MINUTES A meeting of the Council was held at 17.00 hours on 18 June 2013 in BOX, 5th Floor, Tower 3, LSE.
PRESENT: Mr Peter Sutherland (Chair), Ms Kate Jenkins, Ms Anne Lapping, Professor Craig Calhoun, Dr Jason Alexander, Professor Martin Anthony, Ms Virginia Beardshaw, Ms Angela Camber, Professor Stuart Corbridge, Mr Eden Dwek, Mr Alan Elias, Dr Matthew Engelke, Mr Tim Frost, Professor George Gaskell, Mr Richard Goeltz, Mr Nigel Hugill, Professor Janet Hunter, Professor Paul Kelly, Professor David Marsden, Mr Mark Molyneux, Professor Eileen Munro, Ms Alex Peters-Day, Ms Harriet Spicer, Professor David Stevenson.
BY INVITATION: Ms Liz Chapman, Mr Julian Robinson.
IN ATTENDANCE: Mr Andrew Farrell, Ms Susan Scholefield, Mr Mike Ferguson, Ms Jayne Rose, Ms Jane Pugh.
APOLOGIES: Ms Lis Astall, Mr Eden Dwek, Professor Emily Jackson, Mr Mark Molyneux.
COUNCIL MEMBERSHIP The Chairman acknowledged the significant contributions made by those members of the Council who would be standing down at the end of the 2012-13 academic year, namely: Professor Martin Anthony, Ms Lis Astall, Mr Richard Goeltz, Professor Emily Jackson, Professor David Marsden, Professor Eileen Munro, Ms Alex Peters-Day and Professor David Stevenson.
DECLARATIONS OF INTEREST No member of the Council declared an interest in relation to the matters to be discussed.
COUNCIL MINUTES 221. RECEIVED: the minutes of the meeting of the Council held on 15 May 2013.
222. RESOLVED: to approve the minutes as a correct record.
INCIDENT 223. REPORTED, by Professor David Stevenson: that a false ceiling had collapsed on the second floor of Sardinia House (where HR staff are based), and that the building had been successfully evacuated.
Post-meeting note: All affected staff have been moved to alternative accommodation and building contractors are investigating.
COUNCIL PAPERS 224. REPORTED, by the Chairman:
a) that the papers for the meeting had been voluminous and that it should be possible to produce two-page summary documents focused on key issues;
b) that Council members had the opportunity, should they wish, to request further information from relevant Officers prior to each meeting.
MATTERS ARISING North Korea/ BBC 225. REPORTED, by the Chairman:
a) that responses from the BBC to the School’s complaint had been unsatisfactory;
b) that the Chairman had on 14 June 2013 sent a forthright letter to the BBC Trust, from
which he quoted;
c) that whilst the School did not wish to bring about a public disagreement with the BBC, it sought an apology and undertaking that such practices would never be repeated.
226. RESOLVED: to thank the Chairman and former Chairman (Lord Grabiner) for their assistance and leadership on this matter.
DIRECTOR’S REPORT 227. RECEIVED: paper CL/34, the written report of the Director.
228. REPORTED, by the Director:
44 Lincoln’s Inn Fields a) that the School now found itself in a competitive bidding process for the acquisition of the Cancer Research UK building;
b) that the Chair of the Estate Strategy Committee would be invited to update the Council on the latest developments.
Deputy Director and Provost (DDP) c) that the Selection Committee would be meeting on 20 June to draw up a shortlist and that final selection would take place on 28 June;
d) that Council would be represented on the selection committee by Ms Virginia Beardshaw, Professor Janet Hunter and Professor David Stevenson.
Rewarding Our People e) that paper CL/37, “REF 2014 Update Rewarding Our People: A Strategic Question” had been circulated in error;
f) that a shorter paper headed “Academic Staff Salaries: A Strategic Question” had been tabled for Council discussion.
Queen’s Birthday Honours g) that four of LSE's leading academics had had their expertise and service rewarded in the Queen's Birthday Honours list;
h) that Nobel Prizewinner Professor Christopher Pissarides, Professor David Metcalf and Professor John Hills had been knighted for their services to economics, UK migration policy and social policy respectively; and that Professor Judith Rees has been made a Dame Commander of the British Empire (DBE) for her services to higher education;
i) that several alumni had also been honoured;
j) that more would be done to communicate this splendid news.
229. RESOLVED: to note the report of the Director.
44 LINCOLN’S INN FIELDS 230. RECEIVED: a tabled presentation produced by the Director of Estates and headed, “44 Lincoln’s Inn Fields (CRUK) – Update 1”.
