University braced for tough times

The University of Otago is facing a tight financial situation next year, with Government policy, flat enrolments and increased costs beginning to bite at the institution's finances.

The university's proposed budget for 2013, which is set to come up for approval at a university council meeting tomorrow, notes that setting the budget in the current climate was a "challenging process".

Otago University director of financial services Grant McKenzie said in the proposed budget that the response of the university's service divisions to the tight financial environment had been to "cut costs in anticipation of budget cuts".

The academic departments meanwhile had increased the use of savings built up from previous budgets, which were called "carry forwards".

The proposed budget predicts the enrolments environment will stay flat, with a slight increase in domestic full-time students from 17,426 equivalent full-time students (EFTS) forecast this year to 17,638 next year.

Full-fee paying international EFTS are forecast to fall for the second year in a row from 1555 EFTS predicted this year to 1487 next year.

In predicting student numbers the university notes it is "amongst the most difficult time in at least two decades" to forecast.

"Global uncertainty remains a significant factor and the extent to which the aftermath of the Canterbury earthquake will continue to impact on enrolments is difficult to call with great confidence."

As well, "reduced Government funding for the tertiary sector" also made setting the budget harder.

The proposed budget reports a forecast total income of $600.9 million and expenditure of $585 million, with an operating surplus of $19.125 million, up from the $18.981 million operating surplus forecast this year.

This would mean the university would fail to meet the Tertiary Education Commission requirement for a minimum operating surplus of 3% of revenue - with a 2.6% return. The university was also expecting that it would not meet the guideline this year, with a return of 2.3% forecast.

Mr McKenzie predicted difficult times would continue beyond next year with "further savings and efficiencies" needed.

The University of Otago

There appear to be a lot of comments that don't understand the advantages of the University. Within the University people mix and discuss many things that may or may not relate to their courses byt widen their perspective. This interaction and collective knowledgeset is missing in online courses.

To this day I enjoy the variation of information available to me from the groups I work with. The sharing of knowledge and human interaction that Universities foster carries on for the rest of your life. To put a price on these "extras" would be very difficult but their value is immesurable over a lifetime.

Like Oxford and Cambridge the City of Dunedin has an educational base and brings much into the area because of it. Try living in one of the industrial towns of England or anywhere else with out a University and you see the advantages one can bring.


Think again

@guadalajara ordinarily I would have agreed with you, but the University have backed themselves into a bit of a corner and refuse to engage with the outside world ... being the city they are based in. It used to be that the university created Dunedin as the city that it is today, but now the ciy holds its own and the University would now stuggle to exist without it...and the more they keep the former attitude the more the decline in enrolments will continue.

Their advertising never promotes the city itself ... not just for students but for students' families to visit their kids at, they do not engage with the business community, they've removed student life because they deem it to hurt their image, and are never present at key events for the city. Harleen said her priority was to bridge the gap between the University and the community and until that actually happens I dont see their situation changing. 

Gum bashers need falsies

Get gum bashers to the University of Otago Dental School, or are you against that as well? Uni is a place to learn critical skills. NZ can be a bit anti-intellectual.

Hi-tech? Retired foreigners?

farsighted don´t you think there are other cities and places where high technologies would be cheaper and easier to set that in remote Dunners? And who would use those if not the University and its linked institutions? Local Dunedinites checking facebook events? Who would bother? and also, don´t you think that retired foreigners would rather go to a sunny and warm place closer to the tropics than humid and rainy Dunedin?

Dunedin is what it is because of the University, no matter if you like it or not, if the University goes one day, many businesses will also go and people will move to Wellington, Auckland or even Chirstchurch and Queenstown would become the main place of Otago, letting Invercargill be the main population of the South.

Keep scratching

One online course offered by an instructor of international renown passed 23,000 students last year.  That's more than the total enrolled at Otago Uni. Bricks and mortar universities are too slow and too small for the modern world.
Dunedin's best (and possibly only) bet is to become a "nice place to live" tied to hi-tech, lightweight export industries.  IT, Internet, design.  Plus retirement homes for elderly foreigners. 

