University of Otago Vice-Chancellor Sir Professor David Skegg is pushing for the Government to invest more in universities, saying New Zealand institutions are likely to lose high calibre staff and students to Australia if funding continues as it is.
The University of Otago has a strong relationship with the University of Western Australia; currently, both have around 21 000 students and a strong research focus. Yet as Professor Skegg points told the Otago Daily Times, Otago receives roughly half the amount of government tuition subsidies, student fees, and research income, as does the Australian university.
The relatively low level of Government funding is the most serious problem New Zealand universities face, Professor Skegg said. "Unless this gap in funding can be narrowed, it is hard to see how New Zealand universities can continue to attract and retain staff and students of the highest calibre."
An Australian study has shown that higher education, taking account of all costs and benefits, produces a real economic rate of return of 14 to 15 percent, more than double the benchmark of six to seven percent set for good investment. The lack of investment by the New Zealand Government means that such returns are being realised on a much smaller scale than occurred in Australia.
Professor Skegg continues, "No one expects universities to be immune from the financial crisis that has affected New Zealand and other countries. Nevertheless, we hope the Government will recognise that investments in education and research produce large benefits for the economy as well as society."
The University is predicting a surplus of $18.9 million this year, opposed to last year’s $21.2 million. However, Professor Skegg maintains that this surplus is only the result of constricting spending in almost all areas, and not indicative of a surfeit of cash. "It is vital we maintain adequate operating surpluses in order to fund the infrastructure that is urgently needed, but this is becoming increasingly difficult, especially in the current financial environment."
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