Govt’s carrot-and-stick approach to uni merger

Treasurer Stephen Mullighan says that if the universities of Adelaide and South Australia don’t “voluntarily” agree to amalgamate – with a decision expected this weekend – they risk losing merger support funding while still facing a government-established inquiry to “find ways in which the universities can merge”.

Jun 30, 2023, updated Jun 30, 2023
Merging the University of Adelaide and University of South Australia would immediately create one of Australia's largest universities by student numbers. Photo: Tony Lewis/InDaily

Merging the University of Adelaide and University of South Australia would immediately create one of Australia's largest universities by student numbers. Photo: Tony Lewis/InDaily

Mullighan faced questions in parliamentary estimates on Thursday about the undisclosed amount of funding the state government will provide the University of Adelaide and University of South Australia if the two institutions agree to merge this week.

On Wednesday, Premier Peter Malinauskas reiterated his earlier vow to “make” the merger happen, telling parliament – after Upper House MPs said they would not green-light necessary legislation – that the government was “determined to pursue this policy and we look forward to an outcome in the not-too-distant future.”

With a decision expected this weekend – the universities face a carrot and stick approach from the government.

If they approve a merger, they will receive government funding to support amalgamation. If they refuse, the government will re-establish a commission of inquiry “to find ways in which the universities can merge”, Mullighan said on Thursday.

But the Treasurer also hinted the government might change its funding support for a merger if the universities do not agree to one.

Opposition Treasury spokesperson Matt Cowdrey asked Mullighan whether he could indicate if the financial sweetener for amalgamation was between $50m to $100m, $100m to $200m, $200m to $300m, or $400m.

Mullighan declined to provide specifics, only indicating the government would support a university-backed merger “in a range of limited ways”.

“But we are not at that juncture yet, no decision has been taken,” the Treasurer said.

“And it is open to the government to not provide support to those universities if they do not decide of their own volition to merge.

“That is why we have not provided a specific funding line in the budget for this. We do not want to, I guess, signal broadly what appetite the government may have to support a voluntary merger.”

Mullighan then said the government’s “view about supporting a merger in the future, if it is not voluntary, may change”.

“That is why we are not disclosing in what way we might be supportive and what quantum of funding that might involve,” he said.

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Cowdrey then asked Mullighan: “Did you just say that an involuntary merger was on the cards?”.

The Treasurer replied: “What we have said… is that should the universities voluntarily, of their own volition, decide to pursue a merger – terrific.

“It is open to the government then to find ways to support that effort, and we feel comfortable that the budget has sufficient capacity within it for a range of measures that can support that merger.

“If they do not decide to voluntarily merge then, as the Premier said [Wednesday], we will seek to re-establish a merger commission to find ways in which the universities can merge.

“In that event, if that is necessary, we may change our view about to what extent we provide ways of supporting a merger.”

InDaily asked the Treasurer whether the state government has told the universities they will receive less funding support for a merger if they don’t agree to amalgamate. In a statement, he replied: “Absolutely not.”

The state budget did not provide any details about how much funding is on the table to support a merger.

The government’s university merger commission of inquiry – put on hold in December when UniSA and the University of Adelaide struck a merger agreement – was allocated $1m and three full-time employees in the 2022-23 state budget.

South Australia’s higher education union earlier this week said the university councils were likely to approve amalgamation so they could “keep control” of the process rather than face a public inquiry.

“No one can see them saying ‘no’ otherwise the government will compel them to a commission of inquiry, then the two university councils lose carriage of this project,” union secretary Andrew Miller said on Tuesday.

Opposition education spokesperson John Gardner said: “The Premier has been beating his chest for months saying this will definitely happen and that he will make it happen.

“The Treasurer seems to be trying to play the role of a tough negotiator, who could take or leave the amalgamation, as if the Premier’s bold rhetoric had never happened.”

InDaily contacted the Treasurer’s office, University of Adelaide and UniSA for comment.

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