the most recent TaxHE fortnightly newsletter.

OTHER

Our colleagues at AUDE are hosting an online session on supply chain, materials and inflation with their business partner Sir Robert McAlpine on 24 March. This is all useful knowledge in your conversations with Estates and Procurement colleagues, and BUFDG members are welcome to book.

UUK’s The scale of UK transnational education report has been updated to include figures for 2020-21.  This may be a useful document if you are trying to decide which countries to focus on when looking at the issue of on-line learning. UUK report that “UK degrees were delivered in over 225 countries and territories in 2020-21. UK TNE delivery is concentrated mainly in Asia, which accounts for around half of all student numbers. This is followed by the EU, the Middle East and Africa. In 2020-21, China was the country hosting the most UK TNE students (61,495), followed by Malaysia (48,460), Sri Lanka (37,175), Singapore (27,875), Egypt (23,805) and Hong Kong (22,480). The top five host territories account for 38.9% of all UK TNE student numbers.” 

For our Job of the Fortnight, the Liverpool School of Tropical Medicine (LSTM) is recruiting a Financial Accountant. The ideal candidate would have “experience of financial management and reporting, treasury management, dealing with multi companies and multi currencies, as well as of working with specialised Financial Information Systems for managing online financial transactions and reporting”. The deadline for applications is 20^th March.

There are other vacancies listed as usual on the BUFDG jobs page.