Mikael about the financial situation
Head of School Mikael Lindström writes about how the economic development affects KTH and what needs to be done in the next few years.
Unfortunately, we have had a tough world situation in recent years with a pandemic and a war-torn country in Europe, which has not only meant great human suffering but also negatively affected the economic development. In this context, it feels slightly trivial to write about the challenges for KTH and I am convinced that we will be able to handle these in the same way that we got through the pandemic.
The challenge for us at KTH this time lies in the economic development, with sharply increased inflation, rising electricity prices and, above all, sharply increased rental costs. If we do not act, there is an imminent risk that most of our total agency’s capital will be consumed within the next four to five years. This would mean that we lose the ability to continue developing the business and that already decided strategic investments need to be cancelled.
Regarding the increase in KTH's premises costs, a working group consisting of school heads, the university director, property manager and finance manager, as well as investigative support from GVS, has actively started working on the issue. Depending on the duration of KTH's various lease agreements, there are unfortunately not many measures that KTH can implement that will have an effect in the next few years, but the measures that will be decided will have an effect in the longer term. Therefore, KTH needs to take other measures.
In light of this, school heads and the university director have been tasked with drawing up proposals for measures and impact analyses, a task which must be coordinated with a review of KTH's resource allocation models. Together, we will examine the possibilities for how the whole of KTH can contribute to reducing the negative effects of economic development. We need to work calmly and methodically in dealing with the effects of the economic development and currently see no need to implement any drastic and short-term measures that could risk affecting KTH negatively in the long run.
Mikael