16
Nov
2015

Q&A Budget Update 2015/16

Getting the budget so late makes it difficult to plan.

Historically ANU has not presented its budget to Council until December. Last year, we did get the budget done earlier (in October) for the first time.  This year we had planned to have the budget finalised by October to flow through to School’s by November – unfortunately we have lost time because Council did not approve the budget. In the future we would like to see the budget approved by November to allow areas to plan better. The current situation is very undesirable but we will continue working towards getting the budget finalised earlier.

What plans can you implement to improve this situation?

For the future we hope to have the budget to all schools and service divisions by November. We are working to improve the process to harmonise the way that colleges allocate funds to the schools.

Where is the main area for savings?

In broad terms there will be a $4 million savings in professional staff costs, $2 million in academic staff costs, and $1 million in other operating costs. While staff numbers grew in 2014 they remained stable in 2015 and we don’t expect to need for a major cut in staffing numbers.

We will spread the professional staff savings evenly across the service portfolios and the Colleges.

In the first six months of 2016 we will be having a more strategic look at the entire budget model.

Have you been too conservative in your international student revenue estimates?

We think international student revenue will grow by six and seven per cent due to fee increases. Load increases are unlikely to grow significantly enough to improve revenue. At this time, acceptance numbers are still very small and the data is currently insufficient to predict growth. At this time last year applications and offers were up significantly but they didn’t translate to enrolments.

The University of Canberra has managed to get their budget into surplus. Why is there such a difference between the ANU and UC budgets?

UC is in surplus because they did some significant and fairly drastic cost cutting across their institution in 2009. They outsourced a lot of their administrative functions and significantly reduced their expenses.   This has provided them with a better structural platform for financial performance.

Over recent years, ANU has outperformed UC in terms of student growth.

Why is IT so expensive at ANU when compared to other universities?

There is a lot of duplication in the IT space. ANU has the most decentralised IT out of all of the universities we measure ourselves against. Most other universities are centralising their IT to reduce duplication and improve efficiencies.

When will recruitment targets be set for 2017 and 2018?

When the new VC begins next year he will revisit the strategic plan for the University – from that plan we will have a better picture of the targets for 2017/18.

What is the long term plan for the library given the Australian dollar is unlikely to improve?

ANU will need to top up the budget for the libraries to ensure we can continue to have a fully functioning and well-supported library. The library collection is one of the most powerful assets of the University and provides invaluable support to our researchers and students.   While we have invested an additional $600K in 2016, we will see if we can make further improvements in the 2017 budget.

What was the impact on the ANU budget following the University’s decision to divest in seven companies as part of its socially reseponsible investment policy?

The decision to divest had a significant positive financial impact due largely to the major drops in the share prices of the seven companies from which we divested, post our divestment decision. The University is currently reconfiguring our Australian equities portfolio and we are introducing a tilt that is aimed to reduce the carbon footprint of our share portfolio.

Are the reductions in research funding expected to be long-term?

The long term outlook for research funding from the government is not great. ARC funding has been constrained over recent years and that has been an area of funding that we have relied on quite heavily. We have not performed strongly in research funding from the NHMRC.

Our other source of research funding has traditionally been due to collaborations with the Commonwealth Government. With the government tightening their belt over recent years we have seen that pool of funding diminish as well.

To improve our research funding we need to both improve our success rate with NHMRC and also improve our collaborations with industry and the private sector.

What recognition in the budget is there for upgrades to IT to support student services and facilities?

ANU allocates around $6 million each year to upgrade and enhance our IT. Half of that next year is allocated to IT improvements in the student space. WIFI in the student residences and teaching spaces is being upgraded significantly over Christmas and once complete there will be an additional 2,200 access points.

Where does all of this leave the Union Court proposal?

Union Court is an idea. We don’t have the money to upgrade Union Court and whether we can afford it and the rate at which we can do these things is still very much being discussed. It’s important to understand that funds to upgrade Union Court would be sought from private investment and Union Court has so far had no impact on the operating budget of the University.

 

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Updated:  16 November 2015/ Responsible Officer:  Executive Director Administration & Planning/ Page Contact:  SCAPA