THE University of Edinburgh is opening a redundancy process for staff as a result of Labour tax hikes.
In an email sent to staff seen by The National, the university said that the National Insurance hikes in the Budget have created a “multi-million pound increase to our salary bill”.
The letter to staff said that it would continue to use “the standard mechanisms at our disposal to manage staffing costs” and that this included “if unavoidable, compulsory redundancy”.
READ MORE: University of Edinburgh to lay off staff as result of Labour tax hikes
Student numbers are also down with the letter pointing out that there have been challenges around “international student recruitment, increasing staff costs since the pandemic” and “unsustainable levels of funding for Scottish and other UK students”.
The letter said: “We will work with our unions and managers to ensure that the actions we will be taking are communicated clearly and to help colleagues through the changes.
“I realise that this will be a difficult and unsettling messages. However, it is important that we are honest about the scale of the challenges that we need to address, the reasons behind the course of action that we are taking, and the impact that this will have on our operations and on everyone in this university.”
It added: “It is important to emphasise that our university remains a respected and capable organisation with the potential to continue to develop its world-leading research and teaching.
“Taking some tough decisions now will ensure that we retain this status into the future."
In the Budget at the end of October, Rachel Reeves (above) announced an increase in employers’ National Insurance contributions.
The Chancellor said rates will rise by 1.2 percentage points to 15% starting from April 2025 and a change in thresholds means employers will also start paying National Insurance contributions on staff earnings from £5000 instead of the current £9100 level.
In a statement to the media, principal and vie-chancellor Sir Peter Mathieson said: "Throughout this year, I have been frank about the severe financial challenges our university and the sector are facing.
"Today, Monday, November 18, I have issued an update to all colleagues on the latest developments in terms of our costs and income, and our plans to address these serious issues.
"The university costs £120m each month to run. In the context of the recent sector challenges around international student recruitment, increasing staff costs since the pandemic, and the unsustainable levels of funding for Scottish and other UK students, our outgoings are consistently higher than our income.
"In response to this situation and recent developments with regards to National Insurance, we have concluded that we need to take a series of actions, which will include selective voluntary and, if unavoidable, compulsory redundancies.
"We will be offering staff the opportunity to find out more through a variety of online and in-person meetings, and we will continue to work with our unions and managers to help colleagues through these changes.
"I don't underestimate how unsettling this news will be, however, it is important that I am honest about the scale of the challenge we have and transparent about the actions we need to take to address it."
The UK Government has been approached for comment.
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