Media Release

Monday, 19 November 2001

The Vice-Chancellor of Adelaide University, Professor Cliff Blake, has issued the following statement on the University's finances:

I have completed a budget strategy which will go to Council next week and which will provide a comprehensive resolution of the financial issues facing the University.

In developing the budget strategy I have examined the total financial position of the University. Unlike other universities in South Australia, Adelaide University has substantial financial reserves, is not required to service significant debt, and has a substantial cash flow. The particular issue to which the Commonwealth has drawn attention, and which I am addressing, is the deficit that has emerged in 2001 and which will rapidly increase in 2002 and 2003 if immediate, corrective action is not taken. The budget being recommended to Council predicts a balanced budget in 2002 and significant surpluses in later years.

To achieve this, the University had three choices: (1) to increase revenue from non-grant sources; (2) to cut costs, essentially by reducing the number of staff and putting in place robust systems of internal cost control; (3) to take a combination of these actions. I have recommended the last course of action.

I am confident that this strategy, if followed diligently and with determination over the next two years, will ensure a secure future for the University. I believe that it will win the support of the University Council and will meet the concerns expressed by the Commonwealth. The budget strategy will bring revenues and expenditures into closer alignment, within the context of the University's strategic priorities. In these circumstances, it is highly unlikely that the Commonwealth would even contemplate the appointment of an administrator or the amalgamation of South Australian universities.

The Auditor General is the University's auditor and undertakes an audit of our finances at the end of each calendar year. He is well aware of the financial strength of this University but, equally, of how that strength can deteriorate if costs are not controlled appropriately or revenue targets are not met. The University is determined to ensure that this situation does not eventuate.