RMIT VC MARTIN BEAN AND CFO KATE KOCH VIDEO 8 APRIL 2020
[START OF TRANSCRIPT]
VISUAL: RMIT Vice-Chancellor Martin Bean sits and talks directly into camera
MARTIN BEAN SPEAKS: Hi everyone. Firstly, I want to recognise and thank you for all the work that you’re doing to support our RMIT community, it has been incredible.
We have learning and teaching happening remotely online at scale.
We’re running the University from thousands of homes instead of many offices.
We’ve changed processes, moved deadlines and introduced special leave.
And, more important than anything, we’ve helped the people who’ve needed it most.
We’ve extended our employee assistance program, we’ve been there for our students on the phones and online, and we’ve made $10 million available to our students, both domestic and international, who are struggling with the impacts of COVID-19.
It’s been a massive team effort and I’m so proud of the way we have responded.
However, like most organisations, we’re already feeling the financial burden of the pandemic and we need to be very realistic about what that means for us moving forward.
I’ve asked our Chief Financial Officer Kate Koch, to explain what it means for RMIT and what steps we’re taking to manage through the tough months ahead so we’re setting ourselves up for a sustainable future.
Over to you Kate.
VISUAL: RMIT Chief Financial Officer, Kate Koch stands and talks directly into camera
KATE KOCH SPEAKS: Thanks Martin.
That’s right, the financial impact of COVID-19 across the economy is significant. We’re seeing it every day in the news.
From RMIT’s perspective, initially we thought the impact on our revenue was going to be a result of the international students who couldn’t make it onshore to our campuses in Australia.
The impact became a whole lot bigger when it was declared a global pandemic and reached the shores where our campuses are located.
What a difference a couple of weeks has made.
We now need to plan for the likelihood that new International students who intended to commence in Semester 2 won’t be able to make it onshore or may choose not to study online with us, which will have a significant impact on our revenue.
Our student recruitment team will of course be working hard to minimise this and are actively promoting our online learning capabilities to new students, but we need to prepare for what could be a reduction of close to 30 per cent in our international student revenue.
We’re also seeing a softening in domestic demand and need to assume up to a 10 per cent reduction in domestic enrolments across the year.
As of today, the overall estimated reduction in student revenue for Australia is at least $200m less than what we budgeted for 2020.
The challenge we face is that our plans and our costs were based on a very different scenario. So, quite simply, our monthly costs are now more than our monthly revenue if we don’t make some important changes.
We’re already taking action, in a careful and coordinated way, as ‘One RMIT’ and making sure that we’re continuing to invest in the wellbeing of our staff and students.
We have been actively putting sound measures in place to reduce discretionary spend to get ahead of the game.
For example, we’ve stopping new recruitment, we’ve reduced our spend on training and conferences, and paused some significant activities including capital expenditure on our building works.
We’re also making savings on travel as everyone is staying close to home.
This is all making a difference and there’s no doubt our expenses will continue to reduce over the coming months while we operate differently, however we need to be realistic that we’ll need to find more ways to save as we progress.
We’re well-equipped to do this and I’m very optimistic that we’re going to manage through these challenging times successfully and keep working towards our future ambitions.
Over the coming weeks we’ll be providing more detail on our plans to realign our spend and how you can contribute.
Thanks again for your support. Back to you Martin.
VISUAL: RMIT Vice-Chancellor Martin Bean sits and talks directly into camera.
MARTIN BEAN SPEAKS: Thanks for that Kate. When you say we need to act as ‘One RMIT’, you’re so right.
We’ll use a calm and careful approach that allows us to care for our people and our students, while ensuring our financial sustainability, because that’s what makes everything we do possible.
My Vice-Chancellor Executive team and I have agreed to contribute by taking a 20 per cent reduction in our overall remuneration over the coming months as we navigate through the financial uncertainty.
Finances aside, I know this is a really difficult time and that some of you are under a lot of strain.
Please look after yourselves and the people in your lives.
Take time for what matters and ask when you need support.
RMIT will continue to transform lives during this pandemic and for the decades that follow, and we’ll do that because of you.
What you do matters and I want to thank you for your passion and your purpose. Take care.
[END OF TRANSCRIPT]
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