Summary:
The first five years of Prof Black’s
tenure has delivered $117 million in losses from the core activities of
teaching and research including the relentless pattern of restructuring costs
as UTAS struggles with declining real revenues and increasing costs. Capital
grants of $227 million included as revenue help hide the losses.
Declining cash flows have accompanied
the reduced profits to such an extent that 2023 saw UTAS with negative cash
earnings for the first time in 2023, with no discernible plan to rectify the
mess.
This means operations are unable to
service the current level of borrowings.
Servicing existing borrowings as well as all new capex requires running
down existing cash and investments until there’s no option but to start selling
the family jewels, parts of the Sandy Bay campus.
At the rate of capex spending
undertaken in 2023, UTAS only has another two years before the cash tin runs
dry, which will not be enough time to make core activities sustainable once
again.
The primary focus should be on arresting
the decline in earnings from core operations. Moving to Hobart will only defer
and exacerbate the problem. Building STEM facilities with a sale and leaseback
arrangement won’t fix negative earnings from the core activities of teaching
and research.It’ll make it worse as any investor/lessor will want a rate of
return well in excess of the rate at which UTAS could borrow, if only Treasurer
Ferguson will approve an increase in UTAS’ borrowing limit. UTAS knows this but
sheer bloody mindedness has led it to deliberately pursue the reckless course of
taking UTAS to the brink of insolvency, by trying to force the hand of the Parliament
and the government to allow it to sell parts of Sandy Bay so that it can
continue with its vanity project whilst ignoring the wishes of most other
stakeholders.
Prof Black
has recently railed against the inadequacies of Tasmanian schools’ performances
notably the numbers who make it to Year 12. It may be a heart felt concern, but
in part is likely to have been a reflection on the lack of students moving on
to UTAS. Prof Black called for an inquiry into Tasmania's education system. Any inquiry should require a closer look at UTAS.
However less than expected numbers of Tasmanians wishing to study at UTAS
must be in part due to mainland universities being able to attract the best and
brightest, those who can afford it and those wishing more face-to-face learning
and/or a more communal/collegiate setting than lesser quality offerings in a
traffic congested city.
If the edu-migration international student Ponzi scheme was virtually
over even before it started, no doubt ably assisted by the Covid virus, how
long will the current plan last?
Even the mildly sceptic would
question if UTAS racks up $117 million in losses from core activities over five
years what are the odds of it pulling off a much riskier project like the
Hobart move? If it doesn’t who’ll be left holding the can?
Isn’t it time to take a deep breath.
The government and the Parliament
need to show who’s boss. Prof Black or the people of Tasmania?
What the 2023 Annual report revealed:
The 2023 year was by far the worst of
the five years since Professor Black assumed the role of Vice Chancellor of
UTAS.
