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Issue 479, 18 March 2002

Library materials fund: resource allocation

The Senate is invited to consider, and to approve, the proposed model for the allocation of the Library's materials budget set out below.

1. Background

For many years the University Library has used historical spending patterns for the allocation of its materials budget to academic departments. In addition, until relatively recently, these budgetary allocations were not divulged to departments, and the Library tended to be prescriptive in the way that funds could be spent (e.g. x% to be spent on journals, y% on books, etc.). Within a finite budget, this lack of flexibility served to protect some established disciplines to the disadvantage of other, new and emerging disciplines in the University. The approach also failed to respond to the widely varying 'information delivery preferences' of the different subject disciplines, particularly the shift of some subjects away from University-owned printed sources towards remotely available, online services, and document supply.

The financial context

The search for best value from library budgets has never been more pressing. Library purchasing power has been in decline globally for decades, due, in large part, to the dominance of commercial publishers in the scholarly communication model, and their consistently high price inflation over many years (10-15% p.a., see appendix A). In the UK, this decline is exacerbated by the long-term funding constraints, which are now recognised as an established feature of higher education. (In a list of comparative expenditure in descending order of total expenditure - 219 North American and UK academic libraries 1998-99 - the first UK research library (Cambridge) appears at the 65th position, with Leeds at 101st). The current funding position of Leeds University Library, relative to its UK peers, is shown in appendix B.

At Leeds therefore, the University is showing support for its Library within what is probably an unsustainable model. Cancellations and alternatives to holdings of low-use material appear inevitable for many departments due to high inflation and related decline in purchasing power. The new challenge is to work towards a major review of the current model of research dissemination to achieve a model which is considerably less dependent on commercial publishers.

Transparency

In the interests of good service, and realistic financial management, the Library is seeking to remove the secrecy surrounding the allocation of the Library's materials budget, and to ensure that the funds available are used most effectively to support the Library's full range of user needs. For over two years the Library has therefore been working in partnership with academic departments to:

  • identify a way in which the old, historical model for allocation of materials funds to departments can be replaced with a transparent and rational model — linked to appropriate key drivers; (Resource Allocation Model).

  • implement a fundamental review of historical spending decisions to arrive at core sets of library holdings most needed to support University research and teaching, along with access to a range of additional sources and services, all within permitted departmental funding levels arrived at through the RAM. The desirable balance between University owned holdings (books & journals and the balance of each of these), and licensed services, will vary widely between subject disciplines (Periodicals Voting Exercise).

Given the known constraints, the Library has welcomed the opportunity to implement this new approach, and believes that staff will be placed in a stronger position than previously to advise departments in the most effective means of supporting their scholarly activity by:

  • ensuring a better match between the research and teaching needs of departments, and the journal holdings of the Library, including new, and interdisciplinary, needs;

  • bringing the journals spending for each department into line with their allocation, as assigned under the new allocation model (in the past, journals were notionally allocated against departmental funds on the basis of where they were classified in the Library);

  • releasing money for new titles, or identifying titles for cancellation rather than necessarily maintaining old subscriptions because we always have.

In March 2001, Senate discussed proposals for a new model for Leeds, which drew on some elements of models used elsewhere (Consortium of University Research Libraries). Senate endorsed the use of the new model for 2001/2, subject to a fundamental review of some of the principles involved.

Since March the Library has carried out a fundamental review of the previous model, taking account of issues raised at Senate, and based on a major round of consultation meetings with the Library Advisory Board, HoDs and HoRCs and Departmental Library Representatives. A separate focus group was also established in order to test 'latest thinking' arising from the discussions.

2. Proposed Methodology for Resource Allocation

The Library's materials budget will be divided into three components:

2.1 a support budget;

2.2 allocation of a minimum necessary provision of 7k per department;

2.3 the balance of the budget after deducting 1 and 2 will be the fund available for the resource allocation formula.

