University of Southern Queensland’s budget black hole revealed

Insiders at a meeting open to staff at a regional Queensland university have revealed the key federal government change that its executive claims has forced large cuts to spending.

UniSQ Acting-Vice Chancellor Karen Nelson.

The dire state of the University of Southern Queensland’s finances were revealed at a meeting on Thursday, where staff were told job cuts would not be enough to bring the organisation back into the black.

University executives told staff back-to-back operating deficits after the past three years amounted to $78.6m, which has drained the university’s cash reserves.

According to staff who attended the meeting, Acting Vice Chancellor Karen Nelson said Ministerial Directive 107, which slowed the processing of international student visas, resulted in a student drop of about $20m in revenue for 2024.

This directive was brought in earlier this year and ranks universities from one to three, based on their record of enrolling international students who are genuine and can prove they have the savings to pay their tuition and living expenses while in Australia.

Material leaked to the Sydney Morning Herald showed UniSQ had a level 2 ranking.

Professor Nelson told the meeting that this was something no one could have predicted.

She said the executive had a plan to address the deficit but it was grossly disrupted by (MD107), and it assumed they would have more international students.

Staff said Professor Nelson told the meeting that new international student enrolments had dropped to about 370 in 2024.

She added the executive was saving money by holding vacant positions, restricting vehicle packages as part of salaries, limiting catering for internal events and slashing travel expenses.

The university is also expanding into full-fee paying short courses in the crowded Brisbane market, along with encouraging more students to take up classes in trimester three, to boost course load.

While everyone at the meeting was there to hear more about looming job cuts, Professor Nelson said she could not confirm the details until December as the executive worked through a consultation process.

The meeting was told that UniSQ had the highest salary cost as percentage of revenue of all Queensland universities.

It sat at 70.7 per cent in 2023 with the next highest being Griffith University at 60.8 per cent, followed by Queensland University of Technology at 55.6 per cent.

Professor Nelson told the meeting that redundancies were not going to be enough, and that UniSQ was “in cycle of change.”

Lots of questions, no answers

One senior academic who attended the meeting told News Corp Australia staff were frustrated with the lack of detail around job cuts.

The academic wished to remain anonymous out of fear of losing his job.

“After months of upheaval, job cuts, and a recent vote of no confidence, we thought this would be the moment for the UniSQ leadership to finally face us and answer our questions,” he said.

“Instead, we got PowerPoint slides, finger-pointing, and a monologue about everyone else’s shortcomings — perhaps even ours for not working hard enough — not theirs.

“We were presented with a familiar pitch: a plan to cut costs by reducing the percentage of the budget spent on staff to be more like Queensland’s larger universities.

“But as a regional institution, UniSQ can’t simply replicate the efficiencies of metropolitan universities without compromising our ability to serve our community.

“The relentless pursuit of “efficiency” seems to only translate to job cuts and erosion of resources, with no sacrifice from those at the top.

“It’s not just our jobs on the line but our right to challenge, to ask questions, to demand transparency. This university is ours as much as it is theirs, and we have every right to expect our voices to be acknowledged, not dismissed.

“If the VCE thinks that a few token Q&A sessions across campuses will quiet us down, they’re mistaken.”

Visas only part of the problem

The executive’s claim that MD107 was to blame for the budget black hole has been disputed by Claire Field, a former regulator who now works as an independent consultant for the tertiary sector.

She said the directive brought increased Department of Immigration scrutiny of student visa applications, scrutiny that had previously been entrusted to the sector.

As a result, the department was finding a higher rate of student’s families engaging in dishonest practices to secure visas, such as pooling money and moving it between bank accounts within extended family networks, so that more children could qualify.

It also brought about more strenuous tests for English competencies.

“To manage the workload of this process, the directive said property was to be given to the lowest risk providers, so it takes longer for a UniSQ visa to be processed than a University of Queensland visa,” Ms Field said.

“Across the sector there has also been a higher level of visa rejections.

“Those investigations require really deep expertise to detect irregularities, and require trusted relationships with education agents in other countries.

“Some Australian universities have been a bit naive in terms of the agents they are partnering with.

“The government is concerned that the students who can’t afford to study might be coming for work reasons instead.

“With even a part-time job in Australia they can earn more than they would at home.”

Ms Field added that UniSQ also had a domestic problem, with new undergraduate enrolments down 26 per cent in 2024, and post graduate enrolments down about 22 per cent.

For this she blamed the Morrison government and its Job Ready Graduates Program, which increased the cost of arts and humanities degrees to push students into STEM subjects.

“This is outside the university’s control,” she said.

“Students in regional Australia are less wealthy, they are really concerned about taking on large student debts, especially now that banks are now taking that debt into account for mortgage lending.

“It is turning some students away from university.”

Originally published as University of Southern Queensland’s budget black hole revealed