For those of you who have forgotten the Budget Solutions Forums that were held in June last year, this article may just remind you of what it’s all about. It is an account of one of the two Forums held for staff over the break, which served as an update on the progress of various measures implemented as part of Budget Solutions.
While students were on their holidays, ANU Staff attended the the Budget Solutions Forum on Thursday, 26th of June, at 12:30pm. The Law Link Theatre was filled beyond capacity with over one hundred people attending. Extra chairs were brought in but a few staff had to remain standing.
The Forum was hosted by Chris Grange, Executive Director of Administration and Planning, in charge of developing and implementing Budget Solutions, which began in June 2013.
The purpose of the forum was to give university staff a progress report on the implementation of Budget Solutions, the resulting outcomes thus far, and to give staff the opportunity to ask questions with regard to Budget Solutions.
This included an update on ANU’s financial outlook. Grange reported a $19 million surplus. This is a significant improvement from projections in June 2013 that expected the university to make a loss of $6 million.
The surplus is attributed to several factors. This included an improvement in investment markets and an increase in bond rates in the second half of 2013. An additional $6 million of funding from the ‘China in the World Program’ contributed to the surplus.
Finally, the cost of early-retirement schemes had been overestimated by several million dollars. The number of early-retirements by academics had also been overestimated.
This brings ANU’s deficit to $4.5 million for 2014, a dramatic improvement from the $30 million deficit that was projected in June 2013. Grange states that small surplus is expected in 2015 but is contingent upon maintaining the growth in student numbers, not losing the benefit from staffing reductions and on investment market conditions of the next financial year.
No projections have actually been calculated for 2015 and Grange says that he is “somewhat at sea” and merely “putting a finger to the wind.”
OVERVIEW OF THE OBJECTIVES OF BUDGET SOLUTIONS
Budget Solutions 2013 had four main objectives:
1. To increase revenue
2. To find savings in non-salaries areas
3. To find savings in salaries and employee expenses
4. To reform and improve administration and administrative processes
INCREASES IN REVENUE
Increase in revenue was mainly generated by an increase in student numbers. There was a net increase of 1.5% in the domestic undergraduate student load and a 3.9% increase in the international undergraduate student load. The domestic fee-paying student load grew by 10%.
Other sources of increased revenue included the parking fee increases, which generated an additional $800,000 in revenue, and the implementation of a 2.5% overhead charge in trading units for student accommodation and University House.
SAVINGS IN NON-SALARIES AREAS
Savings in non-salaries areas reported mixed results. The ANU successfully renegotiated its electricity contract, saved $750K/annum, but failed to satisfactorily reduce electricity consumption. Only a 2% reduction was achieved.
Furthermore, the ANU needs to pay an additional $2 million due to increases in workers’ compensation premiums, as announced by ComCare in April. This increase in premiums is attributed to the growing cost-structure of all Commonwealth liabilities, which induced ComCare to increase premiums across the board.
SAVINGS IN SALARIES/STAFFING RELATED MEASURES
An early-retirement scheme for academics over 55 and a staff-freeze imposed in July 2013 were implemented as dual measures to reduce staff members.
Grange reports a “solid take-up rate” for the early-retirement scheme with 166 academics retiring. Grange reports that the early-retirement scheme was not a savings measure but a measure to bring new people to the ANU.
The staffing-freeze resulted in a reduction of 55 administration staff. The staffing-freeze was lifted last month but Grange warns that this does not mean an “open slather” for increasing staff numbers again.
A cap in staff members is being negotiated with the Deans of all ANU Colleges. The cap will most likely be on the proportion of college expenditures on administrative salaries compared to all other salaries.For non-College departments, such as IT and Human Resources, their respective budgets will effectively be their cap on professional staff.
Moreover, a 75% reduction to the number of staff who have accumulated more than 40 days of annual leave was achieved. Budget Solutions will implement a similar reduction for long-service leave, but staff have been given more notice with this regard.
Grange acknowledges that there is “a general sense of pressure” that has been induced by staffing reductions and gaps left behind by retiring academics that have not yet been filled.
As Grange states, “You can’t lost ten percent of your professional staff without improving processes.” affirming the need to streamline processes to make life more tolerable.
Administrative reforms included moving student acceptance and enrollments online, with 90% of account transactions done over the internet. Seven more administrative reform programs will be delivered by the end of this year. These include:
– a new university wide budgeting tool
– improvements to the staffing recruitment procedure
– a new online parking management system for online purchase of permits
– introduction of online digital records
– a roll-out of data warehousing for student information and demographics
A restructuring of administrative burdens across schools, colleges and the centre will be discussed at a Senior Management Group retreat in ten days time.
On the question of improving administrative processes, Grange took the opportunity to thank staff for suffering the pain and pressure of cuts and reductions. He also reiterated that the pressure has been applied equally in all areas of the university. Grange praised “the goodwill” between colleagues, which he states as being “better than what it’s been historically.”
On the question of fee-deregulation, Grange states, “[The ANU] stand, on balance, to gain more as a university through the deregulation process.” Forums on the issue of fee-deregulation will be held in the coming months.
Grange took a question on the upcoming capital works to explain the funding for the four new major projects, announced last month. The four capital works projects are: a new Maths and Computer Science Building, a new building for the Research School of Social Sciences, a refurbishment of the Robertson building and a first-stage redevelopment of the Physics precinct.
No new money is being used to fund new capital works projects. Money that was previously given to each college has been pooled together by the Deans into one central pool to fund these projects.
Cam Wilson, President of ANUSA, asked Chris Grange if there will be a similar forum run for undergraduate students. Grange has taken this matter “on notice” but has yet to confirm.
Photograph by Abigail Widijanto.