SA universities boost profits, but challenges remain

Our state’s three unis were hit hard by Covid, but it seems job cuts and federal support have gone a long way in helping their recovery.

Hundreds of job cuts and a boost in federal government support are helping the state's three universities recover from the devastating blow of Covid-19, according to their latest financial results, but uncertainty around the return of international students remains a worry.

In a report presented to parliament last week, Auditor-General Andrew Richardson reveals that the University of Adelaide and University of South Australia each delivered improved profits in 2021, while Flinders University’s was only slightly lower.

The University of Adelaide reported a $201m operating surplus, up from $40m in 2020, after laying off 369 staff, including 108 academic positions.

It secured an additional $107m in federal government assistance – mainly the result of one-off items including a $59m payment for the South Australian Immunogenomics Cancer Institute and $43m from the Research Support Program – helping to boost full-year revenue by 16 per cent to $1.15bn.

A University of Adelaide spokeswoman said the “better than expected” result was also driven by a stronger stock market last year, which delivered a $35m gain on the university’s endowment investments.

University of Adelaide Vice-Chancellor Peter Hoj. Picture: Mark Brake

But she said the lingering impacts of Covid-19, together with the bleak global economic outlook, posed as ongoing challenges.

“While the 2021 results are positive, our forecasts indicate that 2022 and beyond are likely to be much more challenging,” she said.

“There is still considerable uncertainty around international markets, and the fall in enrolments and commencements we have experienced will have an impact over the coming years.”

She said that while many international students had continued their studies online during the pandemic, many were now graduating, and new enrolments were still lagging.

“While commencing enrolments are exceeding expectations, they have been in decline and have declined again this year,” she said.

“As a consequence, the university is on course to be down roughly 20 per cent from 2019-2020 levels.”

UniSA’s profit was up from $21m to $54m in 2021, despite its revenue slipping from $696m to $679m, due to a $34m decline in fees from onshore overseas students.

Academic staff numbers were steady, but 155 non-academic roles were cut.

Flinders University Vice-Chancellor Colin Stirling at the site of the university’s new city campus at Festival Plaza. Picture: Keryn Stevens

International border closures during the pandemic hit UniSA particularly hard last year, with overseas student numbers falling from 5328 in 2020 to just 4037. Flinders and Adelaide University reported smaller falls, down from 3432 to 3007, and 7487 to 7289, respectively.

In his report, Mr Richardson said the global impact of Covid-19 continued to cause pain for all three universities, with combined fee revenue from international students falling by a further 10 per cent in 2021 to $458m, in line with a 12 per cent fall in international student numbers.

Flinders University Hub and Plaza.

“The effect of Covid‐19 on future earnings for the South Australian university sector remains uncertain,” the report says.

“All universities have looked to offset reduced revenues by reducing discretionary spending, deferring capital investment and, in some cases, targeted employee redundancy schemes.”

Flinders reported a $36m profit in 2021, down from $38m, after 54 non-academic roles were lost through attrition and redundancies. Academic staff numbers rose slightly to 886.

The university’s revenue was up from $535m to $557m on the back of an increase in research grants.

A Flinders University spokeswoman said the university had maintained a “solid financial footing” as it emerged from Covid-19, with its new Health and Medical Research Building and city campus at Festival Plaza both on track for an opening in 2024.

“The effects of the pandemic have continued into 2022 but the University is making every effort to minimise the impacts on our staff and students as we welcome them back to campus in growing numbers.”