Planning and Finance

The University generated a surplus for the year of £52.3 million (2010/11 £15.4 million). Income growth has accelerated in 2011/12 with total income reaching £1billion for the first time; however, the upward pressure on costs and the need to invest for the future continue to be significant. Whilst the University generated a surplus for 2011/12 of £52.3 million, at 5% of income, this is not sufficient to maintain the long-term sustainability of the University. The net surplus is calculated after a reduction in the impairment of the University’s deposits with Icelandic banks of £0.8 million (2011: £8.1 million) and accounting for the transfer from expendable endowments of £7.9 million.

	2011/12 £M	2010/11 £M
Income	1,016	920
Expenditure	(972)	(914)
Surplus on ordinary activities	44	6
Transfer from expendable endowments	8	9
Surplus for the year retained within general reserves	52	15

Year-on-year income

Compared with the previous year, income to the University rose by 10.5%, from £919.6 million to £1,016.1 million. Research grants and contracts continue to be the largest source of income to the University and increased by 8.6% to £409 million, most of which was matched by related expenditure. Grants from the Higher Education Funding Council for England (HEFCE) represent the second largest source of University income and amounted to £203.6 million, up by 1.6%. Academic fees and support grants totalled £173.3 million, up by 13.5% as a result of increased fee levels and student numbers. Donation income for current use increased from £23 million in 2010/11 to £26.3 million in 2011/12. Donations received during the year for capital projects and endowments, two of the main priorities of the Oxford Thinking Campaign, are for capital purposes and are not part of donation income; these totalled £40.5 million. Endowment and investment income increased by 17.3% to £36.7 million. The main reason for the increase was inclusion of a full year’s investment income arising from an endowment of £203.5 million from Oxford University Press, received in mid-year 2010/11.

The University’s expenditure of £971.8 million was 7% higher than in 2010/11. Staff costs totalled £499.1 million, an increase of 4.1%. This resulted from an annual negotiated pay settlement of 0.4%, annual promotional salary increments, and a 4.3% increase in the average number of staff, offset by a reduction in early retirement charges. Other operating expenses amounted to £415.7 million, an increase of 9%. The largest component of the increase related to externally funded research grants and contracts. Depreciation has increased from £53.3 million in 2010/11 to £55.8 million in 2011/12, mainly due to fixed asset additions during the year.

Cash flow

The increase in surplus for the year led to an increase in net cash flow from operating activities of £34.6 million. Capital expenditure of £139.2 million is up from £103.8 million in 2010/11. After the net cash impact of investment activities of £87.6 million, the increase in cash for the year was £42.3 million.

Balance Sheet

	2011/12 £M	2010/11 £M
Fixed Assets	1,468	1,376
Endowment assets	854	856
Net creditors	(117)	(110)
Net assets	2,205	2,122

The balance sheet position remains strong, with net assets at 31 July 2012 of £2.2 billion, up £86 million on the prior year position of £2.1 billion. Tangible fixed asset cost increased by £91 million, reflecting the continued building programme to support the University’s expanding research base. Projects achieving completion in the current year include Phase 2 of the Saïd Business School for Executive Education, refurbishment of the Ashmolean Museum Egyptian Galleries, the provision of executive accommodation for the Department of Continuing Education, and the Oxford Centre for Functional MRI of the Brain at the John Radcliffe Hospital, enabling installation of new 3T and 7T magnets, providing the most advanced research facilities of their kind.

The University will continue to seek to manage its sources of revenue effectively and its costs efficiently, in order to generate the positive long-term cash flow needed to ensure that Oxford maintains its pre-eminent position amongst the world’s leading universities.

The University is committed to disciplinary excellence in research across the spectrum of the sciences, medicine, the social sciences and the humanities, and to interdisciplinary research initiatives; its ambitions, activities, global connections and reach are influenced by more than eight centuries of discovery and public engagement.

Much of this activity and its impact in intellectual, social, cultural and economic terms depends on external funding.

Despite tough economic conditions, in 2011–12 Oxford’s researchers attracted a record £541 million of financial awards (grants and contracts). UK charities were the single largest source of these awards, not only from the largest funders such as the Wellcome Trust, Cancer Research UK, the British Heart Foundation and the Leverhulme Trust, but also from a large number of smaller charities.

Research Council funding remains extremely important in facilitating a wide range of projects, major research programmes and interdisciplinary initiatives, research training and international collaboration. All seven of the Research Councils rank in the top 25 of Oxford’s sponsors by award value, with the Medical Research Council (MRC) and the Engineering and Physical Sciences Research Council (EPSRC) in the top four.

The other major sources include the Department of Health (DoH), the National Institutes of Health Research (NIHR) and the European Commission (the UK as a whole has received EUR 3.7 billion from Framework Programme 7 (FP7) P7 in 2007–11, second in share only to Germany).

The University warmly acknowledges the role of all its funders in supporting its research efforts, and the significant contributions made by its collaborators; both are central to the generation of public benefit through the University’s research activity.

