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Junior members' accommodation charges

Report of the Resources and Charges Working Group of the Bursar's Committee (January 1997)

Executive summary

The Report was prepared for the Bursar's Committee in response to a request by the Colleges' Committee that student rents should be examined with a view to eliminating any subsidy. The Colleges' Committee asked that the arrangements within Colleges for alleviating financial hardship should also form part of the review.

Subsidy is defined in the Report as the percentage by which existing rents would need to increase in order to equate to economic rent. The Working Group rejected the notion that College rents should automatically incorporate an element of subsidy.

The Working Group sought information to measure existing College rents against:

  • the running costs of providing student accommodation
  • the rents charged to students in other universities
  • market rents for equivalent private sector accommodation in Cambridge

The Working Group developed its own methodology for assessing running costs. All Colleges participated in the assessment which calculated the average subsidy at 46%.

A survey of rents at other universities was conducted, with replies from nine institutions. The Working Group also had access to the 1996/97 NUS survey of accommodation costs in 80 universities. The average Cambridge College rent of £36.39 was in the lowest quarter of accommodation costs nationally, and was significantly below comparable local charges. The NUS survey showed average rens of £53.11 for London, £44.89 for the South-east, and £41.89 for East Anglia, while the average rent for students at Anglia Polytechnic University was £48.00. Weekly rents hide the fact that students nationally are required to pay rent on average for 36 weeks each year, against 30 in Cambridge, spending a significantly higher proportion of their income on accommodation than their counterparts in Cambridge Colleges.

Comparing College rents with market rents, the Working Group updates the report prepared by Bidwells in 1992/93 and conducted its own survey of rooms available for private letting within easy distance of the centre of Cambridge. Bidwell's figures suggest that College rents are barely above half the market rent for comparable rooms. The Working Group's survey indicated that an increase of 53% to around £57 per week would be needed to eliminate the difference.

The Working Group conducted an inital survey of the student support funds provided by Colleges. However, it questions the premise that raising room rents to economic levels woul ddeter students of academic merit from applying for admissions to Cambridge.

The Report concludes: The evidence is overwhelming that, despite some catch-up in recent years, the room rents typically charged by Cambridge Colleges to their junior members still include a substantial element of subsidy (and are markedly lower than in most other universities, including Oxford). This conclusion, albeit to a differing extent, emerges from from each of the measurement approaches taken by the Working Group. The Working Group ... believes its report - suggesting the need for increases of between 45 percent and 60 percent - provides an adequate basis for future dicussion of rents by Bursars and Colleges.

The working party recongnises that colleges will in many cases wish to continue with the agreed consultative processes they have in place with their students, including a number of existing multiyear rent agreements. It has therefore framed its recommendations, as they apply to individual colleges, with sufficient flexibility to enable colleges to pursue different approaches to the elimination of their subsidy, but it believes that all colleges should commit themselves to bringing their average rent withing the targeted range by 2004/2005. A schedule of minimum, maximum and mid-range increases to achieve this, showing the position college by college is attached as Schedule 3

The working group views with particular concern the wide spread that currently exists between the colleges with the highest and lowest average undergraduate rents. In 1998/99 the spread is £13.60 per week, with the highest average rent at £48.60 and the lowest at £35.00. While the colleges concerned may have well-established internal rent-fixing procedures that command the confidence of fellows and students, the working group believes there is a wider interest to be consulted. This applies particularly to colleges with low rents, who are recommended, for the general benefit, to take steps to ensure that the rent spread does not widen further in money terms, implying a narrowing in percentage terms. In arguing for such a narrowing, the working group has in mind not only the possible impact of low rents on the rent negotiations of other colleges, but their potential influence on admissions applications, and on perceptions of the collegiate university by politicians, old members (particularly those solicited for funds), the press and the public.

To have realistic prospects of attaining the targeted range in 6 years, the working group believes each college should increase its rent in 1999/2000 by an amount not less than the minimum annual increase for the colleges shown in schedule 3 (unless committed by an existing agreement).

To ensure progress towards the elimination of subsidies by 2004/2005, the working party recommends that college rents continue to be monitored and that schedule 3 be updated each year to show the minimum annual increase needed over the remaining period by each college if the target is to be achieved.

Summary of recommendations

That a subcommittee of the Bursars' Committee be set up to provide information to bursars on economic and market rents on an ongoing basis.

That colleges raise their average rent to bring it inside the range of economic rents within 6 years.

That colleges with low rents seek to ensure that there is no futher increase in money terms in the gap between their rents and those of colleges with the highest rents.

That all colleges, unless constrained by an existing agreement with junior members, seek to implement in 1999/2000 not less than the minimum increase recommended for their college by the working party.

That progress towards the elimination of rent subsidies be monitored over the next 6 years, and the college-by-college table of target rent increases be revised and recirculated each year.