From 12 January 2021, hundreds of students at the University of Sussex will be joining a rent strike called by the Sussex Renters Union. Participating in a broader movement of UK University Rent Strikes, Sussex students announced on 1 December their intention to withhold their rent on University accommodation until their five demands are met. On 7 January the View from the VC announced that 'students who cannot live in their accommodation will not be charged rent during the period of lockdown.' But while welcome, this announcement does not address the broader picture and the three Sussex campus trade unions, under the banner of Crisis Justice Sussex, stand in solidarity with the student strikers.
In what follows, we provide the financial context and explain what motivates, and necessitates, this unprecedented mobilisation in student housing activism.
In Section One we look at University of Sussex on-campus student accommodation rents from 2010-2020 [1]. We show that when benchmarked against CPI, average on-campus [2] rents have increased from £123 pw in 2010 to £152 in 2020. We consider the impact of the systematic replacement of the most affordable types of student accommodation with the most expensive. We highlight the work of the University of Sussex Students’ Union (USSU) in supporting students by year-on-year lobbying and organising for more affordable accommodation.
In Section Two we consider the economic precarity faced by Sussex students in the context of erratic and dwindling financial loans, grants and scholarships along with decreasing opportunities for other sources of income. We consider the effect of the ongoing global pandemic on these income streams. In particular we discuss the removal in 2020 of both the First Generation Scholarship Scheme and the Sussex Excellence Scholarship which between them provided £50 per week of term-time rent to over 1,500 Sussex students a year.
In Section Three we look at how University income in real terms from student rents has risen steeply over the last years and at the known information about the 50-year Balfour Beatty contracts. We predict that these contracts will see 80% of rooms in 2021 costing more than the most expensive rooms available in 2010, adjusted for CPI. It becomes clear that students are suffering increasing financial hardship to drive University income and private profit.
In Section Four we consider the Sussex Rent Strikes. We propose the introduction of an affordable rent policy and a rent portfolio that addresses the historic systematic rise in rents. We highlight the need for progressive changes to the nature of student accommodation and the funding structure of universities. We applaud those in the University community who are actively addressing the student rent crisis.
We call on the University Executive Group (UEG) and Council to urgently listen to USSU representatives and the Sussex Renters Union and act on their calls to address the increasing rent inequality at Sussex University. We call for co-ordinated action on the systematic causes of this inequality.
1. On campus accommodation strategy since 2010
Every June the University of Sussex Council agrees the rent for on-campus accommodation as part of the broader on-campus accommodation strategy [3]. The rent levels are discussed with the University of Sussex Students’ Union (USSU) and papers show, for example from 2011 to 2019, that the same concerns are raised every year by USSU representatives.
Student representatives have continued to argue strongly that there should be a range of lower priced housing for those on restricted budgets and wishing to prioritise their spending on other things. [Council Rent Paper 2011]
SU comments have focussed on maintaining affordable rents which we believe we have addressed as far as we can without creating unacceptable levels of cross subsidy in more expensive rents subsidising the cheaper rents. [Council Rent Paper 2019]
In spite of Council’s claims to have addressed USSU’s concerns, it is clear from Figure 1 and Figure 2 (both below) that the University housing strategy has systematically reduced and removed affordable on-campus accommodation.
Figure 1 (above) shows all on-campus accommodation since 2010 adjusted to 2020 pounds using CPI [1]. The data for 2021 is projected by keeping rents from 2020 constant with no change relative to CPI, and assuming the demolition of Park Village goes ahead as reported in this year’s Financial Statement. Between 2010 and 2020 the average weekly rent, adjusted to CPI, has increased from £123 to £152. The East Slope Residences project (2017-2020) saw the removal of cheaper rooms with weekly rents below £100 (598 rooms in East Slope and 500 in Park Village) and their replacement by thousands of rooms costing between £155-£168 per week. In 2021 the average weekly rent of accommodation offered on campus is likely to rise to £158. This represents a 29% increase from 2010 above CPI.
Figure 2 above shows the number and cost of single rooms available on-campus since 2010, again expressed in 2020 pounds using CPI [1]. Weekly rents are split into four groups, in £20 bands, from the most affordable (blue) to the most expensive (red). The data for 2021 is projected with no rent increase from 2020 and no change relative to CPI, but with the removal of Park Village’s 500 rooms, which would have been the last remaining on-campus accommodation in the most affordable band. It is clear that the strategy of the last ten years has been to drastically increase the provision of most expensive rooms while removing all of the most affordable provision.
In 2021 just over 5,000 rooms will be available for students. If rents remain as they are in 2020 in CPI-adjusted terms, over 4,000 rooms will be at the highest rent band of between £150 and £170. Less than 1,000 rooms will be available at rents below £150 per week.
