Got those university blues

LEFT unchecked, pessimism and melancholia can spread easily to those who might otherwise have a more sanguine outlook.

In a city the size of Dunedin, and a region the size of Otago, news that one of its most important mainstays is in trouble affects everybody.

Revelations concerning the University of Otago, its financial plight and the way its senior management team and council members have handled the predicament are still reverberating around the region. Not only are they upsetting for all in the South, but also they bring into sharp focus the importance for the country of a robust future for this most historic institution.

Few people in Otago would not have at least some thread of connection to the university. As New Zealand’s oldest, and arguably most wellknown and respected centre of academic rigour, research and teaching, its influence extends across the country and the world.

But it’s all bad news these days, played out against the backdrop of a university sector in turmoil, underfinanced for years by governments which claim it is not their job to interfere in how universities choose to operate.

It is Otago University especially, because of its formidable reputation, which seems to be caught in the headlights.

Recent disclosures in this newspaper of the state of affairs at the university show how shambolic some of the decisions and actions from the top appear to have been. Perhaps the most alarming was the discovery that university leaders deliberately chose not to tell staff, students and its broader community in November last year about the gap in its 2023 operating budget.

Instead, acting vicechancellor Prof Helen Nicholson only revealed the extent of the alarming financial situation in April, saying it had worsened and there was now a need to save $60 million from annual running costs.

The university knew last year things were bad. The 2023 budget prepared last November omitted details that $25 million in savings were needed to reach a 2023 yearend operating deficit of $12.4 million.

An overall $37.4 million shortfall had already been recognised by the leadership team and the council, yet the publicly available published budget made no mention of that savings plan, only mentioning the $12.4 million deficit and saying the university envisaged ‘‘a steady return to more normal operations’’.

That budget also referred to savings of $12.8 million in salaries and related costs but did not explain how this would be accomplished, not that this was part of a bigger savings target. Asked about the key omissions, chief financial officer Sharon van Turnhout said senior managers decided not to include the savings target of $25 million while they worked out how to achieve it.

We are still waiting to be told how the university will achieve its larger target of $60 million savings per year to get back into the black.

Financial statements obtained by the for the first three months of this year show the university is now about $10 million worse off, due to lower student numbers than predicted, with a forecast deficit of $22.5 million, still based on the $25 million savings being achieved. This is only half the woeful financial picture, with essential building works meaning the university will struggle to get out of debt.

As breathtaking as this position is for a publicly funded institution of Otago’s heft, Prof Nicholson told hundreds of anxious staff they needed to be both more positive, despite potentially several hundreds of jobs being cut, and to ‘‘perhaps not read the too much’’.

The university was in a ‘‘downward spiral’’, she said, with its rankings falling during the past four years. She then stunned some by claiming cuts to the number of university papers were justified because, since the Covid19 pandemic began, too much choice made students anxious.

It is understandable that, faced with such financial chaos and angry staff, the university’s leadership team might feel lost and overwhelmed. But that is why they are paid big money.

Journalists and media organisations are well used to being cast as irresponsible by those who would rather bad news not see the light of day.

But to reframe looming course cuts to employees as a good thing, because they might make students less apprehensive, is nothing other than gaslighting.