The University of Bolton has warned that it faces “imminent financial and sustainability risks” meaning it must save £5 million a year, with alternatives including “takeover by another university” and downsizing.

But some staff have raised questions about the cost of the university’s campus in the Gulf and its halted plans for Blu U, a private UK subsidiary, which they believe may have contributed to the financial problems.

Bolton put forward plans for 92 redundancies, just under 15 per cent of its workforce. It now expects there to be between 70 and 80 redundancies.

An internal document circulated to staff by senior university management said the plan was driven by “the need to maintain both the short-term solvency of the university and its long-term sustainability”.

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A questionnaire seeking staff feedback on the proposals asked: “Given the imminent financial and sustainability risks, do you think the university should delay the implementation of [the] cost reduction plan?”

Another question asked: “Which of the following strategic alternatives is preferable to address the current scenario?” The options listed were “Cost-saving exercise (as proposed)”; “Takeover by another university (and downsized appropriately by that university)”; “Do nothing and wait”; and “Other strategic alternative(s)” - for which staff were asked to “please specify”.

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However, Martyn Moss, regional University and College Union official, highlighted the issue of Bolton’s campus in Ras al Khaimah, United Arab Emirates, which opened in 2008. “UCU and Unison have sought full financial disclosure from the university of the costs and, we believe, losses incurred by RAK, but they have so far declined to provide the information,” he said.

“Many of our members believe this is the major reason the institution is in such financial difficulties.”

Staff have also questioned the cost of the university’s halted plans to establish a private, low-fee college near Leeds, called Blu U.

It is thought that the university discussed the Blu U venture with senior figures in the government, and that the plans could be revived in future at an alternative location.

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A Bolton spokesman said: “In spite of some very positive indications from the government, ultimately the ����Vlog Funding Council for England decided not to allow us to bid for [Blu U] student numbers in the 2011-12 [and 2012-13] recruitment cycle and consequently the project has been put on ice.

“The main cost to the university was the time spent by the project team in bringing forward the proposal, which was not material - significantly less than £50,000.”

The spokesman said that the Gulf campus “was funded by a commercial partner in the UAE and the facilities are provided at low cost by the (state’s) ruling family. The campus has generated additional income for the university and is forecast to generate a surplus this year.”

On general finances, the spokesman said: “There is general concern in the sector that the destabilising effect of the government’s introduction of radically higher fees on student recruitment may continue for up to another two years.

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“We have therefore taken early action to secure the university’s financial position and thereby protect the long-term stability of the university and the vast majority of jobs.”

Hefce has “recognised our plans as being appropriate and confirmed that they considered us as one of the universities not at higher risk”, he added.

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john.morgan@tsleducation.com.