a merger that failed: the case of the university of new england

@ Basil Blackwell Ltd. 1993, 108 Cowley Road, Oxford OX4 lJF, UK and 238 Main Street, Cambridge, MA 02142, USA. Higher Education Quark+ 095 1-5224 Volume 47 No. 2, Spring 1993

A Merger that Failed: The Case of the University of New England Grant Harman, Professor of Educational Administration, University of New England

Abstract

In 1989-90 the University of New England combined with three colleges of advanced education in northern New South Wales to form a network university. Unfortunateb the merger negotiations and the experience of this network university were marred by conflict and the network University is to split into two separate universities from I January 1994 at the latest. The paper provides a case-stuuy of the merger and tries to explain why the merger failed.

Introduction

Case-studies of mergers in higher education tend to be tales of success, or at least of limited or partial success. In contrast, this is a story of failure to the extent that an amalgamated university formed in Australia in the late 1980s seems certain to break up into at least two separate universities. The case-study is of the network University of New England (UNE), formed by combination of a well established university with three colleges of advanced education (CAEs). The first stage of the merger took place in July 1989 when the former UNE merged with the Armidale College of Advanced Education (Armidale CAE) and the Northern Rivers College of Advanced Education (Northern Rivers CAE). The UNE and Armidale CAE were located in the town of Armidale on the northern tablelands of New South Wales, while the Northern Rivers CAE was located at Lismore on the north coast of the same state, close to the Queensland border and about five hours by car from Armidale. The second stage of the merger was achieved in January 1990 when Orange Agricultural College, located in the central west of New South Wales about seven hours by car from

A Merger that Failed 121

Armidale, joined the network. Just prior to the July 1989 merger, the UNE had gained Commonwealth Government approval and funding to begin degree courses in the north coast town of Coffs Harbour, east of Armidale. In 1991, the Coffs Harbour branch gained recognition as a separate University centre.

A great deal of effort as well as time and money went into achieving and developing the network UNE. However, despite some worthwhile achievements, especially in expanding the range of courses available and in new academic initiatives, the amalgamated University was plagued from the start with a high level of conflict, especially between the two major campuses, and now is certain to split apart. This paper provides an account of how the merger came about, describes the problems encountered by the amalgamated university, and attempts to explain why the merger failed.

Accounts of merger failure are almost totally absent from the scholarly literature of mergers in higher education for two main reasons. First, few major mergers have produced such conflict that disamalgamation followed after a brief period, and second, generally participants in mergers prefer to write about achievements and difficulties overcome, rather than about failures. Thus it is not surprising that the literature on mergers is mainly in the form of case-studies of successful mergers (e.g. Millet 1975; Harman, Beswick and Schofield 1985; Carr 1985; McKinnon 1988; Birley 1991; Wedderburn 1991), and studies of the overall strategy and results of system-level mergers (e.g. Meek 1988 and Harman 1991), of the economic aspects and consequences of mergers (e.g. Fielden 1991), of the politics of merger negotiations (Scott 1988; and Rechter and Scott 1988), and of the effects of mergers on academic staff and academic programmes (e.g. Cannon 1977; Maling 1988). In terms of theoretical studies, the literature is still very slight, except for an important recent doctoral study by Goedegebuure (1992) at the University of Twente.

Despite the very large numbers of mergers that have been achieved in Australian higher education since the mid-1970s, the network UNE will be the first clear-cut case of a break-up of a merged institution. The only case that resembles it is that in Melbourne when in 1991 the Royal Melbourne Institute of Technology (RMIT) withdrew from the amalgamated Victoria University of Technology. However, in this case RMIT withdrew almost at the end of a six month ‘trial marriage’ period agreed to in formal merger documents.

This paper is a story told by an insider. I took up a chair in educational administration in the pre-amalgamated University of New England in 1985, some four and a half years prior to the July 1989 amalgamation. As

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122 Higher Education Quarterly

Deputy Chairman of the University’s Academic Board, I was actively involved during 1988 and 1989 in the discussions and negotiations which led to the merger. I supported merger of the two higher institutions in Armidale, and also merger of the two institutions in Armidale with the CAEs at Lismore and Orange. From February 1990 until November 1992, I held the position of Chair of the Academic Senate of the network UNE. I regret that the experiment failed, but in this paper I will try to take as detached a view as possible under the circumstances.

