May Update 2: AUS submission on College of Arts change Proposal
FROM: Dr David Small, President, AUS Canterbury Branch
TO: Trish Appleyard, PA to Professor Ken Strongman
DATE: 3 May 2006
1. Introduction
This submission is being made on behalf of the Canterbury Branch of the Association of University Staff. The AUS represents the majority of staff employed at University of Canterbury and in the College of Arts.
In making this submission, we do not condone the change process of which it is a part. Indeed we believe that it is both unwise (as we explain below) and unlawful (as we will argue in a different forum).
We are disappointed at the actions of University of Canterbury management in rejecting AUS offers of co-operation in effecting change in the College of Arts. We are particularly disturbed by the University’s refusal to share data on contribution margins that is fundamental to the case that any improvement at all to the finances of the College of Arts is necessary. That refusal, which was not accompanied by any reasons that might render it lawful (see S9 of the Official Information Act 1982), is currently subject to review by the Ombudsman but has effectively deprived us of our right to fully engage in this consultation process.
In preparing this submission, the AUS sought independent advice from beyond the University. Specifically, we convened a panel of three people who spent two days analysing documentation and conducting dialogue with University staff, students and management. We believe that this group gained a unique and valuable perspective and would encourage the committee to invite a representative of the panel to meet with it. The three panel members were:
Associate Professor Lydia Wevers, Director of the Stout Research Centre for New Zealand Studies at Victoria University as well as a member of the Marsden Fund Council, the Humanities and Law Panel of the PBRF, Chair of the Kaitiaki of the Alexander Turnbull Library, a member of the Arts Board of Creative New Zealand, a Trustee of the Council for the Humanities and a member of the Arts Board of Creative New Zealand.
Mr. Dong Li, Senior Lecturer, Subject Convenor for Chinese and Programme Co-ordinator for East Asian Studies at Massey University. published by Tuttle Publishing.
Mr. Joey Randall, Co-President of the New Zealand University Students Association.
We would also recommend that all those who make written submissions in this process be allowed to address the committee directly. The AUS would like the opportunity to do so.
2. Academic and Strategic Plan
The Change Proposal claims that the redundancies are an “opportunity to consider the College’s future in terms of academic priorities at a time of financial stringency and [the change process] is designed to ensure a sustainable future for the College of Arts at the University of Canterbury. So, the aim is to make the necessary savings in a context of evolution and development.” However, it does not clearly identify the goals of change and thus fails to establish the process as necessary.
Change may be warranted from time to time, but the process in this case lacks vision and context because the academic goals and priorities of the College have not been expressed, derived through consultation and, finally, been presented in a way that invites staff buy-in.
The Change Proposal case is made:
The Change Proposal implies that an academic or strategic plan exists, but the plan is never articulated. We dispute the assertion that the proposal is being driven by the “context of evolution and development” claimed.
The academic priorities of the College of Arts cannot be identified without input from all staff of the College. However, there has not been a consultation process between staff of the College and the authors of the Change Proposal.
There has been considerable opposition to the plan to make staff redundant that has been expressed by authoritative academic bodies of the University, notably unanimous motions from the Faculty of Humanities and Social Sciences, and from the Faculty of Engineering and Forestry, and serious expressions of opposition from Academic Board.
The Change Proposal seeks to continue a process of disestablishing entire academic programmes, adding Asian History and Islamic Studies to Buddhism. Such a process requires input from the University's academic authorities but this has not been sought.
By failing in its obligation to devise an academic plan for the College, the University may be causing a decline in the reputation and productivity of the College. A successful academic plan would make the University the obvious place for students to come. This makes the University complicit in how the College came to be seen as unsustainable.
It is impossible to come to the conclusion that the redundancies are necessary or even desirable for the evolution and development of the College, both because what evolves and develops is not explained in the Proposal and because the costs of that evolution are not presented in the Proposal.
The academic and strategic goals of the College must be known in advance so that a financial plan can be devised to achieve those goals.
It is not possible to sustain a claim that staffing cuts will contribute constructively to the evolution and development of the College in the absence of an academic plan that identifies what the University wants the College to evolve into.
