News

OUSA’s annual operating surplus fell by just under $300 000 last year, a figure that may have an impact on the organisation’s ability to provide services to students.

At the end of 2008, OUSA had an operating surplus of $1 002 902. At the end of 2009, however, this figure was down to $705 719. 
As OUSA General Manager Stephen Alexander explained to Critic, the diminishing surplus was not due to carelessness or poor management, but rather was a product of the international credit crisis. Alexander says that OUSA gains a portion of its income from interest, and at the time of budgeting interest rate rates were at around eight percent. However, the market crash slashed the interest rate to four percent, leaving OUSA short on that income line. 
The other income stream that fell short was advertising and sponsorship, again linked to the credit crisis. However, OUSA did do well in other areas and total revenue rose, although not as much as was budgeted for. Levy income continued to be an important source of income, and Alexander said “revenue was up as well as other commercial income. The University Book shop also did very well.” 
OUSA also managed a $300 000 building refurbishment of Clubs and Socs in 2009, which dented the surplus, but which was a necessary investment according to Alexander. “[It’s about] providing for the future, spending on buildings is commitment to the future,” he says. “[Clubs and Socs] needed substantial money spent on it, to put it in a condition where it is really suitable and attractive to our members.”
This upgrade consisted of a much-needed general uplift, and the installation of new shower facilities.
While OUSA has managed to fare reasonably well even during the financial crisis, it is necessary to look towards the future, as indicated by Alexander at the Executive meeting on April 27. Alexander said that OUSA needs large reserves to operate in the next year, and that he didn’t like operating on such a small surplus. 
Alexander stated that in the worst-case scenario OUSA might have to look at its total operations and assets, and start unwinding some non-productive services. However, this outcome is unlikely in the near future, as OUSA has had a good operating year so far, and isn’t expecting any adverse external shocks to the budget. 
This surplus drop comes at a time when all student associations are in limbo due to the proposed introduction of Voluntary Student Membership. However the OUSA Executive and Management seem to be sensibly buffering the budget, both to provide for future capital expenditure, and to deal with the possibility of VSM becoming a reality.