In the paper, I use the terms merger and amalgamation interchangeably. A merger or amalgamation has been usefully defined by Goedegebuure (1992, p. 16) as

. . . the combination of two or more separate institutions into a single new organizational entity, in which control rests with a single governing body and a single chief executive . . . , and whereby all assets, liabilities, and respons- ibilities of the former institutions are transferred to the single new institution.

A merger may take many different forms from a loose affiliation at one end of the continuum to a tightly integrated institution at the other. A federation along the lines of the network UNE could be placed somewhere about the middle.

How the UNE merger came about

The UNE merger was an integral part of dramatic restructuring of Australian higher education that took place between mid-1987 and about 1991. Prior to 1987, Australian higher education had gone through a period of rapid growth in student enrolments until 1975, and then a period of much reduced growth and consolidation to about 1983 prior to another period of expansion. In the decade prior to 1987, the Australian higher education system consisted of two distinct sectors - nineteen traditional British style, universities, and about 50 CAEs, somewhat like both British polytechnics and American state colleges of that period. These two sectors together with a separate sector of technical and further education made up the tertiary or post-school education system.

In July 1987, immediately following the return to office in a general election of the Labor Government led by Mr Bob Hawke, Mr John Dawkins became Minister in charge of a new consolidated portfolio of employment, education and training and immediately set to work to make fundamental reforms in the higher education, technical and further education and schools sectors, and in vocational training (Harman 1989).



As far as our story is concerned, the key changes in higher education included:

0 Abolition of the binary system with separate university and CAE sectors and replacement by a Unified National System (UNS) of higher education;

0 Forced institutional mergers to reduce the number of separate higher education institutions and to develop larger and more comprehensive institutions;

0 Allocation of additional funds to facilitate major growth in student enrolments;

0 Reform of university governance, giving greater power to Vice- Chancellors; and

0 Increased funding for research and application of a policy of greater concentration and selectivity in research funding.

Abolition of the binary system made the prospect of merger of nearby universities and CAEs much easier since universities and CAEs would from then on belong to a single sector higher education and be funded on the same basis in broad terms. Previously cross-sectoral mergers had proved extremely difficult to achieve, even when a university and CAE were located on adjoining sites.

The Dawkins policy of extensive institutional amalgamations was implemented through a cleverly devised administrative strategy. All institutions were required to make formal application to join the UNS and so to qualify for continued federal funding. It is important to note that since 1973 all higher education institutions had been funded by the Commonwealth Government. Three levels of membership were established for the UNS, each with its benchmarks as follows:

0 2000 equivalent full-time student units (EFTSUs) to become a member of the UNS.

0 5000 EFTSU for an institution to have a broad teaching profile with funding for some research activity.

0 8000 EFTSU for a rektively comprehensive involvement in teaching and with the resources to undertake research across a significant proportion of its profile. (Higher Education: A policy discussion paper 1987, p. 34)

Even the largest universities took the benchmarks seriously and so it was not surprising that this strategy had a major influence on the thinking of the four institutions which later combined to form the network UNE.

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With only 5685 EFTSU in 1987, the UNE realized that on its own it would not qualify as a comprehensive research university. Armidale CAE with 1370 EFTSU and Orange Agricultural College with 378 EFTSU were clearly well under 2000 EFTSU and so had no prospects of joining the UNS as independent institutions. Northern Rivers CAE was just under the 2000 EFTSU limit with 1745 EFTSU, but thought that its future could be doubtful.

Curiously even non-Labor governments at state level put up little resistance to the Commonwealth Government’s policy of forced amalgamations. This was important as in Australia almost all higher education institutions are public institutions, set up under state (rather than federal) legislation and responsible to a state minister and parliament. As a result of this, amalgamation of higher education institutions in the states requires approval of the relevant state government and parliament. In 1988-1989 one of the most co-operative state governments with respect to the Commonwealth Government policy of forced amalgamations was the Liberal-National Party Coalition Government in New South Wales, then led by Mr Nick Greiner. Its Minister for Education at the time, Dr Terry Metherell, publicly supported the federal policy on amalgamations and in early 1989 over a period of about four months pushed through a series of amalgamations which provided for all CAEs in the state except one to be incorporated in existing universities, or combined to form new universities. In the end, the single CAE which wished to remain on its own, the Macarthur Institute of Higher Education, agreed to a merger. As a result of this effort, plus a slightly earlier combination of two CAEs in the western Sydney area to form the University of Western Sydney, the New South Wales higher education system was transformed from a system of seven universities and fifteen CAEs to one of just nine universities. Three of the ‘new’ universities (Western Sydney, UNE, and Charles Sturt) were set up under very similar legislation as network multicampus universities.

