London Metropolitan University has scrapped plans to set up an outsourced shared services centre after losing its license to recruit overseas students.
Earlier this year, the university tendered a contract for suppliers to create a new shared services centre, to offer services including IT, payroll and library management. BT, Capita and Wipro were shortlisted for the £74 million, five-year contract.
In August, however, the UK Borders Agency revoked London Met's license to sponsor students from outside the European Union. An investigation had discovered "serious and systematic" failings in the university's handling of non-EU students and their visas.
Last week, the Guardian reported that following the ruling, over 55% of the university's current international students have opted to leave the university, despite being offered a chance to complete their education there.
On Friday, the university said that this change of circumstances has forced it to scrap the shared services plan.
"The university has decided to stop the shared services procurement and to replace it with an extensive and rapid business process re-engineering exercise, focused on our support service areas," it said in a statement.
"Our student and financial landscape has shifted dramatically since the revocation of our Highly Trusted Sponsor status on 29 August, and notwithstanding our success in the High Court on 21 September, our business has changed.
"We no longer feel that the basis on which we opened the competitive dialogue for Shared Services is now the best match for our new circumstances.
"We will now move very rapidly to procure the services of a third-party who will work with us to re-engineer our support service processes. This will help us achieve the transformation required with the maximum speed, and so ensure that our students, who are at the heart of all we do, are better-served. The re-engineering will necessarily also help to take cost out of our business, so that the financial impact of this year’s lower enrolments is mitigated."
The university hopes to have appointed a supplier to provide the business process re-engineering services by the end of the year.
It also revealed that BT had already dropped out of the running for the shared services contract.