231. REPORTED, by the Chair of the Estate Strategy Committee:
a) that following discussion within Council on 15 May 2013, the School had submitted an off-market bid to the trustees of Cancer Research UK (CRUK) for the purchase of 44 LIF for the sum of £60m;
b) that CRUK had since received unsolicited competing bids which they would be duty bound to put before their trustees for consideration at a meeting to be held on 23 July 2013;
c) that it appeared less certain that Westminster Council would reject a future application for change of use to include residential development, thus making the site more attractive to developers and increasing its potential value;
d) that if Council decided that the School should continue to express interest in acquiring the site, it would be prudent to increase the bid to at least £70m and to take steps to make the offer as attractive as possible, e.g. by offering a large deposit and swift exchange;
e) that a bid of £70m would exceed significantly its market value as an office building (circa £55m) but not its potential value as a site for residential use (£70-75m if there were to be a condition that social housing be provided on site; and circa £85m if social housing could be located elsewhere);
f) that the Council should only countenance a bid significantly in excess of the market value if the strategic value to the School justified doing so.
232. IN DISCUSSION:
a) that as the size of any loan to fund the purchase increased, the covenants might also become more stringent and burdensome and could unduly constrict the School;
b) that development of the site for residential purposes would risk students’ full enjoyment of the facilities provided by the New Students’ Centre, notably the bar and nightclub;
c) that it might be possible for the School to campaign vigorously against conversion for residential use, although Westminster Planners might be loath to take a ruling which would prevent a charity from maximising the value of its asset;
d) that alternative sites had been considered and found less suitable or affordable. These had included 45-59 Kingsway, 22 Kingsway, New Court, Bush House and 265 Strand;
e) that if the School were to acquire the building the rationale for so doing would need to be effectively communicated to internal audiences, along with the message that it would not constrain the School from taking forward other important, people-focused workstreams;
f) that the School would gain more than just a building, but also a sense of campus and the opportunity to reduce or eliminate inequity in the quality of office and teaching space;
g) that the initial outlay had to be seen within the context of a potential lifetime of use;
h) that the site was ideally placed and would enable the creation of the kind of environment that the School and School community would need;
i) that the building would not be available until 2015, effectively creating a ‘cooling off’ period and opportunity to dispose of the site if financial fortunes or the needs of the School changed in the interim;
j) that it was not a question of buying a building, but of the benefits it might provide: the School was stretched for teaching space in term time; not all staff and students benefited from common room space close to their department; contact and productivity suffered when staff worked at home because they found their office space unsuitable or uncomfortable;
k) that, if attained, 44 LIF would be an integral part of an overall plan to improve the image of the School, the flow of people around the campus, to deliver a better student experience. It would be an investment in securing the School’s standing in a competitive time.
233. RESOLVED: unanimously, to authorise a bid of £70m for acquisition of 44 LIF, packaged so as to increase the attractiveness of the bid, i.e. (large deposit, quick exchange, possibility to hold the deposit in escrow and donate any accumulated interest to CRUK).
ACADEMIC STAFF SALARIES & EQUALITY AND DIVERSITY 234. RECEIVED: a paper headed “Academic Staff Salaries: A Strategic Question”.
235. REPORTED, by the Director:
a) that confidence in the fairness and transparency of the School’s processes for setting academic salaries was less than in those for determining promotion;
b) that in areas where there had been significant competition, the School had relied on market supplements to secure and retain staff;
c) that RQIF, market supplements and other reward processes had increased salary differentials;
d) that outstanding researchers attracted a premium in a competitive market for staff, which had to be reconciled with the School’s commitment to teaching excellence and contribution to the broader School community;
e) f) that the proposed consolidated budget had included an allowance for addressing historic pay anomalies;
f) that the paper presented to Council was a progress report and demonstrated commitment to tackling in earnest issues around equality of opportunity, fairness and transparency.
236. RECEIVED: paper CL/38, a report on Equality and Diversity.
237. REPORTED, by the Director: that issues of equality and diversity were broader than equal pay and academic staff hierarchy, although there would be some overlap.
238. REPORTED, by the Chair of the Equality and Diversity Committee of the Council:
a) that the report gave a useful overview of current activity;
b) that considerations of equality and diversity had to be taken seriously, having ethical, legal and reputational dimensions.
239. IN DISCUSSION:
a) that members of Council would welcome clarity as to timescales, communication strategy; and also assurances that the School had sufficient resources to do the work thoroughly.
