In short:
The University of Tasmania's finances face twin problems of large debts and little revenue coming in, an economist who fronted a parliamentary inquiry says.
asserted
who → face → inquiry
UTAS had tried to move into the Hobart CBD and sell off its Sandy Bay campus to raise funds, but has had to largely abandon those plans.
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UTAS → try → plans
A parliamentary hearing into the university's 2025 annual report will be held next week, with UTAS officials, including vice-chancellor Rufus Black, expected to answer questions.
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officials → hold → questions
The University of Tasmania faces a liquidity crisis, with $355 million in borrowings and financial pressure mounting from loss-making operations, a state parliamentary inquiry has heard.
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inquiry → face → operations
One economist involved in the inquiry has told the ABC that UTAS's plan to shift into the Hobart city centre from its nearby Sandy Bay campus was based on "expecting blue sky to last forever", but the COVID pandemic put an end to that.
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pandemic → involve → that
A closed briefing last week heard from invited organisations and individuals, including the National Tertiary Education Union, the Save UTAS campaign, independent economist John Lawrence and UTAS Papers blogger Robert Hogan, who has campaigned for greater transparency at the university.
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who → hear → university
The briefing will inform committee members ahead of a public hearing with university officials next week, including vice-chancellor Rufus Black, who will answer questions about the 2025 annual report, tabled in state parliament in June.
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who → inform → June
The hearing will be the first of its kind and held annually, to provide the same ongoing scrutiny to the university as is given to government business enterprises.
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hearing → hold → enterprises
Economist John Lawrence said the university's 2025 accounts revealed "a decade of financial engineering" had left it with little room to manoeuvre.
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decade → say → room
UTAS announced its plan to spend $600 million to relocate from its Sandy Bay campus to the Hobart CBD in 2019, buying up multiple city properties for redevelopment.
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UTAS → announce → redevelopment
It later released controversial plans to develop 2,500 homes plus aged care and tourism precincts at Sandy Bay.
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It → release → Bay
Pandemic scuttled CBD plan for sell-off and move
John Lawrence told the ABC that UTAS' key financial decisions were made before the COVID pandemic.
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decisions → scuttle → pandemic
"All the decisions were made expecting blue sky to last forever," he said.
"
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he → make → ?
They were going to accumulate a big pool of cash, they were going to spend it, they were going to redevelop Hobart, and then they were going to sell Sandy Bay.
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they → go → Bay
They would just be overflowing with riches as they sold off something like 2,000 apartments.
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they → overflow → apartments
"But when COVID struck, the whole thing turned sour.
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thing → strike → ?
The build-up in international students just ceased.
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up → cease → students
"They had no plan B."
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They → have → ?
Mr Lawrence, who is a public policy analyst retained by independent Member for Murchison Ruth Forrest, said the 2025 accounts showed UTAS had $1.3 billion in net assets, but a steep decline in cash and so-called "unrestricted assets".
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UTAS → retain → cash
Unrestricted assets are available to sustain operations, service debt obligations and fund maintenance and development, while restricted assets, such as research grants, scholarships, bequests and endowments, which are essentially held in trust and can only be used for the intended purpose.
UTAS's unrestricted assets fell from $530 million in 2022, according to Mr Lawrence's estimates, to just $112 million in 2025.
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assets → sustain → 2025
"UTAS has always appeared to have had lots and lots of cash and not to be in any danger, but it has transpired that a lot of the cash that they have is actually restricted, that it is not available.
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it → appear → that
[To me] that was the most stunning thing that came out of the 2025 annual report.
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that → come → report
They've got plenty of assets, they're solvent, but they don't have a lot of usable assets.
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they → get → assets
And there is a danger that in the next few years that they will run into real strife."
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they → be → strife
Mr Lawrence also said the university had borrowed too heavily, raising $350 million through "Green Bonds" due to be repaid from 2032 and another $203 million in a one-off sale of the right to collect future rents from student accommodation to an external provider, Spark Living.
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university → say → provider
Given interest rate rises since the Green Bonds were issued, the cost of servicing this debt is likely to increase sharply when the first tranche of $280 million falls due in 2032.
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tranche → give → 2032
Refinancing costs loom
Dr Robert Czernkowski, senior lecturer in accounting at the University of Technology, Sydney, told the ABC that UTAS was "an outlier" in terms of debt levels, with borrowings as a proportion of assets hovering around 16 per cent.
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borrowings → loom → cent
"It's definitely near the top end of unis in the same size category by assets," Dr Czernkowski said.
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Czernkowski → say → assets
"They're not going down the tube, but neither are they growing or showing a lot of potential to improve their position.
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they → go → position
"
Credit rating agency Moody's, which recently upgraded UTAS' rating from negative to stable, counts these student accommodation arrangements as a form of debt, lifting the university's effective borrowings to more than half a billion dollars.
Moody's analysis assumes that UTAS' debts would be guaranteed by the state and/or federal governments if it went into serious financial strife.
Dr Czernkowski said that with interest rates rising, the issue for UTAS was not whether it could refinance its Green Bonds, but how much it would cost.
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it → upgrade → much
"Even a one per cent move is going to push them back into deficit," he said.
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he → go → deficit
UTAS rejected suggestions that it was an outlier in terms of debt levels, pointing to the recent Moody's credit ratings upgrade and to its preferred ratio of debt to equity, which was sitting at 26 per cent — in line with the sector average and below the 30 per cent limit imposed by the university's governing council.
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which → reject → council
This compared favourably to the University of Wollongong (68 per cent), University of Western Sydney (59 per cent) and Macquarie University (39 per cent).
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This → compare → Sydney
UTAS argues that, like other regional universities, it faces higher operating costs due to its smaller scale and greater distances between campuses.
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it → argue → campuses
In a written statement to the ABC, the university's chief financial officer Ben Rose said UTAS had been "very clear about the impact of a volatile operating environment for universities on our financial position, particularly the impact of sharp drops in international students caused by COVID and changes in government policy".
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UTAS → write → policy
"Our 2025 Annual Report shows that we remain on track to return to a long-term sustainable position that will enable us to meet current obligations and support future capital investment."
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that → show → investment
Mr Lawrence said the university's core earnings were negative, and that unrestricted or usable assets had collapsed while restricted assets had surged.
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assets → say → ?
"You can rearrange the balance sheet, refinance debt, sell assets or exchange future income for cash today," Mr Lawrence wrote.
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Lawrence → rearrange → cash
"Each may buy time or create options.
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Each → buy → options
What you cannot do indefinitely is transact your way out of an earnings problem."
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do → transact → problem
…and 9 more, not listed.
The Aporia
