UQ’s Budget Contribution Model An Overview VC Forum Head of Schools Workshop September 14, 2012

1. UQ’s Budget Contribution ModelAn OverviewVC ForumHead of Schools WorkshopSeptember 14, 2012

2. Introduction • What is the BCM? • BCM ~ Centre to Faculty • Structure of the BCM • BCM Drivers • University Funding Model – BCM Distribution • BCM ~ Income • BCM ~ Central Overheads • BCM ~ Infrastructure Support Costs UQ’s Budget Contribution Model

3. What is the BCM? • Mechanism for distribution of income and allocation of costs • Not all income • Not all costs • A common misconception is that the BCM is the budget • The BCM is an input into the budget process UQ’s Budget Contribution Model

4. What is the BCM? • The BCM is used to: • Distribute CGS Block Grant income to Faculties and Institutes • Distribute CGS Research (Secondary Gains)to Faculties and Institutes • Allocate Central Overhead against Faculties and Institutes UQ’s Budget Contribution Model

5. What is the BCM? • The following income is not included in the BCM: • Research Income • Trading income • Investment income • Donations, Scholarships and Bequests • The following expenditure is not included in the BCM: • Direct costs at Faculty and Institute • Capital Expenditure from tied income sources UQ’s Budget Contribution Model

6. BCM ~ Centre to Faculty • The BCM is a conduit between the Centre and the Faculties and Institutes • The Faculty may in turn distribute income in accordance with its own mechanism • The Faculty may allocate costs in accordance with its own mechanism • Portion of Central Overhead as levied upon it • Allocation of Faculty Overhead • Running the Faculty Office • Faculty Initiatives (Strategic) UQ’s Budget Contribution Model

7. Structure of the BCM • Income • CGS Block Grant • Secondary Gains on Research (Research Block Grant) • Tuition Fees • Deductions • Central Costs • Infrastructure Support Costs (Repairs and Maintenance, Insurance) • Strategic Initiatives • Debt Servicing • Capital UQ’s Budget Contribution Model

8. BCM Drivers • Income distributed and costs (deductions) allocated to Faculties and Institutes on the basis of selected drivers • The cost or deduction driver is not activity based costing. • Has been determined as a reasonable proxy for resource usage • The drivers are influenced by UQ’s strategic objectives. • For example, Research EFTSL and Research secondary gains are not included in overhead calculations UQ’s Budget Contribution Model

9. BCM Drivers ~ Income UQ’s Budget Contribution Model

10. BCM Drivers ~ Costs • Drivers Include: • Funded EFTSL • Weighted Funded EFTSL • International EFTSL • Non Research EFTSL • Staff FTE • Space • Total Income (BCM) • iCEVAL • Examples: • Library • 50 % Staff FTE • 50 % Non Research EFTSL • DVC I • 100 % International EFTSL UQ’s Budget Contribution Model

11. BCM Drivers ~ Costs UQ’s Budget Contribution Model

12. BCM Drivers ~ Data Sets UQ’s Budget Contribution Model

13. University Funding Model ~ BCM Distribution Total Effective Distribution to Faculties and Institutes $ 534 m 61 % of BCM Income • Distributed through the BCM 2012 • > Faculties and Institutes $ 407 m • > Central Costs (1)$ 272 m • > Strategic Funding(2) $ 83 m • >Strategic Funding (3) $ 58 m • > Debt Servicing $ 15 m • > Capital $ 47 m BCM $882 m • * CGS Block Grant $ 448 m • * Research Block Grant $ 146 m • * Tuition Fees $ 288 m $ 127 m (4) Note (1)~ Much of these incurred on behalf of total UQ Note(2)~ Discretionary Strategic Funding Note (3) ~ Direct Flow through for RIBG, SRE, APA Scholarships, HEPP Note (4) ~ In excess of 90 % of Strategic Fundingflows back to Faculties and Institutes UQ’s Budget Contribution Model

14. Direct Revenue Distributions (2012) Faculties And Institutes Domestic Load Modelling • CGS Block Grant • C’wealth Contribution $269m • Student Contribution $167m • Tuition Fees • International $258m • Domestic $ 30m • Research Block Grants • JRE $ 30m • RTS $ 56m • SRE $ 11m FFI Tuition Fee Modelling Research Performance UQ’s Budget Contribution Model

15. Research Block Grants Research Income 40% RHD Load 40% RHD Awards 10% Publications 10% Category 1 Income moderated by ERA Fellowships/Infrastructure Direct to Scholars via DVCR JRE $ 30m RTS $ 56m SRE $ 11m SRE $ 5m APA $ 20m RIBG $ 24m

16. Load Models • One Commonwealth-supported domestic model • Four international tuition fee models • Undergraduate • Postgraduate Coursework • Postgraduate Research • Non-award • Three domestic tuition fee models • Undergraduate • Postgraduate Coursework • Postgraduate Research

17. Load Models TOTAL EFSTL 2012Actual by program CONTINUING EFTSL 2013Model COMMMENCING 2013Faculty Estimate TOTAL EFTSL 2013 Legend SCHOOL/SUBJECTAREA EFTSL SPLITS 2013Based on Historical Patterns Modelling Process Faculty / Institute Input Known Value FUNDING BAND/COURSE FEE RATES 2013Actual REVENUEBy program, faculty etc

18. Load Models CONTINUING EFTSL 2013Model Granularity: Program and Program Year Retention: Semester on Semester Based on 3 year history Distribution: 1 year history (annualised) Schools Tuition Fee Band or CGS/SCC Band

19. Load Models COMMMENCING 2013Faculty Estimate • Granularity: Semester • Program (International) • Program and Program Year (Dom)

20. Faculty Funding Index • BCM: • International tuition fees passed through ‘as earned • Domestic load weighted by Faculty Funding Index • Faculty Funding Index: • A multiplier that is applied to Faculties’ student load (EFTSL) to calculate the weighted student load (WEFTSL) • Representative of Commonwealth Funding Bands • Moderated for scale FFI

21. Faculty Funding Index Commonwealth Funding Clusters 2011 Data

22. Faculty Funding Index Commonwealth Funding Clusters 2011 Data

23. Faculty Funding Index Commonwealth Funding Clusters 2012: Variance “Theoretical” FFI to Actual FFI <.019

24. Questions?