Insurance hike adds to debt woes
Canterbury University's insurance premiums have shot up 600 per cent to an estimated $7 million next year as the institution battles increasing debt.
The premium hike comes as the university (UC) faces a repair bill of more than $600m to fix and strengthen its 345 buildings following the 2011 earthquakes.
Work planned for 2013 alone is estimated at $84.5m.
To cope with the crippling costs and lost teaching space, the university has cut courses and aligned faculties.
In the next three years 150 staff will be made redundant.
A university spokesman said the university was "currently in a very serious financial situation and like any business will continue to monitor and fine-tune staffing levels to ensure that it is using scarce resources in a justifiable manner.
"Our intention is to continue to rebuild both student and staff numbers back to pre- earthquake levels as quickly as the university's finances allow."
UC was hit hard by the 2011 earthquakes, which saw its insurance premium rise from $1m to $7m next year.
Its 10-year financial forecast, released last month, revealed it was losing $100,000 each business day and debt would increase from $50m to $118m in the next decade.
Earthquake strengthening and building refurbishment is a major factor in the spiralling costs.
All buildings will be strengthened to at least 67 per cent of the building code, the spokesman said, "to provide a safe working environment for staff and students".
"On current estimates there is $86m of strengthening work required to achieve this."
Remediation work is covered by insurance.
But all non-earthquake related work is taken from University of Canterbury coffers.
Eight campus buildings are closed awaiting earthquake-related works and two others have been demolished.
To allow for the necessary earthquake repairs, UC has to take a hard line on programmes.
In June, American studies and operations research programmes were axed, and Adult and Community Education is also on the chopping block. UC announced last week the School of Law would be aligned with the College of Business and Economics.
The two faculties will share the law building.
The law library will move permanently to a floor of the central library tower.
The spokesman said the remediation work was anticipated to cost between $2m and $3m.
- © Fairfax NZ News
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