By Higher Education Reporter TRACIE McPHERSON

THE University of Adelaide has incurred a $6.36 million operating loss, raising the spectre of more spending cuts.

It is the worst financial performance of any of Australia's top eight universities and follows the shedding of more than 150 jobs in the past 12 months, the amalgamation of schools and departments and increased staff-student ratios to rein in expenditure.

The alarming loss is in stark contrast to the second worst performer, the University of Western Australia, which boasted a $20.26 million profit.

The University of Sydney posted the best profit last year – $88.8 million.

The University of Adelaide had budgeted for a loss of $3.2 million.

When queried about the financial performance, a university spokesman yesterday was unable to confirm whether the institution had moved out of the red, or even if it had met budgetary requirements for the current financial year.

"We have moved beyond 2001," was all he said.

However, there is widespread concern in academic and students circles about the university's future.

"The situation is shaky," the university's head of linguistics, Professor Peter Muhlhausler, said. "The university's reputation and financial future has been jeopardised by the cuts.

"Cutting staff is about the worst of all long-term strategies and the university has been getting rid of the expertise in all sorts of areas.

"At a certain level we may be forced to get rid of whole areas."

Other staff members, who declined to be named, told The Advertiser the financial position was critical.

Professor Muhlhausler said recent cost-cutting had failed to resolve the financial woes.

"The cuts and restructuring are detrimental . . . constant restructuring does not lead to greater economies," he said.

"Our university is not very rich in land and the infrastructure is not the best – it needs a lot of work. We (staff and students) absolutely should know what the state of finances are.

"We hear sweeping statements but no real information."

In 1996, the university had an operating surplus of $17.2 million.

Just five years later, it recorded the operating deficit of $6.3 million.

The so-called Group of Eight, a coalition of Australia's leading tertiary institutions, comprises the Adelaide, Australian National, Sydney, New South Wales, Melbourne, Monash, Queensland, and Western Australia universities.

Aiming to be world-class standard, the group undertakes 70 per cent of all research conducted at Australian universities, and attracts more research students than all other Australian universities combined.

Group of Eight president John Hay said yesterday he could not comment on the loss.

"It is a matter for the internal governance of the university," he said.

Professor Hay, the University of Queensland vice-chancellor, also indicated the financial performance would not jeopardise Adelaide's position in the group.

Revelations of the University of Adelaide's financial strife came as Premier Mike Rann last night told an education industry dinner in Shanghai that enticing more Chinese to study at South Australian universities was crucial.

He said the number of students coming from China had trebled over the past two years with more than 1000 studying in SA this year.

"Chinese students contribute nearly $25 million to SA's economy each year," Mr Rann said.

He said Education Adelaide offices in Hong Kong and Tokyo had attracted an additional 2000 international students to Adelaide universities in the past few years.