By contrast, in 2010 over 1,000 rooms (more than one third of the total provision) were available for weekly rent under £110 and no rooms were more than £150 (all rents CPI adjusted to 2020). Eight out of ten rooms available in 2021 are projected to be more expensive than the most expensive rooms in 2010 when adjusted to CPI.
This is a huge change. It is a change that has been executed against a backdrop of increasing economic inequality at a national scale, and a reduction in available income for students, and despite continual USSU demands for more affordable on-campus rents. It is a change that is unmanageable right now for low-income students, especially those struggling to maintain or even find part-time work, and without the necessary subsidies of scholarships. It is also unsustainable in the long term.
2. Students’ finances
As highlighted repeatedly by USSU to Council, rent levels have historically outstripped income streams available to students since at least 2011:
During consultation, the Students’ Union produced evidence to show that the cost of higher education is moving ahead of increases in grants and loans. In particular, concerns have been raised about increases in rent levels running ahead of these income streams. [University of Sussex Council Rent Paper 2014]
In 2018/19 weighted average rents make up 73% of the maximum available cash available to students in the form of grants and loans. In 2011/2012 the equivalent proportion was 58% [Accommodation Costs Survey, Unipol, NUS, 2018]
Maintenance grants and loans available to low-income students have developed in a haphazard way between 2010 and 2020, but in that time the total amount of maintenance loans and grants available to low income students has increased by only 1.3% above CPI. The yearly increase in loans and grants has been erratic, but has been consistently below the average Sussex on-campus rent increases. Average on-campus Sussex rents for 2020, for 39 weeks only, uses 68% of the available maintenance loan for low-income students. For other students it’s higher, forcing them to depend on other income.
At Sussex two of the strategic mechanisms used by the University to support students faced with accommodation costs have been the First Generation Scholarship Scheme (FGSS) and the Sussex Excellence Scholarship Scheme. As reported in the Council Rent Papers of 2016 and 2019:
A Sussex Excellence Scholarship Scheme to award bursaries to students with 3 Grade As at A Level was also introduced from September 2014 and this also helped 260 students to meet the costs of their accommodation. [Council Rent Paper June 2016]
We continue to support students through the First Generation Scholarship Scheme (FGSS). In 2017-18 1,592 students received the £2,000 funding as a contribution towards their university accommodation representing a circa £3.2m investment by the University to help towards accommodation costs. [Council Rent Paper 2019]
Both these scholarships were cut in 2020 following the implementation of the Financial Review Guidelines. These cuts hit low-income students the hardest. The USSU referendum of Autumn 2020 found 92% (802) of student respondents were in favour of lobbying ‘the University to reinstate and expand the First Generation Scholar scholarships/bursaries to all students including Masters students’.
Meanwhile the global pandemic has hit the hospitality industry hardest. 16-24 year-olds have experienced the highest number of redundancies and now have lower numbers in work than at any point during the financial crisis of 2008-09. The income streams that the majority of students rely on, to pay rent and buy food, have disappeared. This includes students on Tier 4 visas, many of whose families have taken out loans for their children in order to pay exorbitant international fees and have now also lost their own income streams as a result of the pandemic.
In summary, the last ten years have seen the increase of on-campus rents over and above CPI, despite year-on-year lobbying by USSU on affordability. The current crisis has meant the disappearance of part-time work and the removal of scholarships that support low-income students in paying rent and buying food. It also has meant that some international students who are ineligible for UK student finance are unable to pay the tuition fees that they are charged, even when entire extended families and kin networks have sacrificed on their behalf In turn this makes rents even more unaffordable for them. It is hardly surprising that some students at Sussex are now in a position where they feel a rent strike is the only option. They are not alone.
3. The University of Sussex and Balfour Beatty
At Sussex the most recent development of on-campus accommodation with 2,000 rooms with rents between £158 and £168 per week is provided and managed through a series of holding companies and a contract with Balfour Beatty. The Balfour Beatty 2019 annual report notes
Balfour Beatty is designing and building the University of Sussex’s new £179 million on campus student accommodation development, and will operate it for the next 50 years. Balfour Beatty is the University’s investment partner for the project, which is part of a £500 million programme of investment for the campus.
The company made a yearly profit in 2019 of £138 million and remuneration of the two highest paid Directors was £2.95 and £1.45 million.
The East Slope Residence Partnerships Accounts for 2019 require more analysis, but refer to the contract end date of 2072. While the University of Sussex Financial Statements 2019-2020 record:
Two points stand out from this excerpt. First, the agreement with Balfour Beatty, whose directors’ remuneration is tagged to the maximum profit target [p117, Balfour Beatty Annual Report and Accounts], includes parameters for student rent setting for the 54 years, with little detail on the oversight of this rent setting. Second, Sussex is liable for 75% of the rents for the first four years of the contract. It is clear that this is a long-term investment to generate a profit for Balfour Beatty, and that the global pandemic will make the contract expensive for Sussex if rooms are unoccupied. As the 2020 HEPI report Student Accommodation: The Facts states,
One conclusion from these momentous events [covid] is abundantly clear: all student accommodation providers (whether institutional or private sector) are reliant on the teaching and learning processes of their education institutions, and co-operation and communication between higher education institutions and those who provide a home for their students have never been more important.
