Uni finances improve due to building delays, more enrolments

Waiting to hear about funding

THE University of Otago’s finances are in good shape due to extra enrolments in the first semester and delays to building work, its latest financial report says.

The building projects include a new multimilliondollar music and performing arts facility.

A report prepared for Tuesday’s university council meeting said the operating surplus for the first five months was $5.8 million higher than the budgeted $110.9 million.

The primary reasons for the rise were ‘‘higher enrolment numbers than budgeted’’, and cash balances from delayed capital projects.

In March, the university reported 322 equivalent fulltime students (EFTS) more than the same time last year.

Enrolments were expected to climb by a further 1100 EFTS by the end of 2018. However, updated enrolment numbers will not be available until later in the semester.

Projects that had experienced delays included the $26 million music and theatre complex, which will be situated beside the Robertson Library in Union St East.

A university spokeswoman said tenders had been evaluated, and a recommendation for the award of a building contract was being completed.

The original timeframe for completion of the building was the middle of next year, but it was now expected to be complete by the end of 2019.

The university was left with $189.6 million cash on hand at the end of May, $71 million more than budget.

Income from student fees totalling $10.3 million due to increased enrolments and ‘‘earlier receipts due to the fees free scheme’’, was one of the factors which made up the difference, the report said.

A spokeswoman said 3455 students were enrolled on the Government’s feesfree scheme. However its effect on enrolments was still relatively unknown.

OTAGO Polytechnic is still bucking the trend of declining enrolments in the sector, with nearly 400 students more than expected enrolled for the second semester — but is waiting to hear whether its funding allocation will be increased.

A report prepared for a polytechnic council meeting today said enrolments were 4939, compared to the the estimate in the budget of 4573.

The Tertiary Education Commission was meeting the polytechnic this week to negotiate funding for the next year.

The total roll for the second semester was due to be at least 106% of the expected target, but deputy chief executive for corporate services Phil Cullen said it could climb as high as 108% or 109%.

How much funding the polytechnic would receive for the extra students depended on the performance of the rest of the sector and whether other polytechnics were meeting their allocations, he said.

‘‘We believe that there are two or three that are like us, but then there’s others that are lagging behind.’’

The polytechnic’s report for the financial year to May 31 said the institution was in a financially healthy position.

Net assets were $8 million higher than budget, with strong revenue from student fees, and the sale of City College, combined with lower outflows and the conversion of other working capital items to cash.

Polytechnic chief executive Phil Ker said the numbers were ‘‘extremely strong’’, and he believed the polytechnic had not been affected by the downturn in the rest of the sector because a ‘‘significant proportion’’ of enrolments were from people already in jobs.

In times when the economy was strong, there was usually a decline in enrolments as people opted to take jobs rather than go back to gain more qualifications, he said.

Otago Polytechnic’s enrolments were up by 8.2% at the start of this year, but the feesfree scheme did not have the expected effect because of the timing of enrolments.

Mr Cullen said the polytechnic had a ‘‘historical pattern of overachieving’’ over the past few years.