Adelaide and UniSA merger backed in key economic report to Premier Peter Malinauskas

Merging two Adelaide universities would be an important measure to drive increased wages in the future for South Australians, a key economic report says.

The controversial merger of the universities of Adelaide and South Australia has been endorsed in a key economic report as an important measure to arrest an $8000 wage gap with other states.

The SA Productivity Commission report, to be released on Thursday, finds the state government’s focus on a merger is “sound economic policy” that can transform SA “into a high-innovation, high-wage state”.

In a letter to Premier Peter Malinauskas, Productivity Commission chairman Adrian Tembel says almost 40 years of state “activist innovation policies” have failed to spur economic growth.

This has resulted in SA full-time annual wages being $8000 below the national average and Sydney’s $78bn start-up business sector being 50 times larger than Adelaide’s $1.6bn – despite the NSW capital having just four times the population.

Premier Peter Malinauskas talks to UniSA PhD student Casper Liu, while on a visit to UniSA’s Bradley Lab on July 3. Picture: NCA NewsWire / Dean Martin

The report names the former Liberal government’s flagship Lot Fourteen project among a “large number of innovation programs”, which it says are “spread too thin”, “under-resourced” and hard for businesses to access.

The Productivity Commission endorsement will bolster the merger case at a parliamentary inquiry into the proposal, which The Advertiser on July 1 revealed had been backed by both uni councils and almost $450m in state government funds.

The final report of the commission’s Turning Research into Economic Competitiveness for SA inquiry notes the Adelaide/UniSA merger “could create a catalyst for broader cultural change in the merged institution, making our suggested reforms more likely to succeed”.

“The merger could also potentially create cost savings, for example through removing duplications of assets, enabling more efficient use of facilities,” the report says.

“If any such savings were used to fund applied, industry-focused research in the spirit of our reforms, then the potential for universities to drive improvement in the state’s economy would be further enhanced.

“Even if a merger does not proceed, by focusing stakeholders on the greater economic role the universities could play in the SA economy and society, the process has served a useful purpose.”

South Australian Productivity Commission chairman Adrian Tembel. Picture: Hollie Adams/The Australian

The report recommends legislation changes to prioritise universities’ commitment to an economic and social impact on SA, in addition to high-quality education and research.

It also recommends a University Reform and Growth Fund to “incentivise and directly support economically significant reforms”, which “could include merger reform”.

Mr Malinauskas in July announced a state funding package to back the Adelaide University merger that included a $200m pool to support research.

The Liberal Opposition, which Mr Malinauskas hopes will support law changes needed for the merger, has demanded clear details of the plan’s cost to taxpayers and economic return to the state.