Letter from the Chairman 2020
At this time of the year I would normally be writing to you ahead of the Annual General Meeting to provide a review of the financial year ended September 2019. With the country and the wider world grappling with Covid-19 the AGM has understandably been cancelled and since the turn of the year much of normal life has changed, including for students at Peterhouse. In that context, my annual letter is appropriately different from what you would usually read.
2019 was a significant year in the history of The Friends. In its fortieth anniversary the Council decided to refresh the purpose of The Friends and review its investment strategy for the first time in many years. The onset of Covid-19 in 2020 brought the first of those into sharp focus, and the second, partly unwittingly, proved advantageous. I will expand on both below.
Overall, The Friends continues in good financial health, with strengthened collaboration with the College and its student bodies, and with the Medical Fund contributing to leading edge research.
Refresh of our Purpose
In recent years three factors came together to prompt the Council to review the primary purpose of The Friends. At our foundation in 1979 the purpose was “to advance the educational and charitable work of the College”. Over the intervening decades the focus of our support evolved from fixed assets such as The Friends Theatre into financial hardship. Post the global financial crash in 2008/9, our resources were insufficient to meet rising demands for financial support and the College progressively bore this burden directly.
Secondly, the opening up of direct dialogue with the JCR and MCR Presidents in 2017 brought to Council’s attention the increasing need to support both the undergraduate and graduate students, and with mental health a significant and increasing need.
Thirdly, the welcome success of the College Development campaign and its annual telephone fund raise had left The Friends looking for a distinctive role.
After much positive dialogue with the College, the Council agreed that The Friends would be repositioned as responsive to the current needs of the student body, reviewing the focus of its activities every three years. For the first period we will be centred on student wellbeing including mental health and inclusivity. The historic commitment to funding certain academic prizes would continue as there are specific donations to support these, but the College will now fund all of the Cambridge bursaries.
As part of this positioning, the College kindly agreed to include a Friends of Peterhouse student wellbeing fund within its annual telephone campaign.
Before the outbreak of Covid-19 the Council had agreed a provisional allocation of its 2019/20 academic year support as follows:
- £25,000 to the Senior Tutor’s fund which has wide discretion around student wellbeing and supporting inclusivity
- £35,000* for a new full time mental health staff post, which has been filled, is well utilised, and warmly appreciated
- £10,000* to continue the part time and independent student counsellor role which The Friends have previously supported
- £7,000 Academic prizes
- £2,000 Yoga classes
- £2,000 Superhalls subsidy to encourage inclusivity
* Council have agreed with the College time related protocols on funding new staff posts before they will transition to the College responsibility. Some readers will remember the Outreach Officers role originally funded by The Friends which transitioned in this way.
The telephone campaign raised c.£4,000 for the new fund in its first year, and at the request of the JCR/MCR this has been earmarked for scaling up an art group with membership from both communities.
Before I deal with the summary of 2018/19, I will turn to The Friends response to Covid-19, which is still evolving and will likely have profound consequences.
Consistent with The Friends new purpose and recognising the unparalleled impact on student health and wellbeing, the Council agreed to commit a one off donation of £50,000 in addition to the £81,000 above. This will be disbursed on application by students through the Senior Tutor’s Fund and a note on its distribution provided to Council in October. This donation has been very well received and was mentioned in the Master’s recent note to all Petreans.
With less than 100 students currently resident in College it is highly likely that actual expenditure against the normal £81,000 allocation may well be different.
Revised Investment Strategy
The Friends’ assets and investment strategy have served us well over the last decade. The maturing of our main bond holding and the receipt of the Fiddess legacy created significant cash balances and prompted the Investment Committee, and then Council, to review our strategy. We would otherwise have been very heavily geared towards UK equities and cash. After considerable analysis and discussion, the Council agreed to continue to take a long-term view of capital growth and restructure our portfolio to broadly align with a geographic view of global GDP growth with some overlays for particular industry sectors. The General Fund is being split between Canaccord and Vanguard equity-based funds, with investment decisions retained by the Finance and Investment Committee. That said, the expectation as a long-term investor is that a light touch review will be undertaken annually with a fuller review every three years. Because the Medical Fund is being expensed over a shorter period, its assets were left in specialist charitable fund management vehicles.
