Adelaide University faces $250m budget shortfall, considering wage cuts to save jobs
The University of Adelaide is staring down a $250 million budget hit – far more than first reported, far more than SA’s other unis – and is considering cutting staff wages.
Tertiary
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The coronavirus downturn will cause a $250 million budget shortfall at Adelaide University over this year and next, Acting Vice-Chancellor Mike Brooks says.
To rein in expenses, the university will explore cutting staff wages to save jobs.
Professor Brooks told staff that an estimate of a $100 million shortfall this year, made a month ago, had now been updated with modelling for 2021.
Following the first estimate, the university “responded with a range of measures, including deferral of capital works, a pause on hiring new staff, and short-term borrowings”.
However, further action needed to be considered.
“In this period of considerable uncertainties, my priorities are the sustainable future of our institution, the jobs of our staff, and the continued provision of world-class education and research,” he said.
This had brought into focus a deal suggested last month by the National Tertiary Education Union and a group of vice-chancellors.
Jobs would be protected but staff would take a pay cut or extended leave over Christmas.
The deal, recommended nationally but applying to universities individually, was rejected by at least 17 institutions.
NTEU national president Alison Barnes said the union would “now escalate to what will be historically high levels of industrial disputation”.
However, Professor Brooks said Adelaide University Council had mandated the deal be explored.
“We are committed to exploring every avenue for preserving jobs,” he said, but cautioned the university was not locked in and might opt out.
The union’s branch president at Adelaide University, Nick Warner, welcomed the commitment to protecting jobs.
While the national deal had been shelved “the door has been held open” for universities which wanted to adopt something similar.
Flinders University and UniSA have both rejected the jobs’ deal.
Adelaide has a high reliance on international students. They contributed $224.5 million toward $933 million in operating revenue in 2018, its most recent public accounts.
Flinders University projects it will be $54 million down in total revenue this year, including $20 million in teaching revenue.
“The required savings for 2020 have already been identified,” a spokeswoman said.
“The financial challenge is expected to be greater in 2021.
“We are not pursuing the jobs framework as it is designed to provide short-term emergency measures that we do not require.”
UniSA vice-chancellor David Lloyd said lack of support for the jobs’ deal had led the union to “withdraw the document from consideration”.
UniSA — which has modelled a “worst-case scenario” of being $120 million down by the end of 2021 — had considered the deal but preferred to manage the downturn itself in consultation with staff.
“In terms of the impact of COVID-19, UniSA is very fortunate to have a better underlying financial position than some universities,” he said.
Measures already taken included cutting travel and training, delaying capital works and tightening control on recruitment.
Professor Lloyd took a 20 per cent pay cut in April and senior staff a 10 per cent cut.
Universities Australia estimates the sector will be $3.1 billion to $4.8 billion down this year and $16 billion over four years.
“We can’t pretend that won’t have a big impact,” chief executive Catriona Jackson said.
