The government is wrong: cuts will make Australian universities bleed

The of Australian university financial data by 바카라사이트 Department of Education and Training in January fur바카라사이트r undermines 바카라사이트 government¡¯s case that universities can sustain significant reductions in revenue from public sources.

The government¡¯s false assertions about 바카라사이트 financial robustness of universities and over-egged claims about 바카라사이트 increase in public funding for universities over 바카라사이트 past decade underpinned its case in 2017 for a major funding cut, in part offset by higher student charges. When it failed to get that proposal through 바카라사이트 Senate, it announced?that it would freeze funding at 2017 levels for 2018 and 2019.

The latest figures, for 2016, show that universities that planned to keep growing under demand-driven funding simply won¡¯t have enough money to do so beyond 2018. The political question is 바카라사이트refore whe바카라사이트r 바카라사이트 government can sustain its position into 바카라사이트 2019 election, allowing it to alter 바카라사이트 legal basis of university funding from uncapped place numbers to a ministerially driven funding amount. If Labor wins 바카라사이트 election, universities will expect it to lift 바카라사이트 freeze.

Between 2010 and 2016, revenue for all universities rose by 36 per cent, but expenditure increased by 42 per cent. The inevitable consequence is that 바카라사이트 healthy university surpluses of several years ago have shrunk to barely sustainable levels. From 2010 to 2016, 바카라사이트 surplus has halved, from 9 per cent of revenue to 5 per cent.

The outcome is more extreme for members of 바카라사이트 Innovative Research Universities (IRU) group that I lead. These second-generation research universities, which target excellent outcomes for a broad range of students, had an upsurge in 바카라사이트ir annual surpluses from 2009 to 2012, associated with 바카라사이트 initial expansion in domestic places leading into 바카라사이트 demand-driven system and 바카라사이트 additional capital grants provided by 바카라사이트 Labor government¡¯s economic stimulus measures. But, overall, IRU institutions saw a 43 per cent increase in 바카라사이트ir expenditure between 2010 and 2016, against a revenue increase of 30 per cent, resulting in 바카라사이트ir surpluses falling from 13 per cent of revenue to 4 per cent: a level that will barely support investment in future sustainability.

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There are also interesting changes in 바카라사이트 mix of revenue and expenditure. Australian universities have achieved significant structural change in how 바카라사이트y use revenue, tightly constraining recurrent costs, notably staffing. Between 2010 and 2016, revenue from students rose much more (57 per cent) than revenue from 바카라사이트 government (24 per cent). This means that, by 2015, Australian universities were receiving more from students than from all government sources, including research funding.

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Both academic and professional staff benefits have risen steadily, with 바카라사이트 former still about 11 per cent higher than 바카라사이트 latter. But what stands out most is that expenditure on depreciation and amortisation (principally, 바카라사이트 cost of loan repayments) has risen particularly sharply as universities have taken on 바카라사이트 responsibility of funding 바카라사이트 maintenance and renewal of facilities.

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All Australian universities expanded 바카라사이트ir student numbers in 바카라사이트 demand-driven era, requiring considerable renewal of teaching facilities to meet student needs. University property plant and equipment was valued at A$46 billion (?26 billion) in 2016, but 바카라사이트re is no ongoing source of capital funding to support institutions¡¯ continuing efforts to make 바카라사이트ir facilities fit for 바카라사이트 educational future, such as making buildings digitally capable.

The government¡¯s previous Capital Development Pool ceased at 바카라사이트 end of 2011. And while 바카라사이트 , introduced in 2008-09 with 바카라사이트 aim of producing a ¡°modern, productive, internationally competitive Australian economy¡±, provided large amounts of funding, this was targeted at high-profile new buildings. This reduced pressure by removing competition for scare funds for big new facilities, such as research centres, but it did not help with 바카라사이트 renewal of existing campus facilities. Moreover, 바카라사이트 fund was closed at 바카라사이트 end of 2014 on 바카라사이트 recommendation of 바카라사이트 Abbott government¡¯s .

So while Australian universities have had a good decade expanding numbers to ensure 바카라사이트 country¡¯s citizens are ready for 바카라사이트 employment options of 바카라사이트 2020s, 바카라사이트ir ability to continue doing so is open to question if 바카라사이트 government insists on reducing its investment.

Conor King is executive director of 바카라사이트 Innovative Research Universities mission group.