Increased demand for student places and the Commonwealth Govern- ment’s decision to allocate substantial additional funds to support growth provided a new opportunity for institutions which wished to grow. All four institutions which combined to form the network UNE were keen to achieve growth and following amalgamation the various campuses put a great deal of effort into trying to attract as much additional ‘funded load’ as possible. Such lozd after July 1989 was allocated in block to the network UNE, and so inevitably disputes soon emerged on how additional load should be allocated between campuses. Since it was located in a region of rapid growth, the UNE-Northern Rivers campus argued that it should receive the bulk of new funded load.

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The four former institutions which came together to form the network UNE were not only from different sectors of higher education, but were very different in size and character. This is one reason why the task of merger was not easy. The University of New England began in 1938 as a small University College related to the University of Sydney. In February 1954 it became an autonomous university and the following year began to offer courses by distance education as well as to internal students. At amalgamation in 1989 it had a total enrolment of 9681 students (6253 EFTSU) studying in six faculties - arts, science, education, economic studies, rural science and resource management. About two thirds of the students were studying externally (i.e. by distance education) and this made UNE the largest distance provider in the Australian higher education sector. At the time, UNE could be characterized as a middle- sized university, with a relatively limited educational profile in terms of range of disciplines, and with fairly conservative and traditional academic values.

The Armidale CAE had been founded as Armidale Teachers College in 1928. After it became a CAE in the early 1970s, it attempted strenuously to expand its size and range of disciplines, but effectively it was able only to expand into nursing, multicultural and aboriginal studies, and some related social science disciplines. In 1989 it had a total enrolment of 2072 students, with a student load of 1449 EFTSU. Armidale CAE could be characterized as a fairly conservative and academically undistinguished institution, but one with a good record in serving its client professions.

From the early 1970s, various attempts had been made both by state and federal governments and the two higher education institutions in Armidale themselves to achieve an amalgamation. But in each case, these efforts were unsuccessful. In the late 1980s, while a proportion of staff at both institutions thought that in the long-run merger was probably inevitable, many people accepted that merger would be difficult, especially because of the different missions and orientations of the two institutions .

The Northern Rivers CAE was established in the late 1960s as Lismore Teachers College. It became a CAE in the early 1970s, but its expansion was slow and halting until the appointment of Dr E. R. Treyvaud as Principal in the mid-1980s. In 1989 it had a total enrolment of 2604 students (2296 EFTSU) and had expanded its own programs from its original base in education into nursing, applied science, business studies, and the visual and performing arts. As Principal, Dr Treyvaud transformed the College into a innovative and entrepreneurial institution, keen to grow and make its mark.



Orange Agricultural College was established in the early 1970s and for some years was controlled directly by the New South Wales Department of Agriculture. Even after it became a CAE, its growth rate was slow. In 1989 it had a total of 769 students (438 EFTSU), enrolled in farm management and livestock management courses, mainly at associate diploma level. Its main strength was its close and supportive relationship with government agricultural agencies and agricultural interest groups in the state.

Amalgamation of the two institutions in Armidale and the Northern Rivers CAE, in a strict sense, was initiated voluntarily, but in the context of strong pressure from federal and state governments, and then locked into place by legislation enacted by the New South Wales Parliament. The UNE, on the advice of its then very new Vice-Chancellor, Professor Don McNicol, who took up duty early in 1988, decided not to initiate amalgamation discussions with other institutions, but to respond favourably to any requests from nearby CAEs. Both the Armidale CAE and Northern Rivers CAE made formal approaches to the UNE. The Armidale CAE, however indicated that it was interested in merger only if Northern Rivers CAE was included; presumably it was concerned about the past record of failure to achieve merger in Armidale, and thought that it would simply be absorbed if it alone amalgamated with the UNE. The UNE responded favourably to the requests from the two CAEs and negotiations began.

The UNE was not only concerned about its need to achieve the 8,000 EFTSU benchmark if it was to remain a ‘comprehensive research and teaching institution’, but had other reasons for pursuing amalgamation. Its Vice-Chancellor and small group of senior staff, including myself, were convinced that amalgamation of the two institutions in Armidale was essential. We were aware that Commonwealth Government officials strongly favoured amalgamation in Armidale, and that the two institutions were unlikely to attract major capital funds for new buildings while they remained separate. We also were concerned about the longer term viability of the University and favoured growth if possible in student enrolments. Since the northern tablelands and north west region of the state in which the University was located had a static population, it was unlikely that the UNE would be allocated any substantial new funded load. We hoped that amalgamation with Northern Rivers CAE would help UNE attract students from the north coast region, whose population was rapidly growing, and we anticipated that an amalgamated institution including Northern Rivers CAE would be allocated substantial new funded load. Significantly, at the beginning of 1989, the Commonwealth Department of

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Employment, Education and Training provided funding to enable the UNE to begin teaching degree courses at Coffs Harbour, on the north coast some 200 kilometres east of Armidale and about 200 kilometres south of Lismore. This was understood to be a ‘reward’ to the UNE for enthusiastically responding to the requests from the nearby CAEs for merger negotiations.

