‘A catastrophic failure’: Unions criticise secret, exorbitant spending

The National Tertiary Education Union (NTEU) has alleged corruption at the highest level at Australian universities, following revelations of an estimated $1.8 billion in spending on consultants over a single year – and there is no current mandate to disclose where the money is going.

The investigation, conducted by the ABC, looked at the recently published annual reports of 38 Australian universities to uncover the depth of the spending, but the education sector union has claimed the evidence of governance failure and flawed data spurring cuts has existed for years.

As reported by HR Leader last year, the Senate education and employment legislation committee published its Final Report of the Inquiry into the Quality of Governance at Australian Higher Education Providers, concluding that there was an issue with “over-corporatisation” of the Australian university sector, and making a further eight recommendations to the 12 added in its interim report.

Recommendations such as clarifying the role of universities and reviewing the funding model were proposed to target universities’ increasing reliance on external consultancies, which have been accused of infiltrating universities, following questionable advice that has led to cutting courses and jobs, and undermining the sector’s existence as a public service.

For NTEU national president Dr Alison Barnes, the evidence is now impossible to ignore.

In a statement on 31 March, she criticised how “university leaders have been cutting courses, slashing jobs and telling staff and students there was no choice”, adding: “Our long-held suspicions that the financial crises driving many of these decisions weren’t real have now been confirmed.”

She said: “The NTEU raised these concerns for years. Vice-chancellors didn’t want to hear it. Staff, students and the community have paid the price for their arrogance and impunity.”

The investigation also revealed the presence of consultancy firm partners on the very university councils and senates that exist to provide oversight – and those same firms were sometimes given contracts from the universities themselves.

Barnes said: “Every time we look under the bonnet of universities, what we see is even more rotten.”

“Consultants with no accountability, liability or expertise are being paid billions to gut universities.”

Speaking to ABC, Senate inquiry chair Tony Sheldon highlighted how it “demonstrates the lack of transparency and accountability” and criticised how universities have “never exposed themselves on the amount of consultancy work they get done”.

Also reported by HR Leader last year, the University of Technology Sydney (UTS) released its Operating Sustainability Initiative as part of its overarching reduction target of $100 million in operating expenditure starting in 2026.

It was proposed that 209 full-time roles be cut, as well as the elimination of bonuses and incentives.

At the time, Barnes criticised the proposal, stating: “This is a prime example of why governance reform announced by the federal government is needed so urgently. University leaders pocket $1 million a year while attacking the fabric of our public institutions with no accountability.”

This is not the first time the NTEU has accused UTS of demonstrating poor management; following the university’s plan to cut expenses by $100 million while making capital investments of $640 million over the next five years, and cut hundreds of roles – while relying on external consultants – was described as creating a culture of fear and mistrust between staff and management.

On the latest findings, Barnes acknowledged “the Senate inquiry has done its work”, but called for faster and more ambitious reform from the government.

The NTEU has called for full implementation of the governance recommendations, as well as mandatory public disclosure of all consultancy spending, strengthened intervention powers from the Tertiary Education Quality and Standards Agency (TEQSA), a more student-forward funding model, increased staff and student representation on university councils and new powers for academic boards to hold councils to account.

Barnes said: “The government knows what needs to be done; now it’s time for major action.”