There is a particular kind of frustration that accumulates in universities. It’s the result of being told the university is poor, that there are uncertainties and headwinds that could turn into storms, that students are turning away, or failing to enrol at the rates the executive projected, that everyone must tighten their belts. And then watching new buildings go up. Hearing about investments in AI infrastructure. Reading another email about a new Pro Vice Chancellorship invented, another article about executive pay or wage- and time-theft from teaching staff.

When you question the balance between capital and labour, between asset accumulation and the people doing the teaching and research, perhaps noticing which new units were capitalised and which established disciplines bore the cuts, the executive answer is always vague. What gets resourced and what gets restructured was already determined upstream, by people who construct the measures but often have little first-hand knowledge of the work those measures are supposed to serve.

The deeper problem is institutional. Universities have elaborate mechanisms for scrutinising knowledge claims circulating between staff and students. But we have remarkably weak mechanisms for scrutinising the financial assumptions through which executive power is exercised.

Numbers without methodology

The structural asymmetry in university governance starts with the CFO. The Chief Financial Officer’s department constructs the financial reality that everyone else reasons from, or questions at great personal risk. The executive administers the CFO’s measure, adopts a particular definition of institutional sustainability, excluding selected revenue streams and balance sheet resources from the measure used to guide decision-making. No independent analytical voice reviews the premises. The Academic Board has no formal role in scrutinising the assumptions before restructuring decisions are made. Staff and students have no prior access to the methodology.

The number arrives as fact, albeit over cooked. But this is not corruption. It is institutional fiat power. The normal uses of financial power in the public university are typically about demarcating “operational” matters from academic concerns. We most-often begrudgingly accept the opaque dealings between executives over College budgets, but Renew ANU — the harmful restructure that aimed to cut $250 million from staff, operations and the colleges — revealed neither the portrayed financial position nor the internal budget decision-making was sound. Increasingly, financial measures were being used to produce crises and divest from whole areas of inquiry, even when the audited accounts show surplus.

The audited accounts of the Australian National University showed a surplus for the last three years: $135 million in 2023, $90 million in 2024, $117 million in 2025. In each of those years, the executive reported an “underlying operating deficit.” The gap was produced by excluding from the audited result the following entries: investment fund income, philanthropic funds, restricted specific purpose funds, and other one-off items, totalling $232 million in excluded revenue in 2024 alone. None of these exclusions were endorsed by the auditor. No documented methodology governed them. On the basis of these measures, ANU Council approved a $250 million restructure generated via $1.2 million spent on cookie cutter consultancy fees. The ANU restructure cost $35.9 million to deliver $74.8 million in savings.

The Australian National Audit Office (ANAO) found that in 2024, $459.7 million (30.9 per cent) of ANU’s investment assets were unrestricted. Across its full investment pool, the university generated $175 million and $215 million in investment income in 2023 and 2024 respectively. Investment income, philanthropic funds and restricted purpose funds are recurrent features of university operating models. They supplement declining public grants and tuition income with returns from financial assets built up over time.

That universities rely on this financial strategy reflects a structural tension in how higher education is funded, but it does not excuse executives from reporting transparently about their recurring use of it. ANAO points to the Australian Securities and Investments Commission’s guidance, which states that items recurring across multiple years should not be described as one-offs. Several of these exclusions appeared in ANU’s accounts in every year across a decade, but none were disclosed as methodology to Council. The ANAO also found these assets could be readily realised to meet financial obligations if required. Standard and Poor’s maintained ANU’s AA+ credit rating throughout, citing high available financial resources and low debt servicing needs. TEQSA assessed ANU as a low financial sustainability risk.

Not one independent external assessor saw a crisis. It existed entirely in the unaudited operating measure.

None of this implies that ANU faced no long-term financial challenges, or that potentially volatile investment earnings alone should determine operational spending. The issue is that the CFO’s particular definition of sustainability, embedded in the “underlying result”, should not have been treated as the only legitimate basis for institutional decision-making. ANAO found that six weeks before the August 2024 decision, Council discussed drawing on investment accounts and adopting a multi-year approach. Neither was developed into a proposal.

ANU sits among the top six Australian universities by total assets (see figure 2.2 of ANAO’s report). This reflects more than a decade of decisions to prioritise capital investment and asset accumulation over the labour that produces a university’s public value: the time of its scholars, the depth of its teaching relationships, the conditions that make genuinely novel research possible.

Headwinds and the feeling of being governed by numbers

In the public university, financial measures have become the primary language of institutional authority. In Economy and Society, Max Weber distinguished between formal rationality — the numerical accounting of capital — and substantive rationality, or the actual satisfaction of the values and purposes an institution exists to serve. Capital accounting measures the first and cannot represent the second — like whether there has been enough resourced time to sit with a student struggling to define a research question, to design a class that gets students doing things rather than absorbing content, to form a research group and negotiate with a funder. These are substantively rational expenditures. The intergenerational work we do is the public university’s most essential long-term asset, but formal accounting records it as a cost to be minimised.