3. Change Proposal, University Charter and Profile
As the Charter and Profile define the University, change should be linked to the goals and responsibilities of the institution as expressed in these documents.
The rationale for change through redundancies has not been reconciled with the Charter and Profile. Specifically, it appears that the authors of the Change Proposal have failed to address three key questions:
1. are the goals of the Change Proposal consistent with the Charter and Profile?
2. is the Change Proposal likely to achieve goals that are consistent with the Charter and Profile?
3. is the change process itself consistent with the Charter and Profile?
The Profile states a desire to “Attract, retain and develop high quality, motivated and enthusiastic staff at all levels who contribute to fulfilling the research, teaching, curriculum and administrative aspirations of the University.”
and
The Charter aims “To develop effective strategies to recruit and retain high quality staff.”
The environment created through forced redundancies could conflict with Profile aspirations. While change through redundancies might be managed in a way that did promote the Profile’s aspirations, there was no indication in the Change Proposal that this type of management was being practised, if even contemplated.
The University is obliged to consider that its actions might interfere with the stated objective to recruit and retain high quality staff. The Change Proposal should have indicated how this risk was being managed.
The Charter aims: “To strengthen the links between the University and Asia as they are expressed in our staff profile, student body, research and teaching programmes and our engagement with Asian communities in Christchurch and beyond.”
and cites:
“The University’s extensive array of language programmes – Mäori, Arabic, Chinese, Classical Greek, French, German, Japanese, Latin, Russian, Sanskrit, Spanish and elementary Italian – is one of the broadest on offer among New Zealand universities and contributes significantly to cross-cultural understanding within New Zealand.”
The emphasis that the Charter places on the University’s relationships with Asia and Asian communities, and the emphasis it places on the University as a repository of knowledge and expertise in languages, makes it particularly problematic that the University did not even attempt to address the risks associated with redundancies in Asian History, Languages and Religious Studies. The University has obligations to staff, the region and the nation, including a responsibility to maintain a diversity in its teaching and research capacity regardless of the financial vagaries of each organizational unit.
The Charter states “We are convinced that the purposes of the University will be best achieved by a partnership of all staff working together to make a difference in teaching, learning, research, administration and service. We seek to capture this in the notion of ‘parity of esteem within one university.’”
Consultation on a plan to manage the finances of the College of Arts can only be held if all know and understand the academic goals of the College and what is expected of the College by the University.
The University has failed to meet its obligations to adequately consult with staff on the case for financial difficulties and on the case that the best way to address those difficulties is through forced redundancies.
Adequate consultation would have required that the University make available to staff a detailed explanation for how the contribution margins set for the College were arrived at, how the minimum payment by Colleges to the University are arrived at, why some losses are centralized (eg, Canterprise loss of $523,000) while others are not, and why it considers the extremely similar EFTS figures from year to year to be indicative of a negative trend.
The current change process undermines the stated commitment to a partnership of staff and management, and is creating damaging divisions among members of the University community.
The Charter urges“… thatprogramme development takes place in a way that is coordinated with other New Zealand universities.”
The consultation required for establishing courses and programmes implies that an equal level of consultation is required when putting courses and programmes agreed to at risk, as may happen through forced redundancies. This is because the coordination of the tertiary sector is required to ensure that a certain capacity in teaching and research in areas of national strategic interest is not lost. The AUS has seen no evidence that the University properly considered how its actions would affect this coordination among the universities.
4. Humanities
The University of Canterbury has special responsibilities to consider the effects of redundancies on the humanities, because it has a special place among New Zealand Universities in the composite disciplines. The loss of expertise and flow-on effects on the University’s reputation could be very large and not recoverable in the short-term.
The implications of the proposed changes at Canterbury are perhaps more profound than the same changes at most other New Zealand universities because:Canterbury has enjoyed an unusually high respect in the humanities subjects including those that are targeted.
The role of humanities is central in any university. No aspect of knowledge, including the remotest research on the distant galaxies or the structure of atoms, is free of a human context or influence on human society. This context and the influence of research come to be understood through the disciplines that comprise the humanities.
