Why do universities benefit from external support when reviewing discretionary spend?

By Daniel Snowden, CEO / 8 April 2026

The case for external support for discretionary spend reviews

Across the sector, the financial turbulence of recent years has left few institutions untouched. Universities are being asked to do more with less, all while maintaining quality, supporting students, and safe-guarding jobs. Hiring freezes and voluntary severance schemes have become familiar, if uncomfortable, tools in the sector’s financial toolkit. But before resorting to measures that affect staff livelihoods and academic quality, responsible institutions are looking for other levers to pull. One of the most powerful and often overlooked of these is the non-pay or discretionary spend review.

Why should a university seek external support to do this? After all, who knows an institution’s operations better than its own people? Our experience of supporting multiple universities with this process suggests that bringing in independent expertise is a pragmatic and strategic choice that can unlock millions in savings, strengthen institutional collaboration, and lay the groundwork for lasting cultural change.

Externality ensures objectivity

Undertaking a non-pay review means examining how resources are used across an entire organisation. Decisions about where to reduce or reconfigure spend inevitably have variable impacts across teams, departments and faculties. When done internally, these differences can quickly become politically charged, clouded by relationships, hierarchies, and local priorities.

An external team deploys a neutral methodology and facilitates an agreed process for analysis and decision-making. This independence helps to depersonalise difficult conversations and ensures that findings are seen as objective rather than politically motivated. When staff understand that the review is facilitated by people without vested interests in internal outcomes, it’s easier to secure buy-in and alignment around what makes sense for the university as a whole.

This objectivity is especially valuable in a sector as relationship-driven as higher education, where long-standing networks and shared histories can make impartial decision-making difficult. An external consultancy can act as honest brokers, facilitating consensus, ensuring transparency, and helping leadership teams navigate complex institutional dynamics that can otherwise compromise outcomes.

Objectivity enables challenge

A non-pay review inevitably asks difficult questions: What can we stop doing? What can we do differently? What really delivers value? These are uncomfortable questions to answer when the area under scrutiny is your own. Expecting staff to self-identify major savings is rarely realistic. Human nature makes it difficult to propose changes that might reflect poorly on their own area or disrupt established norms.

External specialists can create a safe structure for challenge. They can ask questions that internal teams cannot, apply evidence-based reasoning, and arbitrate between competing priorities. Crucially, they help to distinguish between what is important at a functional or faculty level and what truly matters at an institutional level. That distinction becomes vital when universities are under pressure to prioritise strategically and when every spend must be justified.

Seeing the whole picture

In the universities we’ve supported with these reviews, the most significant opportunities for saving lie not within individual budgets, but in the spaces between: the fragmented, duplicated, and often invisible activities that collectively drive up costs. Because universities have evolved organically rather than by design, duplication is common; we often discover underused assets, parallel procurement routes, or multiple teams buying similar goods from different suppliers.

An external review helps institutions see across these boundaries. We’ve identified valuable equipment stored in labs and offices that could be shared; or that faculties are independently contracting for the same services. Without a full view of spend, universities miss out on economies of scale and end up managing unnecessary administrative complexity.

External support helps to map these interdependencies, benchmark against peers, and identify where consolidation or collaboration would deliver genuine value. The goal is not centralisation for its own sake, but a more joined-up approach – one that recognises where shared activity, shared assets, or shared oversight make sense.

Moving beyond the ‘salami slice’

Many institutions have already been through multiple rounds of cost-saving exercises. The easy efficiencies are long gone. In today’s environment, the traditional ‘salami slice’ approach (cutting a little from every budget line) delivers only diminishing returns. The only way to achieve true savings without eroding quality is to reimagine how work gets done.

That requires challenging existing structures, questioning long-held assumptions, and sometimes redesigning the distribution of resources altogether. External partners bring both the distance and the expertise to facilitate this kind of reimagining. They can support universities to consider how goods and services are sourced, how activities are prioritised, and how staff and assets can be deployed more flexibly across boundaries and throughout the academic year.

The results can be transformative. In institutions that have attempted to find savings without challenging ways of working, the outcomes are typically limited, with single-digit percentage reductions in discretionary spend. By contrast, where universities have partnered with us to take a holistic, evidence-based approach, we have helped them identify tens of millions of pounds in potential savings without undermining quality or their core mission.

Addressing cultural and leadership barriers

Financial sustainability in higher education isn’t only about balance sheets; it’s about culture and leadership. Historically, university leadership models have rewarded territorial control (larger spans of authority, bigger budgets, more staff) as indicators of seniority and influence. This has unintentionally reinforced silos, discouraged collaboration, and linked resource allocation with perceived importance.

In today’s environment, that model no longer serves the sector well. Effective financial management demands a shift towards evidence-based, insight-led resourcing where decisions are guided by activity need, benchmarking, and alignment to institutional priorities rather than inherited hierarchies. External support can catalyse this shift, helping to articulate the case for change, model new ways of working, and support leaders in developing the confidence to act beyond their immediate domains.

This behavioural dimension is often the hardest to tackle internally, yet it is essential. A successful non-pay review is not just a financial exercise; it is a cultural one. It’s about building the institutional comfort to say 'no' when a project doesn’t align with strategy, when a PO request isn’t merited, and empowering leaders to make evidence-based decisions that reflect the collective good rather than local advantage.

From insight to impact

Our experience has highlighted three interdependent strands that deliver sustainable savings and build stronger institutions:

1. Consolidation: joining up activity and resources where appropriate, introducing mechanisms such as asset registers to enable transparency and shared use, and ensuring decisions are made in the best interests of the university as a whole.

2. Improved financial controls: clarifying delegated authority, tightening spend limits, and strengthening oversight to promote accountability and consistency.

3. Behavioural change: embedding shared responsibility, institutional thinking, and a willingness to challenge established norms.

Each strand reinforces the others. Together, they create a framework not just for cost reduction, but for smarter, more strategic use of every pound the university spends.

A catalyst for change

A discretionary spend review is not about process; it’s about organisational maturity. Spending patterns mirror how a university works – it’s structures, its culture, its decision-making habits. By interrogating those patterns, institutions can uncover the inefficiencies, misalignments, and assumptions that quietly drain resources year after year. And doing so with external support enables them to turn what might otherwise be a narrow savings exercise into a strategic reset that reinforces collaboration, transparency, and financial resilience.

How we can help

If your university is considering a non-pay or discretionary spend review, we can help you design and deliver one that goes beyond short-term savings to drive genuine, lasting change. Get in touch to discuss how we can support you in re-imagining your university’s resources and culture to ensure a more sustainable future.