ANU urges staff to sacrifice pay rise in $250m cost-cutting drive

The Australian National University (ANU) has sparked controversy by asking staff to voluntarily give up an agreed pay rise as part of a larger effort to reduce costs by $250 million. This request, according to the National Tertiary Education Union (NTEU), will not prevent the looming threat of over 600 job cuts and reflects what they call the chancellery’s "complete mismanagement."

In an email sent on Tuesday, ANU Vice Chancellor Professor Genevieve Bell asked university staff to forgo the upcoming 2.5% pay increase scheduled for December, which is part of the institution’s enterprise agreement. Bell explained that the measure was necessary to help the university meet its significant cost-cutting target.

"Everything needs to be on the table, including all of our salaries," Bell wrote. She also announced a personal commitment to the effort by reducing her own salary by 10% immediately.

The ANU Council, in a meeting last week, directed the chancellery to reduce the university’s recurring costs by $250 million by the end of 2025. Of this total, $100 million is expected to come from cuts to staff expenditure.

Request for Pay Cut to Be Decided by Staff Vote

The request for staff to give up their 2.5% December pay increase will require a majority vote by those employed under the ANU’s enterprise agreement. A rally, organized by the NTEU, is set to take place in the university’s central precinct on Wednesday, where staff will voice their opinions ahead of the vote. The union, which had planned the rally before Bell’s email was sent, is advocating for accountability and opposing further staff cuts.

The NTEU estimates that the $100 million in staff expenditure cuts could equate to 638 full-time staff positions. With 50 job cuts already announced at ANU, the union expects further losses in late 2024 and early 2025.

While Bell’s request applies only to the December pay increase and not future increments under the enterprise agreement, the NTEU remains unconvinced that this measure will protect jobs. The current agreement, covering the period 2023-2026, includes a total pay increase of 18.5%, paid in six-monthly increments. Even if staff forgo the December raise, they would still receive a cumulative 16% pay increase over the life of the agreement.

"I know this is a big ask," Bell said, "but if we take it collectively, it will prevent some job losses in our community."

Union Doubts on Leadership’s Promises

Millan Pintos-Lopez, president of the NTEU’s ANU branch, expressed skepticism about the vice chancellor’s assurances that the pay sacrifice would save jobs. He cited a similar situation in 2020, when ANU staff agreed to forgo pay raises to protect jobs, only for the university to proceed with 465 layoffs.

"It feels like we’re in an episode of Fawlty Towers. There’s just a sense of complete mismanagement and delusion from the chancellery," Pintos-Lopez said.

He also highlighted the broader context of staff frustrations, citing the rising cost of living, a 177% increase in parking fees on campus, and continued job cuts, while the university’s leadership continues to hire new executives on high salaries.

"It’s absurd," Pintos-Lopez remarked. "They’re asking us to take a pay cut while they bring in more executives on exorbitant salaries."

The NTEU criticized ANU’s top-heavy management structure, noting that over 80 employees earn more than $300,000 a year, with 12 staff members receiving more than $500,000 annually. Pintos-Lopez emphasized that professional staff, particularly lower-level employees, are often the first to face cuts.

Leadership Pushback and University’s Defense

In addition to the pay cut request for regular staff, Bell also asked senior leaders on performance-based contracts to forgo their 2.5% salary increase in December. This move is expected to save the university around $1.2 million.

While staff employed under performance-based contracts can make individual decisions about their pay, for those under the enterprise agreement, the decision will be determined collectively.

Pintos-Lopez anticipates strong opposition from staff, with many expected to rally against the vice chancellor’s proposal. "There is every likelihood our members will rally together and ask union leadership to fight this," he said.

The NTEU has already noted a decline in the vice chancellor’s popularity and the general dissatisfaction among staff, referencing the fallout from the 2020 decision to alter the enterprise agreement under the uncertainty of the COVID-19 pandemic.

Meanwhile, a spokesperson for ANU defended the administration’s approach, describing it as a "consultative process." The university has been holding townhall meetings with staff and faculty across its seven colleges, gathering feedback before making any final decisions.

Financial Concerns and Union Criticism

The financial reasoning behind the university’s cost-cutting measures has also come under scrutiny. NTEU’s Monash branch president, Dr. Ben Eltham, took to social media to question the logic behind the proposed cuts, noting that ANU posted a $135 million surplus last year and has billions in assets and reserves.

However, sources suggest that much of the surplus is derived from investment income and insurance proceeds from a 2020 hailstorm, which cannot be used to cover operating expenses such as wages. Additionally, ANU has reportedly accumulated a nearly $400 million operating deficit over the past three years.

As the university grapples with its financial woes, the staff vote on the proposed pay freeze will be a crucial moment in determining how ANU moves forward amidst growing tensions between management and staff.