Mikael about the school's increasing rental costs
Head of school Mikael Lindström writes about KTH's premises rents, which are expected to increase sharply next year, and how it affects the CBH School.
As I wrote in the previous foreword, KTH's premises rents are expected to increase sharply next year, as a result of the strong inflation in 2022. KTH's rents for the following year are calculated based on the consumer price index (CPI) in October. Inflation is currently estimated at 9.8 percent, which is expected to result in a permanent cost increase of SEK 80 million per year for the entire KTH. Before 2024, we expect slightly lower inflation, 7 percent, which will result in further permanent cost increases for the coming years. Before 2024, KTH can expect some compensation for the increased rental costs in the form of higher grants based on the increase in 2023, while compensation for increased rental costs in 2024 will be received before 2025.
The cost increase will affect KTH's ability to develop in both education and research if nothing is done. A working group consisting of Head of Schools, the University Director, Property Manager and Finance Manager as well as investigation support from GVS has actively started working on the measures proposed in KTH's local supply plan for 2022-2025. All measures and changes need to be preceded by an impact analysis and linked to the comprehensive local supply plan and will in the vast majority of cases require both tough decisions and priorities. Unfortunately, there are not many measures that KTH can implement that will then have an effect in the next few years, the measures that will be decided will have an effect in the longer term.
In 2023, the debiting of premises-related costs (IP premises) will take place in the same way as it was done in 2022, but with an increase of 10 percent calculated on the basis of current inflation forecasts. The increase of 10 percent will take place based on the debiting that takes place in December 2022. This applies to all campuses except SciLifeLab Campus Solna, which has an increase of 8 percent calculated based on current inflation forecasts. The increase of 10 percent will then form the basis of the school's "annual rent" in 2023 and will be charged in 12 parts. In 2023, the charge will only change in the event of major changes in the school's premises. The school will receive increased grants corresponding to the increase, 4 percent of the 10 percent that the "annual rent" is calculated with. For example, if a school is debited SEK 100 million in 2022, the debit will be SEK 110 million in 2023. In addition, the school receives SEK 4 million in increased funding.
Mikael