Last Wednesday the VUWSA executive passed the 2006 budget. The budget passed shows that VUWSA will make a $103,000 deficit for 2006. In 2005 we made a deficit of roughly $100,000. In both 2006 and 2005 the Student Union complex contribution of $175,000 wasn’t charged, and if it had been, our deficit would be closer to $300,000 for each of those years. In 2004, the only reason we made a surplus was because the $175,000 wasn’t charged. Next year, given the really positive progress we have made on the Student Union complex negotiations, we expect to be paying the $175,000 once again.
This week Salient is doing a feature on the levy and related issues, so I’ll try not to double up. But the basic facts are that VUWSA has a levy of $99 which was set back in 1998 for the 1999 financial year. Every year our costs go up with inflation, but the levy remains static. At the VUWSA AGM on September 6th we are likely to be discussing the possibility of raising the VUWSA levy. At this meeting students will have to decide whether they want to maintain current levels of services and increase the levy, or keep the current levy which will mean that VUWSA has to significantly reduce its level of operations.
Elsewhere in this magazine I’ve written a piece opposing increases to student fees. Some could argue there is a contradiction between arguing that the VUWSA levy will probably have to increase its levy and not wanting the university council to raise tuition fees. The fundamental difference here is that tertiary education is a public good and should be publicly funded (which has been VUWSA’s position throughout the ages) and that increased costs to institutions like Victoria should be covered by the government. Fundamentally the proportion of costs that students pay in course fees is already too high now, so any increase exacerbates this problem.
By contrast I believe that the $99 VUWSA levy set in 1998 was correct at the time. However after 8 years of cost increases, the expansion of Victoria onto four campuses and with the general cost increases it is clear that there is a gap. Currently VUWSA’s level of expenditure is too high for its annual income. VUWSA’s main source of income is the levy. Our levy is one of the lower ones in the country; by comparison Massey Wellington charges $130 and Massey Palmerton North charges even more. At the University of Auckland the students’ association largely relies on money from the university to provide services, and they do this due to being a voluntary association (the only university students’ association in Aotearoa that is). Generally a lot of the services that VUWSA provide are of considerable importance, and if we didn’t provide them the university would have to pick up the tab. In reality if VUWSA’s levy stays the same or drops, it would result in the university increasing levies such as the student services levy or the Amenities to pick up things VUWSA could no longer fund (eg. SJS, Welfare services, advocacy services, clubs etc). At least with the VUWSA levy students get democratic control over how this is spent.
When I first started on the exec in 2003 our concern was that our surplus was too high and this meant we hadn’t spent enough of the student money given to us. The previous year the exec had faced issues with over spending, and had made considerable cut backs, which many of us believed cut into what was VUWSA’s core business (cutting club grants etc). From 2003 onwards we returned to previous levels of spending and started extending our services to satellite campuses (Pipitea mainly). I still believe this was the right decision, but clearly the revenue situation hasn’t been addressed since then.
A number of our processes are also in need of review. Since 2003 the earliest we’ve managed to pass a budget was August of that financial year (this year included). There are various other processes that also need serious review. The VUWSA Trust has agreed to pay for Horwath Strategy (Wellington) Limited accountants to come in and review our financial and budgeting systems. They will go through and look for ways we can be more efficient and provide the services that we want in the most cost effective way. They will also be looking at our revenue and expenditure levels, and make suggestions as to what might be considered appropriate.
We will also be looking at ways to improve our accountability structures within VUWSA. Part of this is getting the budgets done on time. In our 2006 strategic plan we have set a target of getting the 2007 budget done by the end of this year. We will work with the incoming 2007 executive to see that this is done. This provides VUWSA with far greater accountability and financial control from day one of the next financial year.
The current budget issues we have are clearly fundamental, and have now existed for a number of years. As the VUWSA President I am committed to working through this issue and seeing that we have the best possible result for students, both in the short and long term. I look forward to getting VUWSA back to a position of financial health for the coming year.
Part 2 of the SRC series on the current crises in with Israel, Lebanon and Palestine. This week David Zwartz, the honorary Consulate in NZ for the Israeli government and Don Carson from the Wellington Palestine group will debate the current issues. 12noon, Wednesday in the Mt Street Bar and Cafe.