Research groups paying the price for Aalborg University's "financial irresponsibility"
The staggering deficits resulting from expansion into Copenhagen is trickling down to all areas of the university
Aalborg University’s (AAU) expansion in Copenhagen has caused financial woes that are having serious consequences to its employees and the quality of the education it provides, an employee at the university alleges.
The employee, whose identity is known by The Copenhagen Post but who wishes to remain anonymous, said that their research group is among the lower level groups that are paying for the irresponsible budgeting of university management.
“The kicker for us at the lowest level is that management has been so irresponsible (e.g., rents; furniture) and yet we are the ones to pay,” the employee said. “Here in Aalborg, my research group has already moved twice to cut costs in rent. And we have slashed everything.”
The source argued that it was incomprehensible why the university was unable to adequately budget its investments.
“It's also annoying, this whole ‘spending without thinking/planning’. My research group was a private research institute before joining AAU so we have always budgeted and we have always made fiscally-responsible decisions. And now we are being forced to balance the 2014 budget this year.”
Not about furniture
Aalborg University has been active in the Copenhagen area since 2002 and has had a campus in Ballerup since 2005. But in 2012 that campus was combined with other activities in Frederiksberg and Hørsholm to create a large campus in Sydhavn. According to the source, the university is still paying rent on the Ballerup location.
"Talk about financial irresponsibility – paying two rents with the second one being outrageously expensive," the source said. "I suppose they wanted a more prestigious address."
Jyllands-Posten newspaper reported in late November that Aalborg University had spent an excess 13 million kroner on furnishing the new Sydhavn campus.
But according to an email that the university wrote to its employees and that The Copenhagen Post has read, the financial issues derive not from furniture expenses, but the expansion into Copenhagen and a massive increase in student intake, which won’t begin to pay off until they begin graduating in two year’s time.
“The executive management has also addressed AAU investments in the Copenhagen Campus Sydhavnen, where an amount of DKK 70 million was spent on the establishment and operations of facilities to accommodate the large increases in student intakes in 2012 and 2013," the email read. “Compared to 2011, student numbers increased by 53 percent in 2012 and by 127 percent in 2013.”
A tough 2014 ahead
The university budgeted for a 33 million kroner deficit in 2012, but instead ended up with a staggering deficit of 165 million kroner. This year, the university expects to run a 65 million kroner deficit.
The university revealed that measures were being taken to correct the financial difficulties, but admitted in the employee email that 2014 will be a tight fiscal year dedicated to correcting the deficit generated by the move.
“As regards 2014, the university board has announced that AAU must strike a balance between income and expenses, and that we must make up for the additional expenditure of DKK 20 million from 2013,” the email said.
Spreading the cost
The university has cut funding and staff to reduce expenditure, but warned that a number of “efficiency targets” were still being identified throughout the university’s academic and administrative areas. That was backed up by the source who spoke with The Copenhagen Post.
“The management is simply spreading the cost down to the lowest level. Plus, the upper management at the faculty level is now taking a larger share of the overheads, which leaves the local departments in a bind. So my department was suddenly stuck with a negative in the budget of over 5 million kroner,” the source said. “The IT department tells me my computer is at its end, but I'm not allowed to request a new one even though, in theory, the university pays for equipment.”
Aalborg University is due to approve its 2014 budget by the end of this month.