Financial viability needs balancing: UNZ head

PHOTO: ODT FILES
PHOTO: ODT FILES
All universities are going to have to balance the wish for the staffing status quo to continue against the need to remain financially viable, Universities New Zealand (UNZ) has warned.

This follows the University of Otago’s announcement last week that it is considering making several hundred academic and general staff redundant in an attempt to reduce its annual budget by $60 million.

The Tertiary Education Union (TEU) is gearing up for a national push back in anticipation the cuts could be set to spread.

UNZ chief executive Chris Whelan said university leaders were having to make difficult decisions where losses were being forecast over extended periods.

"All universities are going to have to carefully balance their desire to continue delivering top quality teaching and research with their need to remain financially viable," he said.

Salaries made up 60% of a typical university’s costs, so every university would have to look very closely at this area.

The University of Otago has blamed factors including a lack of government funding and a fall in enrolments, which dropped by 0.9% this year, rather than rising 4% as predicted.

University figures show the drop in domestic enrolments caused a loss of $20 million — one third of the shortfall — and staff have also blamed university management.

Mr Whelan said all universities were seeing tough times ahead, and major increases in student numbers or increased Government funding were both unlikely.

"Government controls or provides 77% of university funding.

"In 2023 alone, that funding increased by only 1.6% at a time when inflation is running at more like 6.8%."

Chris Whelan
Chris Whelan
Of the country’s eight universities, Otago, Victoria University of Wellington, Massey University, Auckland University of Technology and the University of Auckland all experienced enrolment drop-offs this year.

This was a "significant issue", caused by things such as financial pressure causing young people to choose work over study, the option to travel overseas again, and the time needed to rebuild international student numbers.

Last month Te Pūkenga also announced plans to cut hundreds of jobs and sell some assets.

The national mega-polytech reported a 10% drop in enrolments this year.

TEU national secretary Sandra Grey said vice chancellors, Te Pūkenga management and UNZ made it sound as if making people redundant was the only option.

"Management have other choices.

"One of them is to work with us to secure more funding, which they have steadfastly refused to do."

The TEU did not plan to sit back and allow this to happen.

"We will be meeting with a group of branch presidents this week to discuss a co-ordinated national approach to fight the cuts."

Victoria has experienced a 12.1% drop in enrolments compared to last year.

Vice-chancellor Nic Smith said the university was undertaking "an intensive programme of work" aimed at increasing enrolments for the remaining trimesters of this year, and for next year.

"The University is also looking at a range of cost saving options but has not yet made any decisions with regards to redundancies."

Stuff reported yesterday that a proposed staffing restructure at Massey University had raised concern with the academic board.

However, the university did not respond to an Otago Daily Times request for comment.

fiona.ellis@odt.co.nz

 

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