Members of the University’s governing body has defended the 5.8% price rise in graduate rent at an Oxford SU meeting.
Pro-Vice Chancellor for Planning and Resources, Dr David Prout, was asked whether he was concerned about possible student dropouts due to the increase in fees. Prout said: “A balance has to be struck. A line is drawn, and somehow people make choices.”
According to Head of Estates Finance, Sarah Davies, the 5.8% rent increase will generate £90,000 per unit in the next five years. She later clarified that this sum will not fully account for the costs of refurbishment and replacement, and that the University will cover the difference. Prout stressed the need for financial sustainability throughout the meeting. He said: “The University needs to balance a whole range of demands. We must consider how we ought to fund the University’s long term preeminent research achievements.We have to think about the long term enterprise. We can’t support it if we’re not breaking even.”
Oxford SU’s VP for charities and communities, Tom Barringer, who attended the meeting told Cherwell: “It is a great shame that students could not be consulted about this 5.8% increase beforehand, since the decision was made behind closed doors. It is strange that a university with a £1.3 billion budget seems so keen to isolate its graduate accommodation department and charge ‘sustainable rent’ – also known as passing on all building costs, including their construction, directly to students.”
The Property Management Sub Committee, which determines graduate accommodation rent, came to the 5.8% figure based on the Retail Price Index plus 1.8%. The committee also imposed a collar on the increase of 3.5% and a cap of 5.5%. The collar and cap will only come into effect next year, after the 5.8% increase, an SU rep told Cherwell. Sarah Davies opened the meeting by explaining the grounds for the rent hike. She said: “The University asked if graduate accommodation was sustainable. We investigated and found that refurbishments were needed, but reserves were depleted.”
Davies explained that accommodation funding is ‘ring fenced’, meaning no funds can be withdrawn or added. If accommodation needs more budget, they would have to borrow money. “An inability to cover the costs limits our ability to replace and reinvest.”
Davies added that accommodation would need to recover £7.2 million per year to fund refurbishments over the next five years. She broke this figure down to £3 million for running costs and utilities, and £4.2 million for ‘capital costs’ – meaning refurbishments and replacements. A standard single room en suite in the Castle Mill complex currently costs £591 per calendar month (pcm).
Following the hike, rents for the same room will rise to £625 pcm. Davies explained that the University uses college-owned accommodation prices as a benchmark. Balliol College charges £609 pcm for B and C graduate rooms, while St John’s College charges £513.3 per month for a grade B room, plus a termly charge of £214 for ‘the general provision of services’.
The rent hike will only affect central University housing, likely creating greater demand for the limited college accommodation available to graduates. During the 2016-17 academic year, 57% of all full-time graduate students and 70% of full-time graduate freshers were housed either by the University or in colleges.
Cherwell asked for a transcript of the meeting but the request was refused. A separate request to film the meeting was also denied.