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campusreview.com.au
‘Not going broke’
La Trobe denies ‘going broke’ as
unis face $16 billion shortfall.
La Trobe University has hit back at
claims that it’s “at risk of going broke
in a matter of weeks”.
In a recent article, The Age reported
that the university was in dire straits – with
cash reserves reduced to the minimum
required to meet a single month’s operating
expenses – unless it secured a financial
lifeline from the banks and an agreement
from staff to cut wages.
In a statement, La Trobe said the “broke”
line was incorrect.
“The university is not at risk of
going broke,” it said, adding it was in
ongoing discussions with its three banks
for increased facilities needed in the
short term.
The article was based on vice-chancellor
Professor John Dewar’s presentation to
staff on the university’s financial situation.
Dewar detailed the need for the Australian
Universities Job Protection Framework,
telling staff that without it the university
would have to make positions redundant
in order to balance the books.
“Without it, we will need to borrow
significantly to cover the costs of
redundancies, which will saddle the
university with more debt than would
otherwise be the case, assuming we are
able to extend our borrowings,” he said.
Later Mark Smith, the university’s chief
financial and operations officer, told staff
that La Trobe was looking at a $400 million
to $520 million revenue variance to 2022.
Smith said the university has made cost
savings of $87 million in 2020 and expects
to make $70 million in 2021 and $50 million
in 2022, and that its voluntary redundancy
program will deliver savings of $20 million
in 2020 and $40 million in 2021 and 2022.
He added that the job protection
framework measures are expected to
deliver savings of $16 million in 2020 and
$32 million in 2021.
Still, the university will run at a loss
this year.
And it’s not alone – Universities Australia
has warned that the nation’s institutions
could lose $16 billion in revenue between
now and 2023.
The peak body’s chief executive, Catriona
Jackson, said the sector can’t pretend that the
coronavirus pandemic won’t have a big impact.
“Until now, universities have been
increasing their investment in research and
innovation,” Jackson said.
“The danger is that if universities are
unable to continue funding this activity,
Australia’s ability to innovate its way out of
the COVID-19 recession will be severely
hampered. You can’t have an economic
recovery without investing in research and
development.” ■
300 jobs to go
Deakin VC flags job losses as
unis sidestep union deal.
Deakin University’s vice-chancellor
has flagged with staff that hundreds
of positions will be slashed as the
university maps out the economic damage
of the coronavirus pandemic.
In a town hall meeting, Professor Iain
Martin said the institution would not sign up
to the National Tertiary Education Union’s
job protection framework and instead was
looking at 300 redundancies and cutting
100 vacant positions.
Martin said the union’s framework would
constrain Deakin’s ability to decide what’s
in the best short, medium and long-term
interests.
“Our recovery from the COVID-19
pandemic is not going to be a V-shaped
one,” he added.
“The approach we are proposing,
combining debt and cost savings, will
ensure that Deakin is in the best position
to preserve as many jobs as possible in the
medium term, rather than simply seeking
to get to a notionally balanced budget over
the next 12 months.
“We have an enterprise agreement that
underpins the vast majority of employment
contracts at Deakin, and we see no need
to change this to enact measures included
in the framework such as stand‐downs,
forced leave, forced reduction of hours,
across-the-board pay cuts of up to
15 per cent and deferral of incremental
progression that we have no desire to
implement.”
Deakin expects its operating revenue
to fall by between $250 and $300 million
in 2021.
Martin said: “As a university, we spend
55 per cent of our total revenue on staff.
While we will do everything possible to
minimise staff impacts, we must look at our
employment costs as well as continuing
to minimise other expenditure to adjust to
where we need to be.”
Deakin’s NTEU vice-president Stephen
Davis said the university’s workers were
“collateral damage” in efforts to meet a
balanced budget.
“It’s incredibly disappointing that the
university has chosen to sack people like
this,” Davis said.
The union’s national office said the move
could have been prevented if the minister
for education, Dan Tehan, made JobKeeper
available to university workers.
NTEU’s national president, Dr Alison
Barnes, said: “The government found $60
billion behind the couch on Friday and on
Monday more than 300 people are going
to be out of work.”
Deakin said it would have a staged
approach to staff reductions.
“I acknowledge again that managing
2020 and the next 2–3 years is about far
more than money, but without a solid and
sustainable financial position we will not
be able to make the impact-generating
contributions that will be needed across our
communities,” Martin said.
Deakin is not alone in its decision to
sidestep the union’s deal. At least 17 other
universities have turned it down. ■
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