Opinion: Victoria University Wellington – Te Herenga Waka is proposing to eliminate as many as 260 jobs to balance a $33 million shortfall. This news follows reports of similar redundancies at the University of Otago and AUT. 

At one level this is not surprising. New Zealand universities are chronically underfunded (with funding not keeping up with inflationary pressures in recent times) and excessively reliant on foreign (primarily Chinese) students. So, when the borders were closed at the start of the pandemic little wonder universities suffered.

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This has ramifications in several dimensions. Education is the fifth largest export item for New Zealand, and it is quite possible the Government has hobbled this sector. 

During a recent visit to Otago, the Prime Minister claimed: “The universities make their own decisions about how they manage their finances so it’s not something that we can intervene with.” 

Really? To the best of my knowledge, vice chancellors are required to maintain a 3 percent operating surplus, and surely, this operating surplus is part of the shortfall that the universities are reporting. That “universities make their own decisions” seems somewhat contradictory given that part of this shortfall is because of the border protections and the restrictions on the intake of foreign students. 

When they shut down our borders, our Government may have thought that all the overseas students would simply wait their time, that they would come rushing back once the borders were reopened. This was never going to happen, and it didn’t. Universities are now faced with a precipitous drop in international enrolments. Overseas students have voted with their feet, choosing other destinations. 

According to public information, in 2021 Victoria University had revenues of $518m and operating expenses of $496m – a surplus of $22m. Clearly revenues are down, but 3 percent of approximately $500m is $15m. Victoria claims a shortfall of $33m. Does this shortfall include this $15m of operating surplus? If it does, then the actual shortfall is potentially lower. 

Victoria could quite legitimately argue that under these extraordinary circumstances the 3 percent surplus requirement should be waived by the Government.

New Zealand is now falling further behind our Australian counterparts in terms of everything, including the recruitment of high-quality academic staff (because of our lower salaries) and in research funding (because of the extreme paucity of government funding in this area). This has consequences, not just for the university sector and its employees, but for research and development, for innovation and for our general standards of life. 

Universities in other developed nations are often incubators of new ideas, entrepreneurial activities and businesses. In New Zealand we have stopped aspiring towards these goals. 

But, though our universities’ fortunes are certainly being held hostage by the lack of vision of our governments, I’d argue that some of the wounds are self-inflicted. Let us count the deans and vice chancellors of various types at Victoria now. I predict that after the restructuring and the redundancies, that number will either stay unchanged or increase.

Though our universities are ostensibly in crisis, and in the process of cutting front-line academic and non-academic jobs, all universities have seen an increase in the layers of management.

The internal dynamics of our universities have devolved into a battle for surplus between regular staff and management. 

We know a key indicator of student success is the staff-student ratio. Adding managers while cutting frontline staff makes the ratio worse. 

The inevitable consequence of this increasing managerialism at universities is that decisions are being made by those far removed from the coalface. What to teach? How to teach? How to assess students? How to deal with the sharp decline in attendance since the Covid pandemic? 

High-quality teaching matters. Providing students with good pastoral care matters. There is nothing more important to stimulate young minds than to present findings and arguments from one’s discipline with energy and enthusiasm or to convince them that they matter, that their concerns and worries matter. 

The current situation is leading to a devaluation of the degrees from our universities. I routinely talk to school students, particularly Year 13 students, about future study and career options. I have routinely told them there is little point in going across the ditch to study at an Australian university when they can stay here and get an equally good degree at much less expense. It is getting harder to say this with a straight face. 

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