2.1 Support Budget

  • General resources

There will continue to be a general budget, which will be used to fund categories of material which are regarded as essential for a research library of this standing, and which individual departments should not be expected to fund. The consultation process has identified the following broad categories as being suitable for inclusion in the general top slice: newspapers, official publications and reference material. A detailed list of the items included will be posted on the Library web-site.

  • Contingency Fund

It is proposed that a permanent contingency fund should be established (in place of the mechanism of moderation at work in the current year). This contingency will be allocated to departments where, in the interests of simplicity, the unique use of the Library by the department cannot be built into the model, resulting in an unrealistic allocation. A total of 200k (7% of the 2001/2 materials budget) will be set aside for this purpose. This element of the support budget will be recurrent, and the amount available will be adjusted in line with inflationary increases.

The Library will issue the 2002/3 allocation to each department by the end of April. During May Faculty Team Librarians will meet with the department to discuss the implications of the allocation and review the current journal commitment (based on the PVE voting). Following these discussions, if there is a need for additional funding, departments will be invited to apply, to the Librarian, for an allocation from the contingency. The Library Advisory Board (see Appendix G) will take the final decision on the allocation of this fund.

  • Collections of national or regional significance

The model currently in operation attempts to recognise the funding requirements of such collections through implementation of moderation following RAM allocation through the model. Following consultation it was agreed that this issue would be dealt with more transparently if removed from the workings of the model entirely. It is therefore proposed that a support budget of 60k (2% of the 2001/2 materials budget) should be set aside to maintain such collections. The following broad subject areas received funding for this in the current year: East Asian Studies, History and Clinical Medicine.

Departments will be invited to submit, to the Librarian, details of collections which they consider to be of regional or national importance, together with a bid for funding to support the continuation of the collection. As with the Contingency Fund, the Library Advisory Board will take the decision on how this element is allocated.

The Library Advisory Board will undertake an annual review of the total support budget and the allocation into general resources, contingency and collections.

2.2 Minimum Necessary Provision

Throughout the consultation process concerns were expressed regarding the effect of applying a model driven by the size of a department on the final allocation. In order to recognise the fact that the formula does not account for the economies of scale, an allocation of 7k will be made to every department to cover a minimum necessary provision.

2.3 Resource Allocation Formula

The general principle of the proposed formula is to recognise the key cost drivers influencing expenditure. The formula therefore:

  • quantifies volume in terms of the FTE using the resource;
  • attempts to recognise how those FTE use the Library;
  • considers price of the resources being used.

Definitions:

Volume

A total FTE figure is used in each element of the calculation. The FTE is the total of Undergraduate, Postgraduate Taught, Postgraduate Research, Research staff, and Academic staff (including Teaching Fellows and Assistants) of the department/resource centre.

The FTE used are published by ASU, and are consistent with those used in the University model.

Use of the Library

Three key areas of use are identified within the model: loans; in-library use of printed materials; the use of electronic resources.

Loans are calculated on the basis of the past two years loan data, contained on the user records within the Library management system. Total loans per department/resource centre are extracted and expressed as loans per FTE. This measure is then weighted according to the average loans per FTE for the whole University e.g. if a department has loans per FTE of 50 and the University average of 25 the loan figure used in the formula is 2.

In-library use is measured on the basis of physical access to the Library, the Library management system records a count against each user record every time the user enters through the gate. Two years data has been used. Total access for the department is expressed as access per FTE. This measure is then weighted according to the average access per FTE for the whole University.

Electronic use is measured as the average number of times resources are accessed per FTE. Once again this measure is expressed in relation to the average for the total population.

Although the current calculations include two years of loan and access data it is intended in future years to include three years data to provide a 'dampening' effect.

Average price

The average price of books and print journals will be the lower of either the Leeds price (based on Leeds University spending patterns) or the national price (based on the statistics produced by the Library Information and Statistical Unit, LISU, based at Loughborough University). Such an approach is intended to encourage wise spending.

