This essay will focus on Victorian public universities and how they account for the loss of employed staff in 2020.

We analysed the Victorian universities annual reports for 2019 and 2020. Also, the charities commission reports 2019 and finally, the Department of Education, Skills and Employment 2020 workforce data. How many people lost their work in Victorian public sector universities in 2020 is a mystery as none of the documents reconcile and disclosed different number and categories for staffing.

The New South Wales Parliamentary enquiry into New South Wales universities came up with a simple but effective disclosure regime for staffing profiles. Smith and Guthrie (noted in CMM that previous 2019 disclosures of employee staffing numbers were confusing and that current redundancy updates do not provide an accurate picture of the number of people who have lost their employment.

The NSW enquiry recommended

“That the NSW Government mandate that universities provide a more detailed report of their staffing profiles, including a requirement that data be provided on permanent, fixed-term and casual staff levels in terms of both headcounts and full-time equivalents, modelled on the Victorian reporting requirements.”[i]

However, most Victorian universities do not follow these approaches in their 2020 annual reports.

We have closely examined the annual reports and note that they have changed how they calculate headcount from 2019 to 2020 and use accounting losses to justify reducing employment. In press releases and internal documents, public sector universities have adopted imprecise language to describe financial results for 2020, with terms such as “reportable,” “operating,” “statutory,” and “underlying” sometimes used in the same sentence. Universities use accrual accounting in their annual financial statements rather than cash accounting approaches. Many non-cash costs such as depreciation, and provisions such as restructuring costs, are included even if they bear little relevance to a public university context.

The result is that reported earnings are less than if we focus on the cash flows reported in most universities released annual reports, which indicate surpluses for 2020.

Accounting change for employees means that they do not include all the people employed on the payroll for the entire year, and therefore it is difficult to determine how many last worked in 2020.  Also, our analysis of data from the Department of Education, Skills and Employment indicates that there has been a change in how universities account to the Department for their employees in 2020. It should be noted that we cannot reconcile these numbers with the universities’ annual report numbers for staffing for 2020, as shown in Table 1.

Ian Marshman and Frank Larkins estimate in CMM  that 7500 Victorian universities employees had lost their jobs in 2020 bases on 2020 annual reports, but we believe this figure is understated. This is because vice-chancellors do not like to disclose lost jobs, especially their adverse impacts on people, teaching and learning.

The table below highlights data that we collected from annual reports. Our analysis shows several observed accounting actions used to determine what gets counted and not counted. This includes calculating FFTE, differences in numbers from the 2019 annual reports, employment by third parties, and recognition of employees’ total numbers over a year instead of those paid during the last pay period. Also, when a tenured professor goes out, and a level B lecturer comes in on a three-year contract, that is treated as no net change, even though the impact on a university’s operations is significant.

Disclosures for Victorian universities reveal,

Deakin University showed a 594 decline in headcount from 2019 to 2020. However, the extent to which this portrays the actual decline is problematic as the 2019 numbers included all staff employed across that year. In contrast, the calculations for 2020 reflected only the number of staff employed in the last pay period of that year. The 2019 annual reports disclosures have been recalculated, like most universities.

The annual report of Federation University Australia did include fixed contract and casual staff, and the census date was 31 December 2000. They also not include staff employed by third-party providers. They do not disclose the number of casuals employed or the number of people who have lost their jobs.

La Trobe University includes fixed contract and casual staff in its headcount. However, it does not separate the casuals from the other groups. Therefore, for LT U, the overall headcount of 6 795 (2019) and 5 509 (2020) staff converted into a so-called “full-time equivalent” of 3,309 and 2,876.

