UCD Students’ Union have been granted loans of over €1million from Bank of Ireland to help sort financial difficulties.
Loans totalling €1.075m were taken out by two separate legal entities, UCDSU Ltd and UCDSU Commercial Services Ltd; however UCDSU remain the only shareholder in UCDSU Commercial Services Ltd. UCDSU Ltd has drawn down their total loan of €645,000, while UCDSU Commercial Services Ltd are only drawing down about one quarter of their total loan of €430,000 at this point.
Students’ Union debts of €1.4m were revealed in April when an advance was received on this year’s capitation funding. Similar to other SUs, €35 from each student’s contribution charge usually goes directly towards financing the UCD Union. As that funding had been advanced, it is not at the disposal of the SU for this academic year.
According to Daniel Keenan, News Editor with UCD’s University Observer: “the debt amounted from the mismanagement and over-spending by previous Students’ Unions meant a loan was inevitable”.
A debt owed to the Revenue Commissioners was part of the reasoning behind the setting up of UCDSU and its services as two separate legal entities. A settlement of approximately €500,000 was reached with the Revenue Commissioners and has since been paid off.
UCDSU intend to use the loans to pay off some remaining creditors, to run and maintain the Union itself over the coming weeks and months, and for capital investment in shops on campus. A shop in the Union’s new Student Centre is expected to receive in the region of €35,000.
UCDSU Commercial Services Ltd. will draw down the remainder of their loan when a capital investment programme is begun on the library, engineering and science shops, all of which require management restructuring and updating. It had been envisaged work on these would have begun by now, but the union now expect it will be the summer before the shops are redeveloped.
The new limited liability company structures adopted by the union will place regulations on their spending which should help prevent such high debts being run up again. There will be a legal obligation on them to file accounts annually, to update shareholders and the Board of Directors of these and the Constitution, which places strict financial restrictions on the Union.
UCDSU President Rachel Breslin told UCD’s University Observer she felt it is important there is now “constant reporting”, of the university’s financial position, “so people will be made aware of what’s going on”.