University Research Infrastructure: Sydney University Vice-Chancellor Gavin Brown Makes a Point. (June 17, 2007)

    In a little over a year the Vice-Chancellor of The University of Sydney will retire from the fray.

In the winter edition of the Sydney Alumni Magazine Professor Brown makes a quiet statement that speaks volumes:

    The challenge of developing new infrastructure is a big, if not the biggest, problem for every research intensive Australian university. The first part of the difficulty is that competitive project grants do not carry institutional overheads. Thus the figure of around $120 million that we win in project grants is fully expended by the individual researchers and, indeed, requires institutional cross-subsidy from other sources. We have a comparable sum from the competitive block grants which partly helps with that, but a large proportion of funds is devoted to research training. Moreover these block grants can be expended only on personnel and equipment not on the laboratories which house the activities.

 

This means that for a leading research university, research is a budgeted loss leader, essential to our prestige and mission but dependent on other support.

 

Because research underpins the quality of the environment for all students it is reasonable that fees help contribute to establishing infrastructure. It is interesting to compare our budget in 1997,my first year as Vice-Chancellor, with 2005, the last fully audited year.

 

In 1997 the government operating grant was 40 per cent of budget rather than 18 per cent as now. In 1997, student fees accounted  for 20 per cent, now they account for 33 per cent, but the HECS amount from Australian government subsidised places was 12 per cent as it is now. Thus private enterprise funding from student fees have moved from 8 per cent to 21 percent. International student income has moved from $27 million to $140 million. The largest increase in student numbers has been in the postgraduate area.

 

As I noted in a speech in Taiwan recently, Australian universities are probably the toughest budget managers in the world. We must ensure that is not a curse!

It's worth while recalling here a 5^th of June News and Views from TFW.

The Financial Review reported yesterday that seven of our eight sandstone universities have a "combined surplus of $472.6 million for 2006 - up $130 million on the previous year".

 

And as for Ms Bishop?  "The evidence challenges the credibility of claims of under funding."

 

And as for the chairman of the Go8, Glyn Davis, University of Melbourne V-C? "The operating surplus is the only means of transferring revenue for asset-replacement purposes," and once again made the point that asset replacement costs have now mounted to a staggering $17.1 billion for the Go8 and $35.1 billion for the whole sector.

 

According to the Fin Review Ms Bishop decried the universities' requests for more funding increases on top of the $5-billion endowment announced last month in the federal budget.

 

Of course she overlooked her previous public utterances that there would be consequent reductions in block funding grants as the HEEF's interest payments came to fruition, to say nothing of the fact that $472.6 million is about 2.8% of the funds needed for asset replacement for the Go8.

Toujours gai.