240. REPORTED, by the Director:
a) that release of raw aggregated data which took no account of rank, field or length of service had been unhelpful and misleading;
c) that the School had commissioned the production and analysis of robust data on pay equality;
d) that Council and the Academic Board had both been briefed on the priorities for action and scheduling of the various strands of work (as set out in para 3 of paper CL/38).
241. IN DISCUSSION:
a) that not all colleagues would have been aware of the use of salary supplements in some departments and the resulting pay differentials;
b) that the cost of achieving vertical equity in pay would be financially crippling, but that it should be possible to achieve something approaching horizontal parity;
c) that those departments offering salary supplements were also those charging the highest fees and producing the largest contributions to School surpluses.
242. RESOLVED: to note the reports on Academic Staff Salaries, and Equality and Diversity.
REF 2014 243. RECEIVED: paper CL/35, a report on progress with preparations for the Research Excellence Framework 2014.
244. REPORTED, by the Pro-Director (Research):
a) that the School had been preparing in earnest for the REF for the last three years;
b) that faculty had been made clear as to the expected standard and provided with support to assist them in producing high quality research;
c) that it was expected that 81-84% of LSE academics would be entered in the REF;
d) that the School had returned 92% of staff in the 2008 Research Assessment Exercise, but that the bar had since been moved higher.
245. RESOLVED: to note paper CL/35.
RQIF 246. RECEIVED: paper CL/36, review of the Research Quality Investment Fund (RQIF).
247. REPORTED, by the Pro-Director (Research):
a) that the exercise had highlighted some of the challenges facing the School in attracting and rewarding new talent, whilst demonstrating fairness to existing staff;
b) that this had in part prompted the Director’s paper on Academic Staff Salaries (see above).
248. RESOLVED: to note the report on the review of RQIF 2012-13.
LIBRARY MASTER PLAN AND WOMEN’S LIBRARY 249. RECEIVED: paper CL/39, Library Master Plan and the Women’s Library.
250. REPORTED, by the Chairman:
a) that works to accommodate the Women’s Library had been subject to considerable cost over-run;
b) that the Chair of the Audit Committee had been informed, and that the Director of Finance and Facilities had commissioned an investigation into how this could have occurred and how controls might be tightened.
251. RESOLVED: to note the progress of the Master Plan; and to approve the allocation of £3.39m for Phases 1 and 2 of the Library Master Plan.
REPORT OF THE FINANCE COMMITTEE 252. RECEIVED: paper CL/40, the termly report of the Finance Committee.
253. REPORTED, by the Vice-Chair of the Finance Committee:
b) that the School had an ordinary balance sheet but an extraordinary profit and loss statement;
c) that that there had been an overall 17.4% increase between 2012/13 and 2013/14 in academic pay expenditure; and that this equated to a 12.4% increase in average academic pay;
d) that the Finance Committee could make resources available for School purposes but could not monitor whether financial investments had succeeded in achieved desired results.
BUDGET PROPOSALS AND 5 YEAR FORECAST 254. RECEIVED: paper CL/41, the proposed budget for 2013-14 and five-year forecast required by HEFCE.
255. REPORTED, by the Vice-Chair of the Finance Committee:
a) that only Council could approve the budget and forecasts;
b) that following Council’s decision to increase the bid for acquisition of 44 Lincoln’s Inn Fields, the figures would need to be adjusted by a further £10m;
c) that a number of items in the budget were provisional sums which might or might not be required;
d) that if the School were to succeed in acquiring 44 LIF for £70m, and the Council were to opt to raise £125m in private finance to fund demolition and rebuild, there would still be £22m headroom in the budget;
e) that the budgeting process had continued to improve incrementally.
a) subject to any minor adjustments recommended by the Finance Committee and which would be reported orally to the Council at its next meeting, to approve:
b) the income and expenditure budget for 2013/14 and budgeted balance sheet,
c) the capital expenditure budget for 2013/14; and
d) the HEFCE five-year forecasts.
FEE LEVELS FOR 2014 ENTRY 257. RECEIVED: paper CL/42, the proposed fee levels for 2014 entry.
258. REPORTED, by the Pro-Director (Planning and Resources) in his capacity as Vice Chair of the Academic Planning and Resources Committee (APRC):
a) that the fee-setting process did not involve applying a standard inflationary uplift to programmes across the board;
b) that fees were not set for each specific programme, but programmes were instead allocated to a particular band and can be moved between bands;
c) that the APRC assiduously monitored the market before reaching decisions on banding.
