The university’s budget, released to the Otago Daily Times, proposes a deficit of $15.5 million for the year, compared with an actual deficit of $22.5m for 2024.
The document said the budget came during a period of "continued international and national disruption".
This disruption had its origins in the Covid-19 pandemic, but was now "overlaid by geopolitical and climate instability" and local reform of both the higher education and research funding sectors, the document said.
The budget outlines the university’s plans to "increase student numbers", "streamline papers to market needs" and better utilise space.
"The academic division is reviewing its papers and programmes to ensure best fit with market demands and future workforce needs."
Politics lecturer Dr Brian Roper was concerned about the phrase "to meet market needs" and "streamlining" in the context of the curriculum.
"The university’s primary mission should not be vocational training, but rather educating successive generations of young people with the knowledge and the skills required to be not only productive employees, but also well-educated citizens in a democracy.
He appreciated that the "market-led" approach was mostly driven by the funding models, which "really locks managers at all levels from the lowest level of the managerial hierarchy right up to the vice-chancellor, the senior leadership team and the university council to really operating as if the university is a business".
Dr Roper said the fact the government allowed the university to increase tuition fees by as much as 6% meant there was a shift away from a research-focus to a "bums on seats" model.
"It seems to me to be a very short-sighted approach, which isn’t going to contribute positively to what this government claims is its overriding objective, which is to get the economy growing."
Tertiary Education Union co-president Craig Marshall said it was interesting the budget was so "market-centric".
"Fundamentally, the problem is there’s not quite enough money there to do what the university needs to do.
"So while we have issues with the way the university allocates its budget, our bigger problem is that there’s just not quite enough money there to do it."
The budget aims for an increase in international student numbers of 16% on 2024.
Mr Marshall said that was particularly ambitious.
"The fact that every other country in the world is doing exactly the same thing means it’s not quite a free gift to go after international students."
Mr Marshall said he would like to see more staff input into the budget process in the future.
The university had 19,078 fulltime-equivalent students at the start of 2025, its highest since 2022.
Otago University acting vice-chancellor Prof Jessica Palmer said it was committed to ensuring papers and programmes were responsive to student interests, workforce needs and industry developments.
"We want our graduates to be well prepared for the future with skills and knowledge they will need.
"In addition, it is important that we are operating within our available resources. This work involves reviewing and, where appropriate, consolidating papers to reduce duplication and better align with industry trends."
The university’s budget reflected the challenging financial and economic environment, she said.
"Broader structural funding issues remain a significant concern and we continue to advocate for sustainable investment in tertiary education so that we can fulfil our mission to undertake outstanding research and enable transformative learning and student experiences."
