Dundee University bosses quit after 'devastating' report into financial crisis

An independent report found Dundee University’s financial collapse was ‘self-inflicted’

The interim principal of Dundee University and two senior members of its governing body have quit in the wake of a “devastating” report into the financial crisis which has engulfed the institution.

Professor Shane O'Neill, who took over in December and was previously deputy vice chancellor, said he was “truly sorry” for the impact on staff and students as he announced his departure with a “heavy heart”.

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It came after an independent report found the failure of the university’s financial governance system was “self-inflicted and experienced multiple times and at multiple levels”.

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Dundee University | National World

It said failures were compounded by a “top-down, hierarchical and reportedly over-confident style of leadership and management, a lack of transparency and clarity in respect of financial data, the promulgation of a positive narrative around financial matters and a culture in which challenge was actively discouraged”.

Tricia Bey, acting chairwoman of the university court, and Carla Rossini, convenor of the finance and policy committee, who were both due to step down from court this summer, are now bringing this forward and leaving with immediate effect.

The investigation into the university’s finances was ordered after it announced there could be hundreds of job losses as it struggles to deal with a £35 million deficit. It was commissioned by the Scottish Funding Council, led by Prof Pamela Gillies and conducted by international professional services firm, BDO.

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A £22 million bailout for the university was announced by the Scottish Government in March.

In her foreword, Prof Gillies wrote: “The main causal factors of the financial failure uncovered by this investigation are largely specific to the University of Dundee.

“They include poor financial judgement, inadequate management and reporting, poor monitoring of the financial sustainability key performance indicator, lack of agility in responding to a fall in income by the university leadership and weak governance in relation to financial accountability by the court. Financial oversight was lacking when most needed.”

The report found members of the university executive group, which included the “triumvirate” of Prof O’Neill, former principal Prof Iain Gillespie and ex-chief operating officer Jim McGeorge, were found to have “failed” last year to “properly respond to the worsening situation” and disclose the looming crisis to other university officials.

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It said the root causes of the financial issues included the decline in overseas postgraduate students coming to the university and the growth agenda proposed by leaders. According to the report, the “credibility and accuracy” of reports given to senior leaders regarding the financial situation were “poor”.

It heard Prof Gillespie, who resigned at the end of last year, “frequently demonstrated hubris, or excessive pride in his role” and had an “overbearing leadership style” and a “dislike of potentially awkward confrontations or questioning”.

The report said: “A considerable proportion of submissions from individuals from across the spectrum of roles in the university covering professional, administrative and academic positions, commented on the way in which dissent, or challenge was routinely ‘shut down’, particularly by the principal [Prof Gillespie] who, we understand did not welcome difficult conversations.”

It said “few dared to speak truth to power”, adding: “Female members of staff in particular, reported being spoken over, sidelined or discussed in public as being obstructive if they attempted to be heard and there were reports that the university policy on dignity and fairness was not upheld in a number of instances.”

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Dr Ian Mair, deputy chair of the university court, said: "It is evident from the report that there have been clear failings in financial monitoring, management and governance.

"While there were significant external factors, which have affected the higher education sector across the UK to varying degrees, the university's response to these, and responsible management of our finances, has fallen well short of the standards that everyone should have expected."

He offered his “sincere apologies” to staff and students “for all of the anxiety and uncertainty this situation has caused”, adding: "You have all deserved better, and we can only work to make that the case from here on."

Dr Mair said the court hoped to make an interim appointment of a new principal in the coming days.

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Prof O'Neill said: “It is with a very heavy heart, having committed myself fully to the recovery process over these past months, that I have decided to step aside from my position and will be leaving the university.

“It is important that the university can move on and I recognise that this will be easier with new leadership.”

Education Secretary Jenny Gilruth said there were “serious questions” to be answered, pledging to give an update to Holyrood next week on the report and any future Government support.

“It is evident from the findings that there are serious questions which must be answered by the University of Dundee’s management team,” she said. “This is obviously a difficult time for the university but I welcome the decisive action which has been taken with the changes in leadership.

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“It is vital that we now move to a period of stability to ensure the institution can move forward and thrive into the future. The report recognises the vibrant community of committed staff and students – they remain our priority during this challenging period.

“Whilst the university is an autonomous institution which is ultimately responsible for decision-making around it’s day to day operations, the Scottish Government will do everything possible to secure a positive future for Dundee.”

Dundee-based Scottish Labour MSP Michael Marra said: “This devastating report lays bare the financial vandalism and appalling leadership that has tipped the city’s most important institution into an existential crisis.

“I am grateful to Prof Gillies for her work in uncovering the details of this scandal. She has been clear that this is an outstanding institution with committed, excellent staff doing world-leading work.

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“The report shows that the institution was failed catastrophically by a small group of executive leaders entirely out of their depth and cowed by a hubristic principal who brooked no dissent.

“Details of Iain Gillespie’s leadership style are deeply troubling - sidelining, speaking over or publicly criticising women in the university who dared to speak up.

“There were also clear failures of governance, with inaccurate reports which masked the true financial picture and public statements by the principal that were purposefully misleading.”

Scottish Conservative education spokesman Miles Briggs said: “This is a devastating report into the gross mismanagement that has existed for far too long at the University of Dundee.

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“In light of the damning findings it is welcome they have done the right thing and resigned from their roles instantly.

“Senior figures were told what they had to do to get Dundee University into a sustainable position but they repeatedly failed to act, and covered-up the true state of its financial position.”

Liberal Democrat MSP Willie Rennie said: “For such a fine educational institution, central to the economy of Dundee, Tayside and Fife, to have been exposed to such dreadful and inadequate leadership and governance is devastating.

“It is not an exaggeration to say that the staff and students have been betrayed. “The oppressive behaviour from the top together with inadequate reporting and governance from the court has led to this failure.

“It is right that the whole leadership team has now gone. We need a new, clear and competent leadership without delay so that the future of the University of Dundee can be secured.”

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