Premier hasn’t seen full uni merger business case despite huge funding pledge

Premier Peter Malinauskas says he hasn’t read the full business case for the agreed merger of the universities of Adelaide and South Australia he pushed for, despite committing nearly $450m in taxpayer funds.

Jul 03, 2023, updated Jul 03, 2023
Photo: Tony Lewis/InDaily

Photo: Tony Lewis/InDaily

The universities worked for more than six months developing the business case for merging their two institutions into a new “Adelaide University” by January 2026.

Both chancellors only wrote to staff about the merger decision on Saturday night, just before a news article with the Premier’s comments about merger benefits was published as part of the state government’s media strategy ahead of a Sunday morning press conference.

The state government and universities say the new Adelaide University will add $500m to the state’s economy per year, educate more than 70,000 students and create an additional 1200 jobs.

The Malinauskas Government – which strongly backed amalgamation and would have re-established a merger commission of inquiry had the universities not “voluntarily” approved it – has committed $445.5m to support the merger via perpetual investment funds, land purchases and $30m for measures attract international students.

But the full merger business case has been kept under wraps, with both universities citing commercial considerations and only committing to releasing a summary of the document.

UniSA vice-chancellor David Lloyd said today that information within the business case “that’s going to impact the competitiveness of the institution” will likely be kept secret.

“We have said that we’ll be able to put in place as much as we can that’s not commercially in confidence,” he said.

“Anything that’s going to impact the competitiveness of the institution we’re probably going to have to redact.

“We will be able to put sufficient evidence so people can see we’ve thought this through, we know how it’s going to go, and we know the costs that are involved and how we’re going to actually deliver that transition.”

Premier Peter Malinauskas was asked on ABC Radio Adelaide this morning: “Have you read the business case used by the universities?”.

Malinauskas replied: “No, I’ve got the summaries of them from the universities.

“The business cases are the properties of the universities themselves.

“So, they have naturally done their own work. This is their effort, their commercial investment, not from government.

“We’ve worked as a government collaboratively with them in terms of the financial package that we’ve put in place.

“But the business cases are exclusively the work of the universities, and it is their intellectual property.”

Malinauskas was later asked at a press conference whether he read the business case before committing government money.

He replied: “Well, the feasibility study that has been undertaken by the universities, the information that the government required, yes, of course, I’ve read that and familiarised myself with that.

“The full pieces of work that the universities retain that they need for their positions is a separate entity again.

“But in terms of the work, the formulation of the feasibility study, that has informed the government’s financial package, yes.”

The Premier said there has also been a “suite of information” shared between the Treasury Department and the financial departments of the universities to inform the government’s decision.

“So, we’ve consumed all the information that you would expect the government to to be able to arrive at the financial package we have,” Malinauskas said.

The Premier’s comments prompted criticisms from Opposition leader David Speirs, whose party faces a key decision on whether it will support the legislation required to establish the newly-merged university.

The Opposition will support an Upper House select committee inquiry to examine the merger legislation, despite warnings from the Premier and the universities on Sunday not to delay passage of the Bill.

The government wants to pass the new university legislation by the end of the year.

InDaily in your inbox. The best local news every workday at lunch time.
By signing up, you agree to our User Agreement andPrivacy Policy & Cookie Statement. This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

If the Opposition votes against a merger in the Upper House, the government will likely have to convince crossbenchers SA-Best to support the legislation. SA-Best MLC Frank Pangallo told InDaily last week he was currently opposed to the proposal.

Speirs said the Opposition holds an “open-minded position” on the merger but called on the universities to release the business case.

“We want to see those business cases, because do they stack up without the half a billion dollars?” he told ABC Radio Adelaide.

“I was fascinated by the fact that the Premier’s willing to put half a billion dollars to merge two of the state’s largest institutions together without seeing the business cases.

“There might be some commercial aspects to those cases that could be redacted or removed, but we need to see those business cases before we commit any informed decision.

“And I’ll be expecting the universities to make those public via the government.”

UniSA vice-chancellor Lloyd said on Sunday that a delay in state legislation represented the “highest risk” to creating a new university and could cost the state hundreds of millions of dollars.

University of Adelaide vice-chancellor Peter Høj also warned MPs yesterday: “If you’re worried about the state’s finances – don’t hold this up.”

UniSA vice-chancellor David Lloyd with his University of Adelaide counterpart Peter Høj. Photo supplied.

The Premier said today he was prepared to support the Upper House inquiry “provided that it is a genuine exercise that’s not focused on politics but rather focused on the extraordinary opportunities before us”.

He also told reporters that the government will “make available any advice or information we can to a parliamentary inquiry that demonstrates the value of (the merger)”.

Vice-chancellor Lloyd also said today an inquiry would be “welcomed by the universities as long as it’s delivered in a timely fashion”.

“We’ve got absolute confidence we can deliver on this plan, and we’ve got no qualms about divulging what the plan looks like or how we’re going to get there,” he said.

The bulk of the state government funding support for the merger comes via two perpetual funds: a $200m “research fund” to support the new university’s research and $100m “student support fund” to allow greater enrolment of students from low socio-economic groups.

The two funds will be managed by Funds SA and enshrined in legislation.

The state government will also buy up UniSA’s Magill campus for $64.5m and occupation rights to a “surplus” part of its Mawson Lakes campus for $50m.

Asked whether the government would pursue merger legislation again next year if it was blocked by the parliament, Malinauskas said: “This is it.”

“If the legislation doesn’t pass and it fails, all bets are off.”

Local News Matters
Copyright © 2024 InDaily.
All rights reserved.