UCC forced to review all capital project spending after recording €11.2m deficit
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University College Cork has been forced to review all of its capital spending projects after recording an €11.2m deficit for the last financial year.
The news has cast doubt on the delivery timelines attached to some of its large-scale projects, including its proposed €106m-plus city centre campus on a long-time vacant site in the heart of Cork city centre.
In 2019, UCC secured some €25m from the Higher Education Strategic Infrastructure Fund (HESIF) to help develop the Cork University Business School (CUBS) on the long-vacant former Brooks Haughton timber yard site — between Copley Street and South Terrace.
The project was costed almost two years ago at around €106m.
Planning was granted last April for the demolition of the existing buildings on the site to make way for a new six-storey building to house CUBS. It is expected that the new building will accommodate up to 4,500 students and 225 staff, acting as a significant catalyst for the rejuvenation of the city centre.
The university has described this project as a landmark development which will “position CUBS at the heart of the business district, enhancing the social and economic fabric of the city and region”.
However, the has learned that spending on large capital spending projects such as CUBS is now under review following the publication of its financial statement for 2022-23.
In a statement on Monday, UCC confirmed that it has identified a financial deficit in its 2022 to 2023 accounts of €11.2m.
A spokesman said it represents just 2.4% of overall income.
“Strong income growth of 5% was offset by cost growth of 8%,” he said.
“The Higher Education Authority (HEA) has been notified. UCC has initiated a plan to address the deficit.
“UCC and the HEA have agreed to review capital projects in the context of the current work plan.
“The fundamentals of UCC remain strong and the university is committed to returning to a surplus position.”
The HEA confirmed that the deficit was reported to it in December and that it is working with UCC to address the issue.
“Following discussions, it was agreed that the university will provide a detailed report on matters relating to this deficit and a clear plan setting out the actions to position the university onto a clear trajectory of financial stability,” a spokesperson said.
“In addition, capital projects have been temporarily paused to allow UCC and the HEA to agree a process for the review of capital projects.
“The HEA are actively engaging with UCC on these matters.”
The university briefed staff on the issue on Monday afternoon following queries from the .
In its briefing, UCC president Prof John O’Halloran said the university leadership team has put in place a comprehensive plan named Project Alpha to identify immediate measures necessary to address the financial position and ensure a sustainable approach to university finances, including the achievement of a surplus position.
“UCC consistently shows strong income growth and the fundamentals of UCC remain strong,” he said.
“Our strategic plan remains our ‘north star’ and we remain committed to its full implementation.”
A town hall-style briefing is due to take place next week and Prof O’Halloran said he hopes to provide staff with further information at that stage.
Fine Gael TD Colm Burke, a member of the Oireachtas public accounts committee and a former member of the UCC board of governors, expressed concern at the deficit.
“UCC provides top class education for a large number of students, from Cork, across Munster, and internationally, and it’s very important that the provision of that educational isn’t affected by this deficit,” he said.
"It is vital that students don’t suffer as a result of this."