The Oxbridge College Accounts: Recent History

In the first chapter of Making Names (1984), the book's two protagonists Andrew Cause, a philosopher, and Malcolm Effect, a scientist, discuss Gilbert Ryle's classic behaviourist text The Concept of Mind. In Ryle's famous 'category mistake' passage, a foreigner visiting Oxford is shown a number of colleges, libraries, playing fields, museums etc., and then asks "Yes, but where is the university?" At page 47 of MN Cause says: I cannot imagine a language which used the same word for 'me' and 'you'... No, a better parallel with the man who observes another's behaviour and then asks "Yes, but what is going on in his mind?" is the visitor who is shown around the university's colleges, libraries, laboratories and so on and then asks "Yes, but where does the money come from?"

For many years now the funding of the UK's higher education system has been hotly debated, with the elite 'Russell Group' of universities, and in particular the elite of the elite, Oxford and Cambridge, arguing simultaneously for increased government spending and greater independence from the State, in particular the freedom to set and charge their own fees. Meanwhile, there have been numerous signs that the Treasury, for its part, is finally losing patience with the two great universities and their limitless demands for money, tiresome protests of pre-eminence and implacable reluctance to modernise. At the heart of this paralysis is the two universities' ancient "federal" collegiate structure (or rather lack of structure) with, in Oxford, its consequent 40-fold multiplication of administrative costs and quagmire of policy-stalling committees.

In its 1997 election campaign New Labour's manifesto on higher education pledged, amongst other things, to scrap Oxbridge's government grant to the colleges (of roughly £2,000 per student per year, totalling roughly £35 million) dedicated to the preservation of the universities' unique but debatably valuable personal supervision systems. However, after fierce argument in the higher education press (click for the first in a linked series of articles), and a lot of special wheedling and pleading (a fine example), in November 1997 Tony Blair reneged on his election commitment and Oxbridge's 'special status' government grants were spared the axe.

However, Blair's cave-in came with a price tag: Oxbridge's extra 'college fee' was (a) to be phased out over ten years (now nearly up) and (b) to be paid centrally to the university under a new "single cheque" regime. The modernisers at the Treasury and the Higher Education Funding Council (Hefce) presumably hoped that the University would thereby exert pressure on its colleges and, for example, strengthen their 'College Contribution' system, whereby a proportion of the endowment income of the wealthier colleges is internally redistributed to the poorer ones.

The Oxbridge/Russell Group then focussed on New Labour's pledge not to introduce university 'top-up' fees, the first step towards privatisation and an American-style competitive free market in UK higher education. This long argument ended with the final tergiversation of our elected representatives on 27th January 2004, and within weeks of that further betrayal, as predicted, Oxford was reported to be intending to smash the £3,000 top-up 'cap' by charging fees of £10,000 a year, and increasingly public admissions were heard of Oxford's plans to recruit wealthy foreign students and postgraduates at double this figure and at the expense of the domestic student intake. The scrapping of the UK's egalitarian, meritocratic State higher education system and the reversion, in particular, of Oxford and Cambridge to the role of private, elite finishing schools had openly begun.

In the perpetual debate about Oxbridge's finances and battles to retain/regain their places amongst the front rank of the world's universities, their comparatively low central pay rates are often cited as the cause of their (particularly Oxford's) recent decline, but, as anyone in the game knows, the serious money in Oxford rests in the hands not of the University, but of its various colleges, from which it claims to be "wholly separate" (viz).

The two Universities, as they are obliged to, already publish their Central Fund accounts, which are available online at www.ox.ac.uk/aboutoxford/fs and www.admin.cam.ac.uk/reporter/2003-04/special/08. However, up until 1997, their colleges' accounts were opaque and largely inaccessible, despite their exempt charity status. Charities' accounts are normally open to annual inspection by the Charities Commission, and hence to public scrutiny, but for centuries details of the Oxbridge colleges' steadily accumulating wealth has been a jealously-guarded secret. Apart from the alleged fact that after the Crown and the Church they are the country's third-largest landowners, and the apocryphical claim that it was once possible to walk from one university to the other without straying onto non-college soil, little detail has publicly been available about the size of their private fortunes or about how efficiently their incomes from them are administered and allocated.

This anomalous, unaccountable, monumentally wasteful arrangement has in recent years become a target for reform, and successive governments have nervously toyed with new legislation. A first step was taken in 1997 when a new (the 1993) Charities Act became law, obliging the Oxbridge colleges for the first time to some measure of public disclosure. At Oxford from that year, each college had to submit to the University central office a set of audited accounts in a standard format devised by a committee chaired by Lord Franks, a format which includes a statement of each college's endowment income streams, but omits any valuation of its capital assets. These accounts (12 A4 pages for each of the 36 colleges), together with a summary of their figures, were then collated by the university and made available to personal applicants upon payment of £64. Cambridge produced a slimmer, cheaper version, but on a different pattern and without a summary.

To celebrate this change, in November 1997 The Sunday Times ran a major exposure of the Oxbridge Colleges' hidden wealth under the headlines "Oxbridge accounts reveal assets of £2 billion. The worth of some colleges equals that of Britain's best-known companies; total assets eclipse the GNP of some developing countries." The accounts issued by the universities give figures for the income received by each college from holdings of land, property, shares and so forth, but do not, of course, give details of what those holdings are or are worth. One hears casually that the colleges own City office blocks, provincial docks and shopping centres, and farmland all over the country, but without inside information (an interesting project for some red-brick business students?), it is impossible to verify the full extent of this wealth.

