OXFORD UNIVERSITY is to capitalise on the financial success of Oxford University Press (OUP) by taking £87 million from its publishing arm over the next three years.
The money is to be used for capital projects, such as a new chemistry faculty and renovation work at the Bodleian Library. It will also boost the bursary system so that Oxford can attract top class post-graduate students who might otherwise be tempted by American universities.
The university is to take £60 million from the Delegates' Property and Reserve Fund, a pool of investment estimated to be worth £130 million. It has been built up over the past 15 years from the OUP's profits. The £60 million will be paid in two tranches over the next two years and will be set aside for capital projects.
The fund was originally created because of fears about the financial future of the OUP at a time of cuts in university funding. However, in the past decade the publisher has more than doubled its annual turnover to about £280 million and under Henry Reece, its new secretary, which is the name given to the OUP's chief executive, it has been set a target of making profits of at least 10 per cent on sales.
The annual dividend that the OUP pays to the university has also been increased. It will pay £9 million a year over the next three years - £9 million more than had originally heen planned. The extra £3 million a year will go towards paying endowments io attract top research students to Oxford. The university has been concerned that it is losing out to US colleges, such as Harvard and Stanford which have endowment funds much larger than Oxford's. A proposal to form a financial aid fund for top post-graduate students will shortly be proposed by Colin Lucas, Oxford's vice-chancellor.
The turnaround at the OUP has come as the publisher has recruited professional managers to replace the academics who used to run the business. Though much of the groundwork was done by George Richardson, an economics don, and Sir Roger Elliott, a physics professor. The OUP has been run for the past six years by James Arnold-Baker, who came from BBC Enterprises, and Mr Reece, formerly an executive at Pearson. The OUP now boasts that it is the largest academic publisher in the US and has recently moved into online publishing with a new version of the Shorter Oxford Dictionary.
Following a subsequent article in Cherwell 25/2/00, I telephoned the Oxford University Public Relations Office to clarify the status of this "generous donation" and was informed by its Director Helen Carasso that the £60 million, in two annual tranches of £30 million, was not actually a donation at all, but rather an underwriting of the two projects necessary to ensure their initiation. Once the projects were underway, other funds would most likely be raised. In the case of the chemistry faculty an alternative £30 million had by then already been raised, and soon afterwards Bodley's supposed restoration project was exposed as a sham by reports in The Oxford Times and The Observer (9/3/01, 16/3/01, 18/3/01). The admission that these claimed "donations" were, after all, "unallocated" - i.e. bogus - was subsequently made publicly by university spokeswoman Philippa Corson in The Oxford Times. The above Times announcement was therefore just a PR concoction to quieten the finger-waggers, and the "generous £60 million" will presumably after all find its subtle Oxford way back into the OUP's 'Property and Reserve Fund' war chest. Presumably also, new OED definitions will now be required of words like 'generous', 'charity' and 'donation'.
Click for a response letter from Vivien Noakes.
Click for the next item in Oxford's 1999 poetry fiasco (Times Business section leader comment).