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Uni launches a voluntary departure plan

The University of Otago has launched a voluntary layoff program for staff, as it seeks to contain spending in the face of the loss of international students and rising costs.

Acting Vice-Chancellor Professor Helen Nicholson said that while the University was able to respond to the immediate financial impacts of the Covid-19 pandemic and was not facing any immediate financial crisis, the outlook financial beyond 2021 were difficult.

“After full consultation with the new Vice-Chancellor, Professor David Murdoch and the support of the University Council, we will launch a voluntary departure program on Monday October 4th.

“It was a very difficult decision to make after all the sacrifice and hard work of the University staff over the past 18 months. We are making this decision now to ensure that the University remains financially resilient for years to come. “

Several factors have contributed to the University’s financial outlook, which has been exacerbated by the Covid-19 pandemic and the emergence of the Delta variant, she said.

Previous financial forecasts included the assumption that the number of international students would start to recover in 2022.

“We now know that the rebuilding of the international student cohort is unlikely to begin before 2023, and then it could take up to 10 years for student numbers to recover. While our historic caution in capping international numbers has protected us from a more serious impact, we are currently losing $ 15 million in revenue per year due to declining international listings, ”said Professor Nicholson.

Revenues from increased domestic student enrollment would not be sufficient to offset this and other financial pressures.

“Our income is not keeping pace with our spending. The reality is that the funding and fee income we receive for every national student we enroll are not keeping pace with inflation or rising salary, operational, and compliance costs. “

The budget forecast was also affected by the substantial unforeseen costs associated with the rental of office space for approximately 500 employees and study space for 1,000 students who were moved out of the main university block of the Wellington campus in August because of its low seismic rating.

“I am very grateful for the way our staff and students in Wellington have responded to this unexpected disruption. Finding a new space for them is a priority, ”said Professor Nicholson.

Other factors influenced the decision, including the increase in salary expectations and the cost of the University’s capital development program. The university recognized that the cost of living in New Zealand was increasing and wanted to be able to pay its staff fairly.

“We are committed to providing a safe and appropriate working environment for staff and students, now and in the future. Therefore, we are embarking on our capital development program. Although necessary, this program is expensive and the pandemic has pushed up the costs of the project. “

Professor Nicholson said the process would not impact students’ ability to complete programs they are currently enrolled in or which started in 2022.

All permanent staff, academic and professional, could express their interest in a voluntary departure.

Expressions of interest would open on October 4 and close on November 15. Most decisions about whether to accept a termination request would be made and announced within two weeks of the closing date.

Support services would be available for staff.

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