Environmental sustainability remains an important consideration for the University, and throughout the past few years Oxford has implemented a wide range of activities aimed at reducing the environmental impact of its departments and colleges.

Travel and carbon emissions

During 2011–12, 95% of the University’s total travel carbon (CO₂) emissions were from business air travel, which forms 7% of its total CO₂ emissions. The remaining 5% of travel emissions were from University-owned fleet vehicles. Business air travel emissions increased from 6,981 tonnes CO₂ to 7,226 tonnes CO₂ – up 3.5% compared to last year. Air travel emissions are measured according to the number of trips logged in the University insurance records, so the increase could be due to more reporting of trips, or an increase in the number of trips made. Currently, data on other business travel (train, car hire, staff and student commuting) is not recorded centrally. However, during the forthcoming year the University will be exploring how more travel data can be captured for next year’s reporting.

Business road travel

University fleet vehicle emissions decreased from 412 tCO₂ to 401 tCO₂ (down 3%) due to a reduction in the number of fleet vehicles (112 compared to 115 the previous year).

Data for business air travel:
2008–09: emissions were 5,826 tonnes CO₂
2009–10: 6,199 tonnes CO₂ (increase from 5,826 tonnes CO₂)
– up 0.2%)
2010–11: 6,981 tonnes CO₂ (increase from 6,199 tonnes CO₂)
– up 13%)
2011–12: 7,226 tonnes CO₂ (increase from 6,981 tonnes CO₂)
– up 3.5%)

Sustainable travel initiatives

Staff and students are encouraged to use sustainable travel options such as cycling, travelling by train instead of plane, walking and public transport. In support of this, there are a number of staff benefit and sustainable travel schemes now in operation, which include:

• a business travel toolkit which provides advice to help staff choose the most appropriate business travel mode, as well as alternatives including use of the University’s videoconferencing facilities
• the Journey Share car sharing scheme (76 staff members registered this year, bringing the total number registered to 251)
• 5–8% staff discount on annual season tickets for train travel

In addition to the above, there were also various activities to encourage more cycle use, including:
272 more cycle parking facilities at five major locations, a ‘mobile mechanic’ free cycle repair service and the establishment of five safe-cycling workshops provided free of charge to both staff and students.

A five-yearly travel survey was sent to all departments; 9,000 staff and students responded. The information gathered will help the University shape its new Travel Plan and give sustainable travel support to staff and students.

Sustainable buildings

The University aims to achieve a BREEAM^* Excellent rating for all new buildings and major refurbishments costing more than £1 million. The New Radcliffe House building, which was completed this year, achieved a rating of Excellent. Three other buildings currently under construction – the Kennedy Institute, the Nuffield Department of Medicine and the New Mathematics Institute – are all on course to achieve BREEAM Excellent ratings.

Four University buildings have rainwater harvesting systems and the University has developed its Sustainable Buildings Philosophy (SBP) document, which provides detailed guidance to project managers, clients and project sponsors on how to improve the sustainability outcomes for new buildings at each stage of a project. The new Blavatnik School of Government building is currently piloting the SBP.

Water use

Total University mains water consumption fell 8.2% during the year, saving the equivalent of nearly 29 million litre-bottles of tap water! This decrease was achieved by implementing the first year of the University’s Water Management Strategy. This included upgrading equipment in departments and ongoing washroom refurbishment by Estates Services. Indirect carbon emissions^** from water consumption also fell 8.2%, making up 0.4% of the University’s total CO₂ emissions.

Rainwater

The four buildings with rainwater harvesting systems used for flushing toilets consumed a total of 1,269m³ of rainwater (0.4% of total water consumed in the University). Biochemistry decreased rainwater use to 204m³ (2.2% of the building’s water use) compared to 837m³ (8.6% of the building’s water) last year. The Old Road Campus Research Building increased rainwater use to 638m³ (4.3% of the building’s water use) from 400m³ (2.8% of the building’s water) last year. The Oxford Molecular Pathology Institute used 372m³ of rainwater and Earth Sciences used 55m³ of rainwater (3.2% of the building’s water use).

*Building Research Establishment Environmental Assessment Method
**Due to the energy used for abstraction, processing and transportation of mains water. Calculated using Thames Water metric for indirect tCO₂ emissions for mains water

Material resources

The University reused a total 8,010 tonnes of good-quality items through in-house schemes (Swap Shop, Lab Swap and Plant Swap), compared to 9,381 tonnes last year. This saved £44,627 of income by not buying new items, compared to £37,157 last year. The University recycled 3,009 tonnes of printer cartridges compared to 1,717 tonnes last year and 46,648 tonnes of shredded confidential paper. Colleges and departments collectively recycled 2,015 tonnes of textiles. In addition, the University decreased its general office waste by 42 tonnes. Of this, 543 tonnes was recycled compared to 594 tonnes last year and 1,802 tonnes was landfilled compared to 1,793 tonnes last year.