(This is a note prepared for the Legislative Council's Inquiry into the Provisions of the University of Tasmania Act 1992)
Introduction
The recent
tabling of UTAS’ 2022 Annual Report is an opportune time to have a close look at
UTAS’ current situation.
Rather than
just a snapshot of one year’s financials, a few past years will provide a
better basis to form a view of how UTAS has arrived at where it is now, and
what this means for the future.
The
following note is based on UTAS’ financial statements since 2015. It is not a
management accounting exercise looking at costs, revenues and student numbers
etc, for that is outside the Committee’s Terms of Reference, rather an
explanation of UTAS’ overall financial situation.
UTAS’ net profits are very volatile.
Stripping away capital grants and
investment income however leaves a more sedate picture.
Unfortunately, all that’s left are
losses, losses from the core activities of teaching and research, and losses
caused by a relentless pattern of what UTAS describes as restructuring costs.
It’s not so much that UTAS’s buildings
may no longer be suitable, but its current financial model is not fit for
purpose.
The gobsmacking reality which UTAS
has kept hidden, is that deficits from core activities have been funded by
investment income, which inevitably will fall as investments are redeemed to
fund the Hobart CDB move.
If as UTAS has suggested, the prize at the end of the day is only $200 million once the Sandy Bay assets are monetised (as consultants term it) and the development costs in the Hobart CDB paid for, how will deficits from UTAS’ core activities be funded?
