The University of Otago has received an additional $8.4 million in government funding next year, reducing budget pressures and enabling it to boost the numbers of fully funded student places by 476.
The funding, made public at a university council meeting yesterday, meant the 325 unfunded equivalent full-time students (efts) the university was carrying this year and another 151 unfunded efts expected next year would now be funded.
Next year, all but an estimated 204 of the 19,336 efts places would be fully funded, vice-chancellor Prof Sir David Skegg said.
The news was significant in the present tight fiscal environment, he said.
Tertiary institutions receive about 70% of their government funding through the Tertiary Education Commission (TEC) and the rest from research and performance-based funds.
In 2008, a new system was introduced which stopped guaranteed funding for every student and introduced roll caps, with room to negotiate additional funding for extra places.
Tertiary institutions have been juggling enrolment demand and available funding ever since.
Otago's extra funding for next year comprised $4.35 million to support general enrolment growth; $745,000 to fund 24 more places for first-year student doctors; and a 1.95% inflation adjustment amounting to $3.2 million, Prof Skegg's report to the university council said.
It meant setting the budget had not been as difficult a process as anticipated six months ago, he said at the meeting.
"Overall, the budget is quite a satisfactory result. Divisions will be receiving more [money] next year than this year."
However, Prof Skegg said a significant reduction in government funding had been signalled from 2011 and whether divisions received a budget increase in 2011 was another matter.
The university anticipates a record 19,336 efts next year.
That is an increase of 1887, or 10.8%, over five years.
The number of domestic students is expected to increase by 327, or 1.9%, over this year, and the number of international efts by 134, or 9.4%.
The global recession and its associated effects nationally and locally made this "perhaps the most difficult time in which to forecast enrolments with confidence in at least two decades", Prof Skegg said.
The key assumptions for Otago's predictions were that domestic first-year enrolments would continue to be constrained by the number of places available in residential colleges, and that the number of domestic students returning to university would remain "firm" because fewer jobs were available.
International student numbers, which have fallen by more than 600 efts since 2005 largely because fewer Chinese students are choosing to study here, are expected to start increasing again next year.
An encouraging 28% increase in first-year international student numbers this year and key contracts with overseas universities were laying the platform for growth, Prof Skegg's report said.
Despite rising costs, the university anticipated an operating surplus of $19.33 million next year, the report said.
That is about the same as the surplus expected this year.
Income next year is expected to be $552 million and expenditure $533.1 million.
The university expects to get 23% of its income next year from student tuition fees.
Domestic students are expected to contribute $84 million, up $3.7 million on this year, with international students expected to contribute $48 million, significantly more than this year.
Following several years of modest increases in international fees, fees for next year were increased by as much as 22%.
Operating surpluses are used to fund capital developments and other campus improvements.
The capital development committee's budget for next year has been set at $54.7 million, of which $41.3 million has already been allocated for projects such as the refurbishment of the Bill Robertson library at the Dunedin College of Education campus ($9.4 million), the completion of the new psychology building ($4.5 million), the completion of the Hunter Centre project ($3.7 million) and the creation of a second computer server room ($3 million).
Provision of $13.4 million is available for projects which might be approved during 2010, the report said.
That may include an allocation for the university's building at the Forsyth Barr Stadium site, which is still in the design phase.
Spending above $13.4 million might require the university to borrow, the report said.
Expected roll growth
Domestic equivalent full-time students (efts). -
2006: 15,574
2007: 16, 484
2008: 16,755
2009 forecast: 17,458
2010 budget: 17,785
International efts
2006: 1875
2007: 1674
2008: 1440
2009 forecast: 1417
2010 budget: 1551
Total efts expected for 2010: 19,336, of whom 204 will not be government funded.
