Australian universities are increasingly focused on financial performance and investments rather than their primary function of higher education. James Guthrie, Peter Tregear and Adam Lucas with the story.
The university sector is under increasing financial pressure, and earlier today, the Australian National University announced that Vice-Chancellor Genevieve Bell has resigned after months of controversy over her handling of massive cost-cutting programs.
However, as scholars working across higher education policy, accounting, and governance, Academics for Public Universities believe ANU’s trajectory reflects a much broader systemic issue — one that demands urgent attention and public discussion.
Universities were never meant to be property developers. However, across Australia, they increasingly behave like real estate trusts and investment funds, with education slipping into the background. The Australian National University (ANU) is a striking example.
A post-pandemic model
Like many Australian universities, ANU was hit hard by COVID-19. In 2020, it posted a $162 million deficit, mainly due to the collapse of international student fees. To stabilise its finances, the University cut over 460 staff positions and announced a sweeping financial recovery plan.
But here is the paradox: while education and staffing were cut, ANU’s financial wealth kept growing. By 2023, the university held over $2B in financial assets and recorded $3.4B in total net assets. It continued to run cash surpluses despite reporting accrual accounting deficits. These were, however,
driven by investment volatility and depreciation rather than operational losses on a cash basis.
Accrual accounting, in fact, only records revenue when it is earned and expenses when they are incurred, regardless of when cash changes hands. This is perfectly sensible in a commercial setting. However, in universities, it creates the ideal conditions for manufacturing a fiscal crisis on paper while millions sit untouched in the bank.
Under accrual rules, non-cash charges such as depreciation – often on buildings gifted outright by government (i.e. acquired for free) – are booked as annual losses. The effect is to conjure deficits where none exist. A university with generous cash reserves can thereby be made to appear on the brink of insolvency.
Such paper deficits are then brandished to justify mass redundancies, course closures, and the redirection of operating surpluses into speculative property developments and opaque investment funds.
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Imprudent financial management
This is not financial prudence—it is political theatre. And like all theatre, it relies on keeping the audience in the dark, while all decision-making power is centralised, dissent is marginalised, and public accountability is reduced to glossy annual reports and staged media appearances.
ANU is a prime example. It has the balance sheet of a highly capitalised investment entity, even while acting as though it were on the brink of a liquidity crisis.
Accrual accounting may well suit the construction of crisis narratives by savvy private sector consultants for eager university executives. It is, however, not fit for purpose in the public sector. Designed to protect the interests of shareholders, not citizens, its imposition on universities via changes to state and federal acts has entrenched a logic in our universities that
treats education as a commodity and staff as a cost centre to be minimised.
For more than a decade, Australia’s public universities have been subjected to a continuous cycle of strategic reviews, cost-cutting, redundancies and reduced course offerings, all of which have had negative effects on the quality of education and research throughout the country. Most of those negative effects appear to have arisen from implementing the advice of private sector consultants who tell us they know what is best for a public university.
The scandals of late – mass layoffs, wholesale closure of disciplines, and the catastrophic loss of staff confidence in management at ANU, UTS, RMIT, UTAS, Adelaide, South Australia, UOW and elsewhere are not anomalies. They are the predictable outcome of a governance model built on the construction of accrual accounting “losses” that have been carefully crafted by external consultants and then implemented by their former employees who now populate senior management and executive positions throughout Australia’s public universities.
Driven by a growth fetish that is simply not evident among those who lead the highest-ranked universities in other parts of the world,
Australian university executives and their senior managers have become addicted to the pursuit of short-term financial gains through property development and investment vehicles. They have simultaneously become increasingly hostile to intellectual risk and challenging research while they treat staff as replaceable assets and disposable liabilities who should be grateful they have a job.
ANU as a property developer
One of the most apparent signs of the commercial growth-driven model that currently dominates the thinking of ANU leadership is its real estate strategy. The University has entered into a number of public-private partnerships to build large-scale student accommodation projects — a typical move across the sector.
However, not all of these projects have gone smoothly. ANU’s “SA8” accommodation project has become a symbol of executive and financial overreach. The project faced planning blunders, cost blowouts, and delays. It ultimately produced a $146 million shortfall in capacity and revenue.
This would be worrying in the private sector. In a public university, it should raise serious concerns about managerial priorities and risk governance.
Misleading statements
ANU’s financial statements also raise transparency issues. ANU reports $382m in what it describes as “restricted” funds, although the nature of these restrictions is opaque. With annual bequests totalling only around $15–20 million, it is unclear who restricted the remaining $370 million-plus in funds, or for what purpose.
Similarly, superannuation reserves for the closed Commonwealth Superannuation Scheme exceed $600 million, but details on how many staff are eligible – or when those liabilities will mature – are not disclosed in accessible terms.
Even basic workforce data and the way it reports this to various government entities are often inconsistent. ANU’s public reports in 2020 listed different totals for full-time and part-time employees, with one showing 4,014 full-time and 827 part-time, and another citing 3,407 “ongoing” staff. The exclusion of casual staff from several reports only clouds the picture further.
As in past years, public reports from ANU are consistently released many months after the date they are due. For example, when searching for the ANU Charities Commission Report 2024, we were unable to confirm the employment data for 2024.
| Financial Report 2025 | 30 June 2026 | Pending |
| Annual Information Statement 2024 | 31 July 2025 | Overdue |
A national issue
This is not just a problem at ANU. Public universities across Australia have embarked on large-scale real estate developments, often using large debt vehicles, service concessions, and asset sell-offs to finance growth.
This has meant accrual-accounting concepts of depreciation, impairment, and interest payments are now being routinely applied to university teaching and research as though they were operational expenses, rather than the core business of a university.
Universities were never meant to be profit-seeking corporations. They were founded to serve the public good — to educate, create knowledge, develop professional skills and contribute to civic and cultural life.
What concerns us most is the cultural shift. As universities expand their asset base, reduce staff, and reorient strategy toward revenue generation and growth,
they risk becoming unrecognisable to the communities they were created to serve.
Financial self-sufficiency should not be privileged over quality teaching and research. Nor should universities be allowed to quietly pivot into commercial real estate development without adequate public scrutiny.
The sector urgently needs a framework that balances financial resilience with educational integrity. Transparency must improve. Governance structures and practices must be made accountable to the academic and public communities they represent. Moreover, the possible conflict of interest and the real costs of commercialisation — to staff, students, the production of knowledge and the quality of professional training — must be brought into the open.
If ANU’s current path tells us anything, it is that public universities are at risk of losing their purpose. It is therefore high time that more of our fellow Australians began to ask: who and what are universities for? And who gets to decide?
Adam Lucas is an honorary senior fellow in the School of Humanities and Social Inquiry at the University of Wollongong and a founding member of Academics for Public Universities and Public Universities Australia. He was previously a researcher and policy analyst in the NSW Cabinet Office and the Departments of State and Regional Development, Aboriginal Affairs and Housing.
James Guthrie, AM, is Emeritus Professor in the Department of Accounting & Corporate Governance at Macquarie University. He is joint founding editor of Accounting, Auditing and Accountability Journal, consistently ranked in the top five accounting journals. James has a long history of researching public sector issues, having published 220 articles, 20 books and 45 book chapters.
Peter Tregear is an academic, performer, and arts commentator. He is a Principal Fellow of the Melbourne Conservatorium of Music and an Adjunct Professor of the University of Adelaide. He was formerly Professor and Head of the School of Music at the Australian National University from 2012–2015.