As a result, The Sunday Times had to infer figures of the colleges' likely asset values from their declared endowment incomes, assuming average rates of return. The reporters did not explain the basis of their estimates, but on it they drew up the following 'league table' of the richest ten colleges:

Cambridge Top Five	Income £m	Assets £m		Oxford Top Five	Income £m	Assets £m
Trinity	19	310		St John's	5.5	90
St John's	5.9	91		Christ Church	4.7	90
Jesus	2.9	51		All Souls	3	61
Gonville & Caius	3	91		New College	2.0	60
Peterhouse	1.9	30		Merton	2.8	56

Total income £47 million	Total income £51 million
Total assets about £800 million	Total assets about £1 billion

Since 1997, although Blair caved in over the withdrawal of Oxbridge's college fee, other reforms have been afoot which, it was hoped, would at least oblige the Oxbridge colleges to become financially more transparent and accountable. In 2002 the New Labour think-tank, the Policy and Innovation Unit (PIU), published a long-awaited paper on Charity Law reform entitled Private Action, Public Benefit recommending that the provision of 'public benefit' should become a new key criterion of charitable status, and that exempt, fee-charging educational charities like the Oxbridge colleges (and the public schools) would have to fulfil this condition if they wished to retain their exemption from corporation (and other) tax. This new 'public benefit' condition was written into the 2006 Charities Act, which will become law in 2008, and its interpretation is currently (in the Summer of 2007) the subject of a public consultation.

In 2003, as its contribution to this important national debate, Akme decided to obtain a copy of the then latest Oxford college accounts (for the year 2001/02, including the 2000/01 figures), convert them to html, and post them on this website, along with the colleges' Fellows lists (the Fellows are the equivalent of a charity's trustees) and various other information files. Cambridge's top five (Trinity, St John's, Gonville & Caius, Jesus and Emmanuel) were also added. Akme's equivalent of the Sunday Times' 'top ten' with commentary looked like this:

In 2004 new Hefce rules came into force obliging all higher education institutions to follow the Government's Statement of Recommended Practice (SORP) guidelines, under which the colleges were forced, for the first time, to include in their accounts statements of the capital values of their endowment assets. In July 2004, this resulted in a fresh flood of newspaper articles examining the colleges' wealth (see index below) and prompted Akme's posting of the first SORP accounts for 2002/03, this time as pdf scans. By this time Oxford was charging over £100 for its 600+ A4-page bound book, and often claiming it to be 'out of print'.

Obliging the colleges to declare their endowment asset values was certainly a breakthrough, but in other respects the new SORP accounting format revealed/reveals less than the preceding 'Franks' model. The earlier accounts listed each college's incomes from agricultural land, non-agricultural land, properties let on non-repairing terms, properties let on other terms, mineral rights, share dividends, interest etc.. In the new accounts there are just two valuation categories, Securities & cash and Land & property, with the annual income from both being lumped together in a single 'endowment' figure. This means that it is now harder to tell how well a particular college's endowment is performing, e.g. in respect of its stockmarket portfolio or its agricultural landholdings.

There were/are other striking omissions too. Many of the colleges are active in the buying and selling of land, property, equities and so forth, and although the figures for their purchases and sales during the year are entered under the note Endowment asset investments, the actual profits/losses on the sales are omitted, figures which in customary practice must be included, and which in normal commercial contexts carry serious tax implications. It may be that the SORP guidelines do not require such figures to be included, but then perhaps the guidelines do not envisage our higher education institutions operating like speculative property developers.

Along with the 2002/3 accounts, Akme's independent analyst Scout collated all the figures into a single MSExcel Endowment performance table, and posted his detailed assessment of the colleges' "generally lamentable" performance, noting that 25 of Oxford's 36 colleges showed a return of under 4%, that is less than the high street banks' deposit account rates. Scout's findings provoked a full-page article-cum-row in the Times Higher Education Supplement of 1st October.

In March 2005, for the first time in history, and with no public statement or press coverage, Oxford University posted its colleges' accounts (aggregates only) for the year 2003/4 online, together with a statement proclaiming the colleges' improved endowment performance. Asked if the university's move was in response to Akme's postings, a university spokesman said: "The timing of this is a pure coincidence. We would have been planning to do it anyway... I have never heard of this Akme, what is it?" Asked whether this first step heralded the future posting, following Akme, of all the college accounts, the spokesman was non-committal. "These matters are constantly under review," he said.

Also since 2005, and also arguably in response to Akme's postings, various Cambridge colleges (Churchill, Clare, Downing, Jesus, King's, Lucy Cavendish, Magdalene, Newnham, Pembroke, Queens', Robinson, Trinity)and just one Oxford one (New College) have at last started posting their accounts online themselves, something they obviously should have begun back in 1997.

In that same year Akme obtained the endowment income figures for all the Oxford colleges going back to the year 1973, and collated them together into a single large MSExcel file, posting them up in May 2005 (see press release), together with a series of analyses and graphs, revealing yet more startling anomalies and aberrant performances. Lately updated to include the 2005/6 figures, these reveal some quite fantastic disparities. Over the same 32-period, top-of-the-table Jesus has achieved a 28-fold increase in its endowmnent income, while bottom-of-the-table Pembroke has managed only five-fold. Another table shows the withering, if not complete collapse of the 'College Contribution' system, prompting predictable criticism in the Oxford student newspapers. For institutions supposedly dedicated to 'learning', the Oxford colleges are not proving to be very good at it.

Newspaper reports, post 1997 (sample, chronological)

Now click for THE OXBRIDGE COLLEGE ACCOUNTS INDEX