OUSU faces a staggering loss of £58,000, according to an interim financial report on the year ended, which was presented to council last week. The predicted loss would leave OUSU with debts of £39,000.
The loss, for the financial year ending July 2009, has been largely attributed to the underperformance of Oxford Student Services Limited (OSSL), a trading subsidiary of OUSU, which is responsible for services such as Freshers’ Fair, the Careers Handbook and The Oxford Student newspaper.
The size of the loss was completely unexpected. According to official reports, OUSU had been predicting a small surplus until May. OUSU President Stefan Baskerville was only alerted to the actual figures within the last two weeks.
Ben Britton, St Catherine’s College MCR co-president commented on the loss, “If OUSU wishes to gain respect and trust within this University, then they should learn to manage themselves and their interests better. This loss illustrates quite how incompetent the OUSU management really are in dealing with our money.”
The main reason suggested in the report for OSSL’s deficit is the subsidiary’s lower-than-expected performance in raising advertising revenue. Although OUSU predicted a revenue of £65k, only £39k was actually raised. The report notes, “This may have been caused by over optimistic budgeting expectations, changes in personnel selling the advertising, a change in the economic climate or a combination of all of these factors.”
In response to the ongoing criticism of the Students’ Union financial structure, the new sabbatical team has vowed to produce a monthly financial report on OSSL’s activities. This will include detailed publishing of income and expenditure of OSSL’s main activities, including The Oxford Student newspaper. Up until now, there was no attribution of space cost and some staff time between OUSU and OSSL. This has resulted in skewed financial reporting on OSSL’s profit performance. An October JCCSM paper has pointed out the need to reform these reports.
Furthermore, OUSU will conduct an internal review of the existence of OSSL by the end of the academic year. In the report they will consider which OSSL activities could be transferred to OUSU, as well as deliberating on any
other changes that might be prudent.
However, some will argue that these changes do not to go far enough in increasing financial transparency.
Some of OSSL’s activities are suspected of making losses if attributed for space and staff time. However, no figures are currently available which break down in detail the finances of OSSL’s services and publications.
Baskerville defended the information OSSL was keeping under-wraps, arguing that revealing the details of certain contracts will make it more difficult for OSSL to negotiate with companies in the future. He said, “That could have a significant and negative impact upon the revenues OSSL is able to generate, which serve to fund OUSU’s work for students.”
OUSU is also considering restructuring the management of its activities to reduce their financial losses. In a debate scheduled for 5th Week, OUSU will discuss a proposal that “as far as possible, all publications shall be published in OUSU,” and that each OUSU or OSSL publication should have a publication board consisting of General Manager, Publications and Media co-ordinator and the Editors of the publication.
The interim financial report also speculated that substantial changes in OUSU staff arrangements during the year have led to an overspend in staffing costs which will not be repeated in subsequent years. The report notes, “This will have amounted to £15k in the period under review.”
Another key problem was the need to write off and provide for £12k of bad debts.
OUSU’s indebtedness is a concern for the University, which currently makes up the bulk of OUSU’s funding.
Professor Tim Softley, the chair of the Joint Committee of Council with Student Members refused to comment on the issue until further discussions are made by the University.
OUSU has assured students that the loss will not result in a cut in services, though the budget will have to be revisited and amended. An OUSU source predicts that the Students’ Union will lose money at the end of this year, calling into question OUSU’s ability to be financially responsible.
In response to the revelations, the OUSU team is seeking to assure students that the creation of a Budget Committee will result in greater scrutiny, so such problems can be tackled earlier in the year.
However, the establishment of this committee, alongside several others, has been delayed to Hilary term due to lack of communication between OUSU and University authorities. In a Cherwell report on the issue, Stefan Baskerville likened the situation of sorting out the committees to trying to deal with victims of a “car crash”.
Despite promises of heightened scrutiny, many at OUSU consider the problems to be more fundamental, and believe that OUSU needs a completely new funding structure. Baskerville has proposed that more funding be sourced from colleges. However, attempts to pass a similar proposal by the JCCSM working group through the University bursars failed in Trinity last year.
A problem complicating the funding reform debate is that there are legal issues surrounding OUSU’s aims to achieve a registered charity status.