4. Sussex rent strikes and the future
Where does this complex mess leave us all? Clearly action on rent affordability, both during the crisis and long term, is required urgently. Students at over 30 universities are organising rent strikes and here, on campus, the Sussex Renters Union are making the following demands of the University:
Reduce rent by 40% for students in uni halls.
Allow students to exit their tenancy contracts without penalty.
Join students in lobbying the national government for greater financial support for students.
No COVID job losses.
No disciplinary action for strikers.
Over 500 students at Sussex have already signed up to withhold rent. All students’ 39-week rent contracts are paid in three equal installments at the beginning of October, January and April. Students can not terminate their contracts unless they pay the full amount, or find a ‘suitable replacement occupier’ or leave their course. Excluding the new East Slope Residencies which have only just been opened, we calculate a 40% reduction on student rent payments would amount to £2.6 million on each of the three parts, or £7.8 million for the year, so £3.9 million for half a year [2].
We should recall that rents have increased above inflation for ten years, and that reducing the 2020 average rent by 19% would, adjusted for CPI, only bring it in line with the average rent of 2010, and that is before we factor in the issue of students’ increased economic precarity and needs during the pandemic. We should also remember, then, that the University has already saved over £3 million by cutting the First Generation Scholarship scheme contributing £50 pw in rent for thousands of students. When we add in unavailability of part-time work as an income stream for students, the call for 40% rent reduction starts to look not only reasonable but indeed moderate.
While funding and crisis-related financial pressures on the University are not insignificant, we note that the Vice Chancellor has repeatedly stated that Sussex is in a sound financial position, and the most recent financial statements support this. Furthermore, our success and reputation depend on how we support our community. We remind readers that at Sussex a 1:6 pay ratio, capping the highest salary at £105k, would save over to £1.3 million a year in basic salary.
The challenges we’ve outlined are national in nature and the omission of public co-ordinated statements from Vice Chancellors on the rent crisis is notable. Indeed, reasonable concerns have been voiced that the push for rental income has been behind the calls for students to ‘return to campus’ against the advice of SAGE.
University leaders must join students and staff in lobbying for greater financial support for students struggling to afford to live. Students must be able to exit their tenancy without penalty. We will not accept the arguments that such support necessitates job losses. Such arguments are unsound given the sums involved, the financial position of the University of Sussex, and the already high workload and student-staff ratio at Sussex. It should go without saying that Sussex should not take disciplinary action against students for organising and calling for affordable rent, after all, the 2025 University Strategy calls on the ‘distinguished tradition of disruptive and experimental interventions.’
In the longer term, an affordable rent policy must be implemented as soon as possible and benchmarked annually against student income streams instead of an inflated housing market.
The nature of student housing needs to be reconsidered. The Seasalt Housing Co-operative, set up in 2018 by students at the universities of Brighton and Sussex is working with other student housing co-operatives to provide community-led affordable housing for students. On-campus accommodation needs to learn from such grassroots movements where accommodation is run by students, for students.
If the financial pressures on universities are such that the for-profit Balfour Beatty style 54-year contracts are seen as a valid way to balance the books, allowing for corporate interest to shape student experience and education policy, we all need to demand serious changes in the way universities are funded.
It is clear universities must move away from the financialised structure of Higher Education where students are made into capital resources to be exploited. The Sussex Renters Union rent strikes are part of the movement to counter this form of exploitation. We support and applaud their work.
Crisis Justice Sussex
[1] Sussex on-campus rents 2010-2020, Sussex UCU Finance Working Group, January 2021. All calculations shown in the spreadsheet use information in the public domain. Please get in touch via ucusussex@sussex.ac.uk if you spot errors or omissions.
[2] On-campus rents considered here also include the Kings Road residences (on Brighton sea-front) with 124 rooms, up to 2017. These rents are included because they are considered in Council Rent papers [3] up to June 2016. Kings Road residences rent is currently £127.24-£137.24 per week. The Kings Road room numbers account for less than 5% of all rooms. Kings Road residences staged a successful rent strike in 2017. It is not known why they are now omitted from Council papers on rent setting.
[3] Council papers confirming student rent 2010-2020
C-240-14 Student Accommodation Rents 2019/20, June 2018
C/220/13 Rents student accommodation 2015/16, June 2014
C/216/16 Rent Proposals 2013/14 - 2014/15, June 2013
C/212/15 Student Rents, June 2012