Monash University noted in its annual report that the Department of Education and Training workforce data reporting guidelines changed for the 2020 reporting year. However, we could not see these changes on the departments’ www site. The 2019 annual report included the total number of active casuals and sessional staff members for the entire year as of December 31 2019. In contrast, for 2020, casual employees were only counted if employed during the last pay period of the reporting year. However, it is common practice that casual employment finishes at the end of the marking period in late November/early December. This suggests that many casuals would not be counted in those final numbers. In previous years, if you were on the payroll, you were included in the overall headcount. In 2020, that had changed. In the Charities Commission report for 2019, we note that they reported 8139 casuals.

RMIT University had the most significant decline in headcount FTE from 2019 to 2020. Its headcount and FTE declined by 2957 and 864 respectively across this period 2020, representing 24 per cent and 12 per cent reductions, respectively.  The FTE numbers would suggest large numbers of casuals and part-time staff lost work.

The accounting loss was mainly associated with that RMIT reported restructuring cost of $76 million, largely redundancy payouts, (CMM May 21).

Also, note that RMIT annual report for 2020 stated that employee-related expenses increased by 12 per cent to $871.7 million and did not mention the high costs associated with redundancies.

Before restructuring costs, the increase was 2 per cent. Salary increases were due to pay-rises incurred in line with the enterprise bargaining agreement, offset by decreases in employee headcount necessary to respond to reduced student load, cancelled or postponed projects and other activities arising from the move to remote learning. As of December 31 2020, full-time staff equivalent employment of ongoing and fixed-term and casual staff was 14 per cent lower than in 2019.

Swinburne University of Technology, in their charities commission report 2019, discloses 707 casuals. However, the 2020 annual report highlights a drop of over 500. We think there is an error in the disclosures of casuals in that they turn them into equivalent full-time rather than headcount.

University of Melbourne’s 2020 annual report disclosed 9189 FTE compared to 9514 for 2019. This represents a decline of 325 staff or 4 per cent, far less in percentage terms than the other universities. These figures include continuing, fixed-term and casual staff. However, it should be noted that these figures are not consistent with those reported in their 2019 charities commission disclosures. Also, Uni Melbourne employed many part-time and casuals in service provision on campus, teaching, and research positions. However, like many other universities, numerous service provision activities have now been outsourced, such as facilities maintenance, security, cleaning and IT.

Victoria University‘s headcount declined from 4487 to 3135, a fall of 30 per cent, while its FTE dropped from 2,123 to 1,872, a decline of just 12 per cent. This suggests that most of the job losses were concentrated in part-time and casual jobs.

In conclusion, we analysed the Victorian universities annual reports for 2019 and 2020. Also, the charities commission reports 2019 and finally, the Department of Education and Training 2020 workforce data. Our observation in trying to understand how many people lost their work in Victorian public sector universities in 2020 is still a mystery as none of the documents reconcile and disclosed different number and categories for staffing.

[i] (NSW Parliament (2021), Future development of the NSW tertiary education sector / Portfolio Committee No. 3 – Education [Sydney, N.S.W.]: the Committee, 202, xviii, 140 pages; 30 cm. (Report / Portfolio Committee No. 3 – Education; No. 41) January 2021.”

Victorian Universities Employees changes in 2020 calculated from annual report disclosures.

Victorian Universities Employees changes
 We calculated from our data set
Headcount FTE
2020 2019 negative change 2020 2019 negative change
Deakin University 5632 6226 594 4259.1 4535.1 276
Federation University Australia 1618 1700 82 1238.1 1257.5 19.4
La Trobe University 5509 6795 1286 2876.4 3339.2 462.8
Monash University 9576 10042 466 8017.6 8346.6 329
RMIT University 9510 12467 2957 6111.5 6976.2 864.7
Swinburne University of Technology 4220 4820 600 2590.4 2956.6 366.2
The University of Melbourne 11376 12214 838 9189.4 9514 324.6
Victoria University 3135 4487 1352 1872.4 2123.3 250.9
Total     8175     4893.6

James Guthrie is a professor of accounting at Macquarie University. Brendan O’Connell is an honorary professor of accounting at RMIT



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