Funding for universities 'wasted' on consultants

Academics are demanding an investigation into a government scheme to retain and recruit staff after discovering that less than a third of the £50m earmarked found its way into lecturers' pay packets and up to £10.5m was spent on work by consultants.

The Association of University Teachers is writing to the National Audit Office to demand an inquiry, complaining that cash was "squandered" on work such as examining staffing levels, which actually resulted in jobs being lost.

A breakdown of the way the money was spent showed that 30 per cent, or £15m, went on recruiting and retaining staff. A similar amount was spent on staff development and training. Twelve per cent was spent on reviewing university staffing levels and nine per cent on job evaluation – both of which, the union says, involved hiring consultants to do the work.

Malcolm Keight, the union's assistant general secretary, said: "It's astonishing that more than two thirds of the sum originally earmarked to boost pay should be spent on consultants and other non-salary exercises. It's clear from feedback we're getting from our members that dissatisfaction with pay is a key issue within the higher education sector. This scheme provided vice-chancellors with a clear opportunity to make things better.

"It's now time for the National Audit Office to take a look at the spending of this money which, after all, is coming from the public purse."

The scheme, which will continue until 2005-06, was launched by David Blunkett in 2000, when he was Education Secretary. Mr Blunkett said the money was for academic and support staff pay. He added that it should be used to recruit and retain high-quality academic staff and modernise the profession. The union argues that far more of the cash went into measures to see how staffing levels could be streamlined than went into retaining top-quality staff.

The money was given by the Government to the Higher Education Funding Council for England to distribute to universities. In all, £837m has been earmarked for the scheme to be spent by 2006.

The union estimates that, if spending patterns continue in the same vein, only £251m will find its way into lecturers' pay packets. The funding council insists it is "confident that the funding is being allocated according to its original purpose". A spokesman said that Mr Blunkett "had explicitly stated that the additional funding would be a 'something for something' reform to help institutions to recruit and retain the key staff they need to improve further the quality of teaching and learning and help modernise management and reward systems".

A breakdown of the spending, taken from an evaluation of the scheme by the funding council, also shows that not all of the money earmarked for recruitment and retention went on pay. Some was set aside for initiatives such as introducing flexitime working, waiving student fees, health insurance costs and workplace nursery places for the children of lecturers.

A spokesman for the funding council said the intention had never been to spend the entire amount on lecturers' salaries. Mr Blunkett's remit made clear that it should be used to modernise management as well.

A spokesman for the National Audit Office said the union's complaint would be considered once its letter had been received.