Tom Beardsworth: Why it’s time to get big-money out of university education.
Cherwell reported last week on the extent to which Oxford continues to rely on large donations from wealthy individuals. There is no doubt that universities rely on philanthropy; this will become ever more the case as central government slashes higher education budgets. As students we benefit from the facilities and teaching that donations allow. The Said Business School, founded with £23 million seed money from Wafic Said, and the Blavatnik School of Government, which with a £75 million gift from the Russian billionaire, will take its inaugural class this year, both enhance the educational opportunities that Oxford offers in competition with other global leaders.
Why then would we wish to restrict big-money donations? Most donors have been well-regarded philanthropists but others, it must be said, have made their money in a less-than-scrupulous fashion. Said made his fortune courtesy of the Saudi Royal family, and achieved notoriety for the Al Yamamah defence contract between BAE and the Saudi Air Force which later led to charges of corruption in a US court. Another benefactor of the school, the Italian industrial giant ENI, has fallen victim to charges of institutional bribery. The dirty money trail has brought the university into disrepute, feeding the perception that Oxford’s dreaming spires are the playthings of oligarchs and klepotocrats.
Why does it matter where the money comes from, as long as it goes to good use? Well we have to recognise that other factors should be considered alongside, and occasionally trump, the amount of money that is being given. Most importantly the University should think about its integrity, which it too often neglects. Philanthropy to renowned educational institutions like Oxford is a classic way for businessmen to legitimise their wealth if its source would otherwise be condemned. If the University takes money from an arms deal then it, and by extension we, wholeheartedly endorse the practice. It’s the same argument that Exeter College provoked earlier this year, when it profited from Christian Concern, a bigoted anti-gay group, using college accommodation over the vacation. The income would have benefitted students, but ultimately they did not want to pay the price of association entailed by accepting the money. The college latterly donated the money to charity. Aren’t the University’s vetting procedures sufficient to filter out dodgy donors and keep the well-intentioned ones? I’d argue that they aren’t, as the Said case shows. When big-money is offered, dollar signs inevitably float about the administrators’ heads, prejudicing the Board’s decision. But the case for a cap is more fundamental. It’s about the character of the institutions we participate in.
Where will it end? If the ‘British Petroleum Oxford Ecological Institute’ and the ‘Roman Abromovich Centre for Management’ taste bitter to you, then it’s because what we value about quality education – its intrinsic merits – are debased by the rotten foundations which underpin them. In the long-term Oxford will be fine, with good facilities and dynamic teaching. What is in danger is our reputation, which can rapidly evaporate. The University is fortunate in its wealth of successful alumni. We should therefore aim for a plurality of small to medium sized donations, allowing us to cap the big ones. Small is beautiful. Let’s make it that way.
Isabelle Westbury: Capping donations is severing a much needed lifeline for our universities
On discussing the topic of wealthy donations to educational institutions, the most immediate concerns that may spring to mind are the occasional less-than-legitimate methods by which some donors acquire their vast fortunes – a topic the popular media love to publicise. However, the most immediate issue here is not the source of these donations, through unscrupulous means or otherwise, but more the amount and whether this should have a limit imposed upon it.
Of course, on receiving donations, the source, reputation and background of that donor should always be taken into account. It will always be a fine line which divides the necessity for donated funds and the morality of the donor contributing said funds. Don’t be misled in believing that this is a matter taken lightly, however. Notwithstanding any unwanted temporary negative publicity, it is firmly in the interest of any university to judge wisely on the donations they receive; not only are the finances at stake, but the reputation and morality of said university also come under scrutiny and can leave a lasting mark – much more damaging than any one-off cash boost. Oxford University has a policy in place whereby they will only “…consider gifts from that donor if the behaviour which led to the donor’s reputation being tarnished has clearly ceased.” Oxford also has many more specific guidelines in place; donations from those “actively working in the tobacco industry”, for example, are not accepted. Few donations towards institutions the world over will be found without their controversies; we must trust that it is in the interests of the university that they have both the integrity and common sense to make the sensible decision.
Back to the real issue, however – the cap. Cuts to higher education dominated last year’s press, with swathes of students protesting against the rise in university fees. Less attention, however, was paid to the reason behind these rises – that universities simply haven’t got the funds to sustain the vital service that they provide. The government’s proposal to curb tax breaks on charitable donations – which encompasses universities – is one of grave concern. The Vice-Chancellors of both Oxford and Cambridge have already written private letters to George Osborne urging him to reconsider his decision, highlighting the extent to which universities rely on large financial donations. The fact that the issue is being handled this far up the ladder at the two leading universities in the UK is a reflection of the gravity of this issue. Of course, the government’s proposals are there for a reason – charitable giving is an effective form of tax avoidance for the wealthy – another issue popular in the current media with the likes of Jimmy Carr’s tax arrangements recently in the spotlight – but it doesn’t mean that this is the right way to go. In the long term, sufficient university funding and development is what will matter to the UK – without it, economic growth will stagnate, and for what reason? For a few rotten-but-incredibly-rich scoundrels to stop avoiding tax by donating to charity, only to use their personally hired accountants to exploit another tax loophole? If it’s not through charitable gifts, there will be new ways found – mark my word.
The culture of university philanthropy and the simple fact that universities now rely on charitable donations far outweighs the need to stop tax avoidance through this one avenue. If it were a trade-off between the two, I know which choice I’d make.
