Universities in talks to outsource services

Two universities are negotiating deals to outsource their services to private companies, in what could be a new model for higher education.

Unions have reacted angrily and threatened to take industrial action to stop the proposed deals, which they claim amount to privatisation.

In one case, London Metropolitan University (LMU) is in discussions with three private companies which could lead to the take-over of the bulk of its services. One of the three firms is an IT company based in Bangalore in India, the investigative news website Exaro revealed yesterday.

Professor Malcolm Gillies, vice-chancellor of LMU, said he was optimistic that a deal could lead to several London higher education institutions benefiting from shared services. He said the university was seeking to reduce its in-house support staff by as much as 40 to 50 per cent. He added that "a lot of universities" were considering how they could do the same. "There may be some staff losses and some staff gains," he said, "but if you run it into shared services, you grow a business."

LMU insists it would simply be paying an operating fee to the selected company which would have "zero ownership" of the business.

Sussex University is also seeking to put some of its services – catering and land estates – into the hands of a private company.

John Duffy, registrar and secretary, said: "As we grow we need to ensure we provide support services to our students and staff as efficiently and effectively as possible."