Many universities are elevating the alarm about their monetary difficulties. Alternatively, if we check with the respectable standards set by way of the sustainability decree that comes into drive in 2024, the placement seems to be a lot much less being worried. What’s in truth hidden at the back of those new standards? To what extent do they in reality tell us concerning the monetary scenario of the college?
In 2024, there have been 60 French universities presenting attainable monetary difficulties (basically deficits). In 2025, whilst 80% of universities nonetheless have price range deficits and universities are calling for assist, simplest 12 universities will formally be in hassle. Via what miracle, in not up to a yr, has the monetary scenario of French universities recovered like this?
The solution to this query may also be discovered within the Decree on Monetary Sustainability (No. 2024-1108) of December 2, 2024, which modifies the standards for assessing the monetary difficulties of universities. This law introduces signs of economic sustainability that imagine {that a} college in deficit (even for a number of years) is not in monetary difficulties. That is provided that it exceeds the minimal threshold of money flows (cash held in a checking account within the State Treasury), operating capital (a reserve of cash held to fulfill deliberate or unexpected bills) and the utmost threshold of body of workers prices (charges and social safety contributions).
In fact, the creation of those 3 new signs (or ratios) relaxes sure price range constraints for universities to drive them to hugely use their reserves (money and dealing capital), as may be required of many state operators within the 2026 price range lately being voted in Parliament.
Alternatively, for universities those reserves are regularly simplest partly to be had, as they’re already earmarked to finance long-term investments, analysis, upkeep, provide contracts or sure components of remuneration (bonuses, promotions or deliberate wage will increase).
Let’s decipher those new signs. Do not they to begin with create an phantasm, making the monetary scenario of the college extra presentable, and the innovative non-involvement of the state extra appropriate?
New calculation strategies
As in different spaces, the satan is in the main points of the process for calculating those signs.
In keeping with this new law, on the finish of the calendar yr, the money float and dealing capital (FdR) of the college will have to be more than 30 days and 15 days of labor in payday loans, with the exception of investments. Those first two ratios are calculated as follows:
Supplied by way of the creator
The numerator of those ratios contains money or operating capital generated by way of funding sources. Then again, the denominator does now not take into accout funding expenditures licensed all through the yr (appropriations for bills).
This calculation way does now not practice the elemental rule for calculating monetary control signs, which calls for the usage of similar calculation volumes for the numerator and denominator. Right here, the numerator contains investments, and the denominator is calculated with out investments, which artificially will increase the worth of the coefficient and lets in, additionally artificially, to exceed the minimal required thresholds.
Exchange within the scope of the price range
To allow the calculation of those new signs, the brand new monetary law redefined the scope of the establishment’s price range, which is now known as the “budget” and which mixes the principle price range (for body of workers, operations and investments) and the connected budgets (together with the annex of the true property price range for the colleges that experience it) (Article R. 719-52).
This modification not lets in for the calculation of those signs to tell apart money and dealing capital which might be in truth to be had (to pay body of workers and operations) from the ones which might be pre-committed for explicit operations (investments, particularly analysis contracts). Via recalculating those signs just for the a part of money and dealing capital this is in truth to be had from the monetary data of the Ministry of Upper Schooling, the choice of days of money is split by way of two on moderate and by way of 3 for operating capital.
Thus, a school that formally items a money float ratio of fifty days (so neatly above the 30 day threshold) most certainly simplest has 25 days of money available. Likewise, the similar college (or different) that may have 30 days of operating capital (so neatly above the 15 day threshold) will most probably simplest have about 10 days of working operating capital to be had.
Suffice it to mention that judging a school’s monetary situation in response to the present calculation of those two ratios is extra like “Russian Roulette” than an goal and fair remark.
Present working prices as adjustment variables
As for the 3rd monetary ratio, its calculation (overall body of workers prices/ monetized merchandise), although money merchandise in large part contain inflexible and restricted sources (subsidy for public provider prices), is much less questionable than its most threshold (83% of monetizable merchandise, 85% for establishments with a dominant focal point on humanities and social sciences).
Why 83% (or 85%)? And why now not 70%? 75%? 80%? Via comparability, in 2022, body of workers prices of public universities within the 38 nations of the Group for Financial Co-operation and Construction (OECD) represented a median of 66% in their overall prices (with French universities having the best moderate charge of round 77%).
Via environment this caution threshold at 83%, universities are licensed to dedicate simplest 17% (and even 15%) in their money source of revenue to operational prices which might be nonetheless very important for the steadiness and sustainability of the college (electrical energy, heating, upkeep of premises and gear, instructing and analysis fabrics and products and services, and many others.).
Calculating this ratio by way of body of workers class (instructing, administrative, technical) in response to overall expenditure, as executed by way of the OECD, would most certainly be extra related and make allowance global comparisons.
Uncertainty about the true monetary difficulties of the college
In the end, a majority of these approximations or inadequacies of calculations can both give the affect of amateurism within the monetary keep an eye on of French universities, or, extra indubitably, the sensation of in need of to hide up the truth of economic difficulties, and to make the colleges increasingly more depending on them.
The hot 2025 Senate Data Document recognizes that merely studying college budgets and signs of economic sustainability does now not make it conceivable to determine a hyperlink between establishments’ price range information and their actions.
Within the brief time period, operating capital and money float of universities don’t seem to be bottomless pits, it’s most probably that a lot of universities will not be in a position, very quickly, to tackle ordinary monetary duties (upkeep of premises and gear, fee of salaries, bodily admission of all scholars).
Within the medium time period, it’s the success of the college’s primary public provider missions (creating get right of entry to to raised training, scholar luck, expanding their employability, strengthening social and territorial concord, analysis building) that might be deeply puzzled.
