Research: a loss-making activity?

8 September 2011

For a little while now there has been whispering in some quarters about whether research is, or is not, regarded at the University of Sydney as a 'loss-making activity'.

I find the way in which this question is framed frankly quite baffling, at least if it implies an assumption that 'loss-making' means 'undesirable'. It is like asking whether my five children are or are not 'loss-making' just because they are not in full-time paid employment and could not afford to feed, clothe and house themselves. The way in which the question is framed demonstrates the deeply mistaken assumptions upon which those who ask it may be operating.

Research is, and always will be, the life-blood of this institution. It is into a research community that we invite our students as apprentices. Research is therefore foundational to teaching as well as an intrinsic good. It is for this reason that our new University economic model has an explicit cross-subsidy from teaching to research.

That said, as we have always argued to the government, research in Australia is chronically underfunded. This remains the case even after account is taken of the extra funding received as a consequence of the Cutler Review. Some, but not all, of our research therefore costs the University more than we receive for it in income. In that narrow and technical sense it may be regarded, like my children, as 'loss-making'. But like them, it is of incommensurable value.

The challenge for the University is to ensure that we do everything we can to maintain, and build, excellence in both teaching and research. This is not easy in a financially constrained environment. It means that we cannot afford waste at any level. We need collectively to wring excellence from every dollar. And we need to do that, not for the benefit of the profit and loss statement, but for the benefit of our students and researchers. It is their flourishing that is at the heart of our current strategy.

Dr Michael Spence
Vice-Chancellor and Principal