The underlying operating result is an instance of formal rationality applied to an institution whose public value is substantive. The institutional problem isn’t that the CFO uses numbers. It is that the numbers chosen systematically exclude the income streams that have been sustaining our work and present the resulting gap as the institution’s operational reality. At ANU, investment income, philanthropic funds, restricted-purpose funds and other recurring items have been supplementing the decline in public grants and tuition support from the Federal government year-on-year. But the executive has chosen to discipline university labour with that operational tension rather than account for it honestly. Facing waves of Change Proposals, hundreds of staff wrote to the executive asking to see the evidence and basis for deficit calculations but received no thorough substantive response.

Weber called the rationalised bureaucratic order an iron cage: the inescapable compulsion of a rational-legal order that distributes resources and forecloses alternatives without open deliberation. At ANU, a particular way of seeing was legitimised through repetition of the executive’s preferred metrics rather than reason and evidence-testing. The cage was the deficit metric itself. For some time, it’s been inescapable because the procedures of governance gave it institutional force. The irony is that the metrics themselves failed on their own terms as measures of the public value ANU executives are hired to steward, and the auditor, TEQSA, and Standard and Poor’s all said so.

The iron cage has affective consequences. Rosalind Gill’s account of academic labour shows how the pressures of audit and performance management are internalised as exhaustion, anxiety, shame and chronic insecurity. These are private difficulties structured by our work conditions and managed by HR advice on self-care and “RU okay?” days. They are the predictable effect of a governance architecture that keeps you anxious and striving, worried about the future.

Our former Vice Chancellor was fond of headwinds discourse to cultivate these affective states. You do not need coercion if the governed are already pre-emptively anxious about enrolments or whether their discipline will survive the next budget round. Uncertainty, named and repeated, is itself a form of discipline.

Executive education

Five days after the ANAO report was tabled, ANU held a community meeting. Three executives presented from the low-set lounge chairs normally reserved for visiting keynote speakers and book launchers. No CFO. No PowerPoints or bar graphs or substantive engagement with ANAO’s findings. It’s not entirely clear what has been learned.

The acting Chancellor opened with a sincere acknowledgement of governance failure, described the ANAO report as “the most damning” he had seen in his public sector career, and noted that new executives were coming with diversity credentials. The Interim Vice-Chancellor repeated familiar claims the ANAO report had directly contradicted: assets we cannot use, enrolments not where we had hoped. The Chief Operating Officer (COO) named familiar headwinds and promised a future budget model that will incentivise staff to generate revenue.

The meeting amounted to apologetic denial, and a promise to push us harder for revenue our work is already generating on a healthy audited basis.

I submitted a question, asking about ANAO’s findings and why the audited net operating result had not been the primary measure put to Council when seeking approval for a $250 million restructure, and whether Council had questioned or debated the unaudited figures. It had no chance of circulating before the questions closed. Understandably, the questions expressing frustration, a lack of trust, and fear rose to the top of the Slido platform feedback mechanism.

I walked away without lingering — back to student meetings and marking, and the research that I fit into the spaces between. On the way out, my colleagues were musing on the COO’s new budget model “incentives” and “revenue” principles, noting the previously promised “co-designed” budgets have not arrived. I privately shared a forecast:

“Sigh. Prediction: they will design a budget model that puts us on a treadmill of performance anxiety with whatever comes next, incentives-wise.”

Then we fell silent. Back to work.

The community keeps meeting

Something has changed at ANU. The ANAO’s report, described by the acting Chancellor as damning, has placed on the parliamentary record that the “Renew ANU” crisis was constructed and the financial alternatives were never put or debated by the Council. The staff who questioned the financial information at the time have been vindicated by our institution’s auditor.

The Interim Vice Chancellor had the right instinct to rename the restructure townhalls as community meetings. There are hundreds of staff and students who now read executive decisions closely and cross-check the underlying deficit against the audited result. They know what AA+ means and what TEQSA and the ANAO said.

The ANU community will not accept this again.

In an institutional architecture designed to make financial power invisible, we have a lot more work to do. As Taflaga, Markham and Dowding argue, we need legislated internal accountability bodies with genuine authority to scrutinise executive decision-making. The ANAO report shows that scrutiny needs to start before the numbers reach Council. The CFO’s assumptions about what counts as income and what gets excluded from resourcing allocations should be open to public challenge before they harden into labour-disciplining facts.

The urgent task is to articulate what participatory budgeting would look like ahead of the COO’s new budget incentive structures, which risk narrowing and fragmenting our collective work further. Community oversight of how income is defined and allocated. Academic Board with a formal role before the measure is fixed. Or dare I say, a majority elected University Senate.

The community keeps meeting. The cage of financial bureaucracy is visible and looking weaker.