Scratching my head

Anyone who thinks the university is contributing to Dunedin's decline must inhabit a parallel universe. Take the University away (and the associated influx of cash to the city), and then you'd see a decline. Post-apocalyptic springs to mind.

Corporate spin

The University of Otago has become a "for profit" educational institution, leveraging the tax payer funded student loan scheme and and its massive rates discount to drive its billion dollar property portfolio. The University of Otago in the past brought something unique when it was a leading educational institution, but now its just a printing press for degrees. It does not even rank in the top 100, and it's contributing to the economic decline of Dunedin.

'Educated beyond their means of intelligence'

Me thinks that Rob Fischer when referring to the "so called educated people" should have used the phrase "educated beyond their means of intelligence"

So funny

Re Boldor. My thoughts exactly .

While I am not an academic I do work at the University. Outragous salary? - I don't think so. I have worked my way up the ladder so I don't have to live on the minimum wage and oh by the way "I am a real person"



University of Otago

As an ex grad I would like to comment on the reason many come to Otago for their education. Otago has a long and distinguished history as a premier school of learning. It is held in high regard world wide. And this flows over into respect for the various degrees offered when it comes time to put that learning to work.

It is also a leader in many fields of study. Providing advances in several sciences that impact the world. Otago has huge recognition in the global community for the level of expertise and dedication to real results in various fields being studied. 

I am proud to have attended this fine University and to have lived in Dunedin for a large part of my life. For the combination of city and university made for an exciting and interesting place to live. The City without its University would not be the same.


Young people from around the world are enormously excited to come to countries such as New Zealand or Australia to study. If you rip them off charging 27,000-30,000 bucks a year, plus the money they need to spend on living expenses, study expenses, visas, travelling etc makes that option just impossible for the vast majority of the internationals checking the Uni website.

And I've seen many people who have been keen on coming to Otago and just couldn´t make it. However, in the current financial situation, if those international fees are reduced to 15,000-18,000 dollars, then the reality would be another and probably a much larger number of students would be keen on coming (a class that has 40 students can host 60 for almost the same price, so why charging so much to a few students?).

Remember that international students, and especially the new ones are the ones that need to buy furniture, pillows, duvets, clothes... bring lots of money to run the economy much better and export the name and the beauty of New Zealand to all countries. Ladies and gentlemen ruling the OU and council, Wake up with that matter.


Educated people

'Educated' can be a subjective term, I am just a tradesmen so what would I know. One thing I do know is today's kids leave school with the main aim of getting on the student loan gravy train. They see the the uni promoted as a place to party, hook up and do a little study. What is the pass rate of the last few years, I believe it was reported last year as low as 60%. Then the ones that do pass end up working driving cabs or cleaning or even worse working in the social sciences fleecing the taxpayers even more.

Although they weren't so stupid to pour money into that white elephant that the ratepayers are paying for, but they made a good job of making look as though it's their stadium, not that stupid after all.


So called educated people

Boldor, I'm not sure if this is a difficult concept to grasp (I didn't think so until today) but the "so called educated people" are "so called" because they are ... er ... "educated." Understand? If you want, I can go over it again.


They should start with toning down their outrageous salaries, that would save them a truckload of money straight up,and stop bleating on about it to the public as well. The public of this city have their own problems  like paying the ever increasing rates. It would also be a good idea for them to stop bashing their gums about new buildings etc that also does not go down well with the public or the plebs as these so called educated people think. Time to depart Fantasy Island again and get back to the real world where real people live on $13.50 an hour.

Student pubs

Agreed, bring back the scarfie lifestyle. The uni must be out of touch with what its students want. It used to have something for everyone as lifestyle goes.

Coming home to roost

An 18 year old prospective student isnt coming to Dunedin for the weather, and your average BA/BCom student isnt coming to Dunedin specifically for the quality of education. The University of Otago's core point of difference and its attractiveness tradititionally lay in its associated lifestyle, which is being depleted year in year out by actions like the closure of the iconic student pubs that once offered frugal drink specials and food that kept students off the streets and out of trouble.
Marketing 101 - if your have a point of difference or competitive advantage, embrace and exploit it. Don't try and take your competitors head on.