259. RESOLVED: to approve fee levels for 2014 entry, as set out in paper CL/42.
REPORT OF THE AUDIT COMMITTEE 260. RECEIVED: paper CL/43, the termly report of the Audit Committee and its appendices: a revised risk register; a report on North Korea: Lessons Learned with an accompanying draft policy on Fieldwork and Visits; and the draft Internal Audit Plan for 2013-14.
261. REPORTED, by the Chair of the Audit Committee:
b) that then Council were invited to approve the draft policy on Fieldwork and Visits;
c) that the Audit Committee had recommended retaining an outsourced internal audit service;
d) that Council were invited to approve the extension of the contract with BDO for the Head of Internal Audit and Internal Audit Service until 31 July 2014;
e) that Council were invited to charge the Audit Committee with tendering for the provision of this combined service in early spring 2014;
f) that the draft Internal Audit Plan would be finalised in consultation with stakeholders and would come to the Audit Committee and Council in September 2013 for approval;
g) that Council were invited to send any comments on the draft IA Plan to the Chair of the Audit Committee for consideration.
262. IN DISCUSSION:
a) that there might be a danger in drafting a new policy in response to an incident which had quite distinctive features and which was unlikely to rematerialise.
263. REPORTED, by the School Secretary:
a) that whilst the North Korea incident had unusual aspects, visits and fieldwork at home and overseas were not uncommon and recent events had given renewed impetus to the need to tighten up practices around risk assessment and mitigation;
b) that Heads of Department had been made clear of their responsibilities in this regard, which put simply were to ensure that a risk assessment took place, that FCO advice be sought and appropriate insurance taken out;
c) that the policy was intended to be applied with common sense and proportionality.
a) to relay to the School Secretary any comments on the draft risk register;
b) to approve the policy on fieldwork and visits;
c) to approve the proposed approach to extending and then tendering for the outsourced Head of Internal Audit and Internal Audit Service;
d) to relay to the Chair of the Audit Committee any comments on the draft Internal Audit Plan;
e) to note the termly report of the Audit Committee.
REPORT OF THE NOMINATIONS COMMITTEE 265. RECEIVED: document 23, the Report of the Nominations Committee.
266. REPORTED, by the Chairman: that Council were invited to approve the award of Honorary Doctorates of the School.
267. RESOLVED: to approve the award of Honorary Doctorates of the School to those candidates identified in paragraph 2.4 of document 23.
COMMITTEES OF THE COUNCIL 268. RECEIVED: document 24, the membership and terms of reference of committees of the Council for 2013-14.
269. RESOLVED: to approve the membership and terms of reference of committees of the Council for 2013-14.
STANDING ORDERS 270. RECEIVED: document 25, the Standing Orders of the Council for 2013-14.
271. RESOLVED: to approve the Standing Orders of the Council for 2013-14.
LEASES AND LICENCES 272. RECEIVED: document 26, leases and licenses for Council approval.
273. RESOLVED: to approve entry into the agreements listed in the schedule of approvals in document 26.
REPORT OF THE VICE CHAIR OF THE ACADEMIC BOARD 274. RECEIVED: document 27, the report of the Vice Chair of the Academic Board.
275. RESOLVED: to note the report of the Vice Chair of the Academic Board.
SECRETARY’S REPORT 276. RECEIVED: document 28, the report of the Secretary and its appendices: the annual report of the Health & Safety Committee; the list of documents sealed during the 2012-13 academic year; and the log of contracts signed by the Secretary under authority delegated by the Council since the last termly report.
277. REPORTED, by the Secretary: that a revised Health & Safety Policy would be brought to Council in September, for approval.
ANCILLARY PROGRAMMES BOARD 278. RECEIVED: document 29, the Annual Report of the Ancillary Programmes Board.
a) to note the Annual Report of the Ancillary Programmes Board;
b) to acknowledge the importance of the ancillary programmes to the financial health of the School; and
c) to thank the Chair of the APB, Mr Neil Gaskell, for his excellent stewardship.
RELEASE OF PAPERS 280. RESOLVED:
a) that all papers from the meeting be released with the exception of REF, RQIF, Academic Salaries, and the Report of the Nominations Committee (until such time as candidates have confirmed that they are willing to receive an award of the School).
b) that the minutes of the Council meeting held on 15 May 2013 would be redacted to remove reference to property and remuneration issues.
There being no other business, the meeting ended at 7.15pm and was followed by a drinks reception for those Council members who would be standing down at the end of the year.