The humanities are also closest to the immediate and rapidly changing events of our daily lives. For example, the recent emergence of the importance of knowledge of Asia in world politics and economy. As such, it is no surprise that there would be small fluctuations in student numbers year to year and subject to subject. The case made for a trend in student numbers, based on the EFTS figures provided in the Change Proposal, reads too much into the data. The University is unwise to make decision of such long-term impact, as redundancies may have, based on the short-term analysis of EFTS provided.
5. Financial case not convincing.
a. The financial model.
The Change Proposal indicates that University managers are confusing indicators of academic with financial health. A financially healthy but academically impoverished university is a nonsense. The financial health of the University is a strategic requirement in order to meet academic goals, but itself is not a goal. By fixating on its finances, the University makes it more difficult for the College to construct an academic plan that also raises revenues.
The University has not established a case for financial stringency, since the University is enjoying a revenue surplus ($9.2 million), over $2 million ahead of projections, and the College produces a gross surplus of over $17 million to the centre.
The AUS has reliable advice that the reported surplus is likely to be an underestimate. A change to accounting practices, which may be less controversial than are currently used by the University, which calculate depreciation only on assets that have lost value, for example, would significantly increase the surplus.
The College of Arts has the largest gross profit/surplus and is the third highest proportional contributor to the central University. Since it is producing a surplus, the perceived deficit arises after application of the contribution margin (39% in 2006 and 41% in 2007).
The University has not made available for scrutiny how the contribution margin is set. It is highly unlikely that the margin is set to an accuracy of 0.2%, to say 38.8% from 39%, a change that would eliminate the budget shortfall in 2006.
The Change Proposal fails to detail the effect of PBRF on revenue and how the targeted redundancies would affect PBRF standing.
The Change Proposal fails to take account of the loss to the University of having invested in expensive and extensive library collections that, without associated academic staff and programmes, will lose their value.
The Change Proposal has not established that the net change in personnel costs will produce a net positive change in University revenue. While resignations reduce staff costs, they do not increase revenue. In fact, they will likely lower revenue because forced and unintended resignations in the short-term will result in a lower overall capacity for teaching and research. Illustrated with budget 2006 numbers, a revenue of $41,769,000 and margin of 41% would be required to produce the same contribution to the University as the expected revenue of $43,911,000 and a margin of 39%. In other words, a 5% decrease in revenue would neutralize the gains of a 2% increase in the contribution margin. A detailed financial plan that illustrates the expected loss of revenue from decreased EFTS and PBRF income in a smaller College of Arts is necessary to justify the redundancies.
There is a strong argument to reconsider the timeframe of the Proposal. The case for urgency is weak. The Government is sending strong signals that it is about to make changes to tertiary funding. Unlike other times of change, the Government is indicating that the changes will increase funding stability over longer time periods. This direction is at odds with the Change Proposal, which is based on short-term trends.
b. Human and academic costs not adequately considered.
By fixating on a limited financial model (provided by the contribution margin), the University may not be recognizing all the relevant costs of its actions and not making appropriate comparisons when rejecting alternative choices (including the choice to not pursue change through wholesale forced redundancies). In ignoring these direct and indirect costs of change through wholesale redundancies, the University achieves a false economy.
The AUS believes, and is informed by the experience of those who have weathered redundancy exercises in other academic institutions within New Zealand, that the immediate and long-term effects of redundancies has not been engaged by the University; at least the engagement is not apparent in the analysis provided in the Change Proposal. The AUS is concerned that the process, which is being conducted in the absence of any clear academic rationale for the College, is or may cause a damaging spiral effect on staff and students.
The perception by students that the College of Arts is a failure is likely to curb enthusiasm of current and potential students from pursuing their degrees at Canterbury. That perception is being driven by a management who portray the College as inefficient, unpopular and unsustainable; the reasons for such characterization being to justify the redundancies in the short-term. The long term harm may be that students and potential academic recruits come to accept this characterization as well. The perceptions of students and the depth of their feelings with regard to these cuts can be clearly seen by the level of activity and demonstrable support (petitions and rallies) of student groups such as Save Our Staff. We believe that senior management is underestimating the impact of the change process on generating negative student perceptions.
