Friday, 25 May 2012

NUJ facing 'severe financial crisis' says Stanistreet

The NUJ is facing a severe financial crisis and could be insolvent by October, according to a Rescue Plan drawn up by general secretary Michelle Stanistreet (pictured).

The Rescue Plan document also states that overall NUJ membership is down 18 per cent over the last five years.

The union's National Executive Council today agreed a strategy including cuts across all areas of union expenditure, including provision for staff redundancies, in order to meet problems being caused by a fall in union income, rising costs and the challenging industrial environment.

Stanistreet said in a press statement: “This is not the first time the NUJ has had to take decisive action to deal with financial difficulties. Previous solutions to falling income, resulting from a fall in employment in our industries, have sustained us until now.

“But we are conscious that if we are to plan responsibly for the future of the union, and the members whom we serve, we need a comprehensive strategy which involves managing expenditure and practising good housekeeping while continuing to provide the service to NUJ members which they are entitled to expect.

“As an immediate priority we will be extending the union’s activities and membership across all sectors of the industry where the union’s protection is needed by journalists now more than ever before.”

In the Rescue Plan document, the general secretary states:  "There has been no single overnight event that has brought us to this position. The fact that there has been no positive uplift in the industry’s fortunes, and therefore our members’; the continued pressure on our budgets and unresolved deficits in some areas; the drop in subs income in the first half of this budget, 3 per cent more than the 2 per cent decline budgeted; the depletion of our assets and reserves in the wake of successive deficits; and the crisis in our pension scheme – all of these things bring us to the position we are in today, and this combination of factors mean we have to take action. Sitting back and doing nothing is not an option."

"As things stand, after provisions in the accounts for forthcoming agreed expenditure, we have around £300,000 in cash. That only amounts to 3 weeks running costs. We are running monthly deficits averaging over £20,000 (this is after the non-recurring one-off costs highlighted in the accounts). The overall deficit to the end of February is £267,000. If immediate action is not taken this money will run out in October and the union would be insolvent."

She adds: "We also now have accurate data on membership statistics, long overdue. The introduction of a new membership system as well as other organisational changes mean we have access to genuinely meaningful data. This shows an 18 per cent drop in overall membership figures in the past five years. Given the scale of the crisis in our industry we cannot assume that this decline will not continue."

Stanistreet says: "We need to be completely clear that the way out of the crisis will involve cuts across all areas of the union’s expenditure."

The document states that the current estimate is that the necessary savings in staff costs will mean the loss of nine posts out of 47 in total. The union is also grappling with a large pension fund defecit of between £500,000 to £4m.
  • It's no surprise that the NUJ is facing financial problems. Hundreds if not thousands of journalists have lost their jobs in UK in the last five years as the impact of digital media has ravaged print. Maybe something worth having an inquiry about? - Jon S
  • Pic: Jon Slattery

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