Manchester University has ruled out redundancies as a means of dealing with its poor 1995/96 grant settlement.

Martin Harris, vice chancellor of the university, said: "There is absolutely no plan for any redundancies of any kind, or for any research-active staff to leave the university."

Manchester was among the universities which received the minimum cash increase - 0.5 per cent - in the Higher Education Funding Council for England allocations.

Professor Harris wrote to staff earlier this month saying there was "no new money coming to us to meet the cost of pay increases and inflation on non-pay items and we ourselves must therefore generate the money we shall need for this".

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He said the institution's cost base was too high relative to its activity. To make the adjustments needed to maintain and develop its standing in research and teaching, the university would have to re-examine its financial base and other assets.

Professor Harris said he had set up a group to work out early retirement and voluntary severance proposals.

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"No one has the right to enhanced early retirement or to receive a voluntary severance payment. Each case will be considered in relation to managerial interest," he added.

Vacancies will be reviewed as they become available.

The adjustments include a research fellowship and lecturership scheme aimed at attracting high quality research staff. Last week the university advertised 40 graduate research studentships and 60 post-doctoral scholarships.

Brian Everett, north-west regional secretary of the Association of University Teachers, said: "We are happy that there are guarantees that there will be no compulsion and will be watching to see how the university management acts over the next term or so, to ensure that there is no undue pressure on any of our members."

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