% of the Fund Spent

Each of the terms contained within the formula are calculated independently and is then applied separately to the amount of the available fund spent on that particular resource. E.g. the term measuring the in-library use associated with print journals (Total FTE x in-library use x journal price) is applied to the proportion of the available budget spent on print journals in the previous year.

Although this approach may appear to entrench existing spending patterns it is intended that the proportions would be reviewed annually and the formula adjusted accordingly, based on the expenditure pattern of the previous financial year. An annual review is considered essential given that the shift from print to electronic resources is gathering pace. The Library currently spend 25% of the materials budget on books for loan, 10% on books for in-library use, 37% on print journals and 28% on electronic resources.

Available Fund

The resource allocation model will be applied to the amount budgeted for library materials for the relevant financial year, after deduction of the amounts required to fund an allocation for minimum necessary provision to each department and a support budget (general resources, contingency fund and collections of national and regional importance).

The Computation

Each term in the formula (e.g. FTE x in-library use x journal price) is calculated and the result is expressed as a percentage in relation to the total population. This percentage is then multiplied by the amount budgeted to be spent on journals to give an allocation for this particular term. The process is repeated for each term. The total departmental allocation is the sum of the allocations for each of the four terms.

The calculation of the four elements is not intended to reflect the way in which a department is expected to spend the allocation; virement between each type of resource will be permitted.

Resulting Allocations

The proposed model shifts funding from the Arts, Medicine and MPS faculties into the other faculties as compared to the current allocations, although increases and decreases in departmental allocations are prevalent within most faculties. Given that the model now takes the behaviour patterns of each department this is not surprising.

Departments with their own libraries, such as Chemistry, Fine Art and SPEME, tend to receive reduced funding under the model because their loan and access figures are lower, probably due to the activity taking place within the local library rather than the University Library. The use of the 'lower price' concept has also resulted in swings in allocation, especially within the Sciences e.g. Chemistry, Physics and Biological Sciences, due to the variation between the Leeds average and national average price.

It is proposed that resources of a departmental or faculty specific interest currently funded by the support budget (electronic databases, general faculty book funds and other similar resources) should be charged back to those user departments. The costs of these resources will be taken from departmental allocations on a proportional basis. The allocation of electronic database costs between faculties will be proportional based on the range of materials in the database. Resources specific to an individual department will be charged back to that department.

3. Issues Raised During Consultation

Benchmarking

The Library has only been able to obtain data at subject level from Birmingham and Sheffield, on condition it remains confidential. The average spend per FTE in Leeds is 18% higher than Birmingham and 24% higher than Sheffield. However there are exceptions to this. Birmingham spends more per FTE on History, Psychology, Geography and for SPEME.

Research Staff

The Library has attempted to follow the basic principles of the University model in terms of FTE data and consistent treatment of research staff. It is proposed that the Library model must be reviewed in line with any changes to the University model.

Interdisciplinarity

As explained above, the Library is able to respond to interdisciplinary need as a result of the Periodicals Voting Exercise, which aligns need with cost. The exercise showed that over 20% of journal titles purchased are of interest to more than one department.

4. Conclusion

The model of resource allocation set out above is a transparent alternative to using the historical model of professional judgement combined with 'he who shouts loudest'. The University now faces a choice of retaining the historical model or moving forward with a transparent managed approach.

The Library does not claim to have a perfect model, indeed no model is perfect. Throughout the consultation process a continuing theme was the need for simplicity. The formula cannot take into account the nuances of every discipline whilst remaining simple, therefore a permanent contingency to iron out the imperfections is key to a successful implementation. The Library will review and report on all aspects of the model, with particular attention to the effects on departments requiring contingency funding, after the first year of operation.

The Library is now working to a tight time-scale if the proposed model is to be implemented for the academic year 2002/2003. The model must be approved in the current committee cycle if this deadline is to be achieved.


 
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