La Trobe University has denied claims it is at risk of going broke.
An article in The Age on Wednesday said the university was “at risk of going broke in a matter of weeks unless it secures a financial lifeline from the banks and an agreement from staff to cut wages”.
But La Trobe said this was not true.
In a statement, the university said the COVID-19 pandemic had meant the higher education sector faced financial shortfall and uncertainty, and La Trobe was no exception.
“The university is in productive and ongoing discussions with its three banks for increased facilities that we believe will meet our funding requirements in the short term,” the statement said.
“The university faces significant revenue losses this year and in 2021 and 2022, and the university is taking action to find cost savings and balance its books over the longer term."
The Age reported the university faced a revenue slump of $400 million to $520 million between now and the end of 2021.
However, La Trobe said it had made $87 million in cost savings for 2020, including an expected $20 million to be saved by voluntary redundancies that were offered to all staff last month.
The proposed Australian Universities Job Protection Framework is also expected to save the university about $16 million in 2020 and $32 million in 2021, if approved by unions, staff and the Fair Work Commission.
The framework will see a temporary variation to the university’s enterprise agreement, with key measures of the scheme including a 10 per cent pay cut (first $30 000 excluded), no increments paid until 2022 and pay uplift delayed to 2022 for promotions.
If the changes are approved by the National Tertiary Education Union, university staff will be able to vote for the changes in mid-June, which is expected to save La Trobe the financial equivalent of about 225 jobs.
“Where possible, we will endeavour to minimise job losses so that La Trobe can continue to make a profound difference to the lives of our students, our partners and our communities,” the university said.
The La Trobe campus in Shepparton employs 35 staff and has 417 students enrolled.
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