This effect is not limited to the Arts students. All students want to know that their chosen university is academically strong and respected.
Moreover, even transient disruptions to departments can have long lasting effects on the curriculum and student perceptions. Replacement staff joining an unhappy department, or starting up a new programme, or reviving a decimated programme, have a much greater challenge. That challenge takes its toll by increasing the chance of dissatisfaction, low productivity and turnover.
The process is causing an avoidable and undue level of stress because it is being conducted in a way that the critical thinking and analytical academic community can find no clear logic in (in the absence of an academic plan). The stress is expected to further demoralize staff and erode morale.
The flow-on effects of plummeting morale will be to make it more difficult to recruit replacement staff and retain highly productive staff.
Thus, the current process may be particularly qualified to undermine the expressed goal of making the College sustainable.
6. Alternative Proposals.
Attrition coupled to performance management would be a better way to effect change.
The Attrition Model
To protect the University’s responsibility as an employer of staff who act as critic and conscience of society, positions should be made redundant only after stringent planning and then supported until vacated by retirement, death, serious misconduct, failure to perform or voluntary resignation. Redundancies should not be used to correct hiring decisions made without proper planning.
We are conscious of the argued short-comings of the attrition model, specifically that attrition is not targeted to under-performing staff or areas, and that it is too slow and is “difficult” to get right.
In reply, we would argue that, if under-performing staff were also in under-performing areas, attrition allows change to be effected without causing increased stress and workloads for performing staff. Moreover, we note that active performance management can replace under-performing staff with more productive staff. Thus, the University gains even if it still carries the same number of staff salaries, and workloads are distributed more fairly among motivated employees. Finally, it is the responsibility of management to manage, regardless of how difficult it may be to do performance management correctly.
Past failures of management to actively manage performance is a cost that should not be borne by the College, and certainly not by individual members of academic staff. There is enough time and enough money to allow an attrition model to be imposed and work. In any case, the Change Proposal provides no evidence to the contrary.
We note that the managers of neither the College of Arts or the University as a whole have never approached the AUS to discuss performance management. We are also aware that performance management matters have been raised with College of Arts management by at least one Head of School and met with an unsatisfactory response.
7. Conclusion.
The University is in danger of forgetting that its principal asset is people. The Charter, in fact, defines the University only in terms of people. “The University of Canterbury comprises its staff, students, graduates and alumni” (Charter). The ways in which the Change Proposal has been framed provide insufficient justification for redundancies, and it probably has underestimated the human, academic and ultimately, productivity costs of its proposed mechanism of change. Long-term costs of this mechanism likely outweigh short-term benefits to the College and University. External (new directions in Government funding policy) and internal (change in the minimum annual contribution in the contribution margin model) changes or relevance to the College’s financial position are compelling developments that warrant a respite in the University timeline to effect change.
The affected academic community would likely provide alternative strategies for Change, but they are limited by an arbitrary timeframe for consultation (one month during a major national holiday), access to the necessary data, and by a planning vacuum because there is no College academic plan. The University has failed in its Charter obligation to create an environment of parity esteem and dialogue with staff and thus should reconsider how it manages this consultation.
The over-riding weakness of the Change Proposal is that it does not articulate academic or strategic reasons for redundancies.
What makes it all the more disappointing is that management has spurned early and repeated AUS offers of cooperation by our members in developing a change proposal for the College of Arts. In making this offer, we have not insisted on a position of no forced redundancies. We accept that institutional change is normal and warranted to enhance the mission of the university and the effectiveness and careers of our members. Our only condition was that the unnecessarily short time frame for achieving the change be relaxed in order to allow the space for the development of a change proposal that is consistent with the Charter and Profile.
The AUS offer of cooperation remains. We hope and trust that this submission, along with others from within the University of Canterbury and the wider community to whom the university also has obligations, will lead to the suspension of the current process and the launching an alternative, superior process that gives genuine effect to the Charter and Profile.
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