Due to the onerous nature of money laundering rules and regulations which are now required in all fund management companies, restructuring our investments has proven to be a very lengthy process.
As it transpired the sale of our existing portfolio was held back until the two new accounts were fully opened. This took place just before Covid severely impacted financial markets and as a consequence we were around 70% cash when markets fell. Reinvestment into the new funds is being phased in tranches given the volatility of markets but the fundamentals in most economies still look long term positive.
Grants made during 2018/19
The total of grants made from the General Fund for the year ended 30th September 2019 was £63,994, down 2% from the prior year. The main allocations were as follows:
- £10,000 for the part time independent student counsellor available on a confidential basis to help with any personal relationship, mental health, or other problems. This remained fully utilised and highly valued.
- £20,000 towards Cambridge bursaries, and as above this was the last year of this support.
- £25,000 to the Senior Tutor’s Fund, up £5,000 from the prior year. This fund is for purposes where no other source of financial support is available and covers a very wide range of applications from urgent medical referrals, financial distress, hardship caused by changes to family circumstances, and supporting College minority groups to enhance inclusivity.
- £4,175 for academic prizes including the de Montmorency Law Prize and the VI Form English essay prizes.
- £2,000 for yoga classes and £2,000 for Superhalls subsidiaries.
In addition to the General Fund, The Friends Medical Fund was endowed several years ago by a single donor to promote research into mental illness among young adults. Professor Edward Bullmore leads the academic team at the University’s Department of Psychiatry and The Friends are supporting a multi-year research programme with two postgraduate posts at Peterhouse. Professor Bullmore is a regular publisher of research papers which are widely respected inter alia in developing understanding of the causal links between physical and mental illness.
The Friends’ Assets
As at 30th September 2019 the General Fund was valued at £1,780,810, up 1% on the prior year. The Medical Fund was up 4% at £345,924 as the new multi-year programme had not started. Overall funds were up 2% at £2,126,734 within which £667,963 was held in cash at the year end. Current valuations are very volatile due to Covid-19’s impact on markets and so I will wait for a hopefully more stable valuation in next year’s update.
Income received during 2018/19
Investment income was £57,584, up 1% on the prior year. Income from gifts, donations and legacies to the General Fund was significantly lower at £7,314 as there were no legacies received and the flow of individual donations continues to fall away. We hope that the new telephone campaign in partnership with the College will help offset this trend.
Financial Report and Accounts
The AGM held at College as part of the Gathering usually receives and approves the above. Due to its cancellation, there is a need for pragmatism. The Finance and Investments Committee on behalf of the Members will approve these on behalf of the members, and the Reports and Accounts will be available to any member on request from either myself or Ann Munro at the College Office after 1st October 2020.
For the reasons above, the Committee on behalf of the members will approve the re-appointment of Field Sullivan Limited as Independent Examiners.
Re-election of Council Members
The AGM would also have been asked to approve the re-election of four members of the Council who are due to retire by rotation. I will assume that members are supportive unless I hear to the contrary. The Council members are:
- Michael Holmes
- The Honourable Sir Paul Morgan
- Edwards Neve
- Jenny Quan
While nobody will wish these extraordinary constraints to repeat, it would be prudent to change our constitution to deal with the inability to hold an AGM of the traditional type. We will look to bring a proposed amendment to the next meeting.
The Council continues to receive excellent support from Dr Saskia Murk Jansen as Development Director and Dr Stephen Hampton as Senior Tutor. We also welcome the support and engagement of the Master who takes a keen interest in the activities of The Friends and has been a supporter of our refreshed purpose. My thanks also to members of staff in the College Office, Development campaign team, and the Presidents of the JCR and MCR.
I would also like to thank all members of the Council who give up their time voluntarily and conduct their business with considerable thought, diligence and insight. In this most challenging of times I would especially mention the members of the Finance and Investments Committee for helping to navigate us through the choppy waters of transitioning our portfolio.
I would normally end by looking forward to seeing some of you at the AGM. That will clearly not be applicable this year, so if you have any observations or questions please feel free to contact me at the email address below.
With kindest regards
Ian Peters (Peterhouse 1977)
Chairman 2016 –