THE vice-chancellor of the PNG University of Technology, Prof Albert Schram (pictured), has told Radio New Zealand International that the PNG Treasury has announced that all universities will have their funds cut by 40% for the rest of 2015.
The disclosure follows recent independent analysis of the nation’s budget which, despite denials from prime minister Peter O’Neill, shows significant revenue problems.
Paradoxically, Mr O’Neill indicated last week that a slump in the economy would somehow be good for PNG. He agreed with ANZ Bank chief Mike Smith that the resources boom allowed PNG to paper over weaknesses in the system and so the downturn now is "not such a bad thing."
Too many people had become complacent about forecasts that the country would grow by up to 20% this year, Mr O’Neill said. But he also gave assurances that the government “won't be resorting to indiscriminate budget cutting” which followed an earlier government commitment that educational institutions would not be impacted by budget cuts.
But it seems these assurances were paper thin, and that money is rapidly running out for the delivery of government services across the board.
Prof Schram warned that courses or teachers at Unitech might need to be cut if the funding cutbacks are not reversed.
“All the university bursars this year were called to Treasury on 10 June and cuts of 40% for the rest of the year were announced,” Prof Schram told Don Wiseman of RNZI.
“Of course we protested because we have students here on campus and we need to provide the teaching and services.”
Prof Schram said that, while the full reduction had not yet been applied, Unitech had a cut of about 15% in July.
PNG Treasury had also applied monthly transfers of funds rather than providing them for a longer period which made it “very difficult to run the university.”
“It's actually the uncertainty that makes it very difficult to manage the situation because, if there would be clear prospects, then you can adapt,” he said. “But we simply don't know what's going to happen next month.”
Prof Schram said he had instructed his managers and heads of department to make cuts across a range of spending areas like allowances, transport and unnecessary travel but it was evident the university will have to go much further in its savings measures.
He said the “breakdown point” could be reached very soon.