$1b COVID hit to UTech

At least one Jamaican university has begun liquidating its investments to cushion the fallout sparked by COVID-19, which has decimated the budgets of tertiary schools islandwide.

Institutions have been hit by a downturn in commercial operations, reduced dorm occupancy, and delayed payment of tuition fees since face-to-face classes were halted by the pandemic last March.

Acting president of the University of Technology, Jamaica (UTech), Professor Colin Gyles, said the tertiary institution is running a deficit on annual expenditure and has been forced to tap reserves to stay afloat.

UTech has so far liquidated more than $1 billion in investments that were committed for capital development and other operational support.

WATCH: Universities hit hard by COVID-19

The university has not interfered with project funding, Gyles told editors and reporters at a virtual Gleaner Editors’ Forum on Thursday.

“Unless we are able to recoup these losses, it means that we will be hampered in terms of the number of students that we are able to cater to,” he said, adding that many of the technically intensive courses of study were heavily subsidised.

“It means that the capital expenditures have to be deferred, which means that some programmes which are critical for national development may have to be put on hold,” the acting president said.

Further, Gyles said the university was losing approximately $3 million per month in revenue because of diminished dorm occupancy.

Rooms that once housed two students have now been converted to single units to reduce the risk of COVID-19 transmission. UTech has dorm capacity for 482 students.

Occupancy has plunged by 60 per cent, he disclosed.

President of the Northern Caribbean University (NCU), Professor Lincoln Edwards, said that his dorm population has been “reduced significantly”.

“The cafeteria is also operating below capacity, and there is a 43 per cent reduction in income from the industries,” Edwards revealed.

Data on annual operating cost were not readily available.

Students pay an average of $88,000 for dorm accommodations yearly, Edwards said.

Mico University College has suspended boarding altogether, said its president, Dr Asburn Pinnock, who said boarding was suspended as the university was not capable of putting in enough resources, in light of COVID-19, to ensure the safety of students.

“Boarding for us is not a revenue earner. In fact, it is a cost to us because it is so highly subsidised,” he disclosed.

Pinnock explained that it is a general issue with teachers’ colleges as the culture is not to charge the full cost for boarding and meals.

It costs the university upwards of $70 million to operate its dorms annually, and only 25 per cent is paid by students.

Meanwhile, at The University of the West Indies, Mona (UWI), pro-vice chancellor and principal, Professor Dale Webber, said of the 10 halls of residence, at least four are run at a loss. Three break even and another three generate a profit.

On traditional halls, students pay between $70,000 and $90,000 per semester, while at 138 Student Living, which is operated on behalf of the university, rentals are as high as $200,000 per semester.

A few halls have been closed, and total occupancy currently stands at 1,500 students.

“Year to date, the financial loss is $310 million,” he said.

Webber shared that the university is in constant negotiations with the operators of 138 Student Living as the agreement signed in 2015 guaranteed them 90 per cent occupancy. COVID-19 has scuttled those projections.

He said when the terms were originally agreed, 90 per cent was a “reasonable expectation”, except for down times like the summer break.

judana.murphy@gleanerjm.com