Mottley to lead UWI team looking at loss drivers

The University of the West Indies (UWI) has established a subcommittee to examine the forces outside of its control, which sometimes affect its balance sheet.

Vice Chancellor Professor Sir Hilary Beckles said rising government debt, impairments and post-employment benefits are three of the major systemic deficit drivers.

Up to July 2021, there was US$51.3 million in government debt owing to the regional university.

“We have no control over that, but, when it rises and our auditors take the next step, which is to impair that ageing debt, we get hit twice – the debt and then the impairment,” Beckles said in his report on the 2020-2021 academic year, during the opening segment of the meeting of the University Council on Friday.

Beckles said The UWI has a rich and diverse commitment for public investment, but it has had to carry responsibility for an unfunded pension liability.

“These three issues cascade into a cocktail that, from time to time, adversely affects our balance sheet, and we are looking forward to the day when we can have a reform to enable us to manage these three issues separately, effectively, and, of course, within the rules of accounting,” Beckles said.

He thanked the finance minister of Trinidad and Tobago, Colm Imbert, for agreeing to establish a subcommittee, under the leadership of Barbados Prime Minister Mia Mottley, to address the three issues.

“The work has started. The Mottley committee had invited Dr Dodridge Miller, president and CEO of Sagicor, to use his actuarial skills to examine the university’s pension systems – the cost and the structure,” the vice chancellor said.

Beckles added that Miller has made two submissions and the university can now see the “beginning of a new road map” – a way to handle the matter critically and creatively.

Meanwhile, the vice chancellor said there has been a reduction in government debt.

“The government debt in the year in review, 2020, is now at its lowest in many years. When I came into office as vice chancellor in 2015, 2014-2015 was the highest government receivable ever. This is what my team inherited on day one and, six years later, look at where we are. We brought this down from US$117 million down to US$48 million in the year in review,” he detailed.

Beckles said this was achieved through detailed and systematic work with all governments.

He also proposed a new funding model for the future, which would see governments contributing 50 per cent, 15 per cent from student fees, five per cent from alumni and 10 per cent each from UWI entrepreneurial activities, the private sector and international development partners.

The UWI’s current cost-sharing model is 80:20, with students paying tuition fees equivalent to 20 per cent of the cost of academic programmes.

judana.murphy@gleanerjm.com