The three CAEs had other motives, apart from pressures for survival. Armidale CAE presumably recognized that amalgamation in the long-run was inevitable, and saw the situation in 1988 as an opportunity to try to create a new university in which it would not be simply absorbed by the UNE. It assumed that Northern Rivers CAE would prove a useful ally in merger negotiations. Northern Rivers CAE was attracted to acquiring immediate university status by amalgamation with an established university. Orange Agricultural College entered into negotiation with the other three institutions only in May 1989, since it was strongly opposed to becoming part of Charles Sturt University to be formed through amalgamation of Mitchell College of Advanced Education at Bathurst and Riverina-Murray Institute of Higher Education, which had campuses at Wagga Wagga and Albury. It seized the opportunity to escape from what it saw would be an unfortunate ‘marriage’ in which it would lose its identity as a separate institution. It also was attracted to combination with the UNE because both institutions had shared academic interests in agricultural education and at the time it was rumoured that nationally post-school agricultural education was likely to be rationalized, with some providers being forced to close down their courses.

The merger negotiations between the UNE, the Armidale CAE and the Northern Rivers CAE proceeded for some months and on 10th August 1988 the chief executives and registrars of the three institutions signed a formal agreement to work to achieve merger. This document stated that merger

would be to the mutual advantage of their respective institutions and the wider communities they serve in that it would ensure that the consolidated university is part of the unified national system of higher education as an institution with ‘relatively comprehensive involvement in teaching and with resources to undertake research across a significant proportion of its profile’; ensure national recognition as a major provider of external studies; enhance the ability to provide consultancy and other services to industry; strengthen the regional identity of higher education in northern New South Wales; increase the range of studies available to students; improve access to higher education for disadvantaged groups in the community; ensure that each area of study and discipline in the consolidated university pursues excellence in the generation of knowledge and its dissemination through teaching, research, publications,

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continuing education and non-award courses, performances and other means; strengthen and further develop professional education in various fields; and provide enhanced opportunities for the professional development of staff. (Amalgamation Implementation Committee: Towards a Report to the Councils 1989, Appendix I, p. 1).

An Amalgamation Implementation Committee of nine persons (three from each institution) was formed, with the University Vice-Chancellor, Don McNicol, as Chairman. This Committee produced two major reports, which set out detailed plans for the proposed combined institution and its future directions. However, the work of the Committee was not always smooth, and conflict often emerged, especially between the members from Northern Rivers CAE and other members. The situation was made more difficult by a flow of provocative and damaging public statements, especially those from some senior academic staff of the UNE criticising academic standards at Northern Rivers CAE, and those from senior staff of the Northern Rivers CAE criticizing the administration and financial situation of the UNE. Just prior to amalgamation, a senior administrator at Northern Rivers publicly claimed that the UNE was bankrupt, although in fact the UNE had about $40m at the time in invested funds.

One major development that affected the merger planning process was intervention by the New South Wales Minister for Education and then passage of legislation through the New South Wales Parliament (University of New England Act 1989; and Higher Education (Amalgamation Act) 1989). In March 1989, the Minister circulated for comment draft legislation providing for a number of mergers throughout the state, and about three weeks later this legislation was passed by the Parliament with only minor amendments. Significantly, the University of New England Act 1989 departed on some key points from draft legislation prepared by the local Amalgamation Implementation Committee. In particular, instead of establishing an integrated unitary institution, it provided for a ‘university network’ which was defined as ‘a federation of (a) the University of New England, Armidale; (b) the University of New England, Northern Rivers; and such as network members as may be established from time to time . . .’ (Section 6). The Act also required appointment of a Chief Executive Officer for each of the two network members (ie Armidale and Northern Rivers) and provided that each Chief Executive Officer ‘would be responsible to the Board, through the Vice-Chancellor, for the day to day management of the network member’ (Section 13(3)). These changes which, presumably, were pressed on the Minister by the Northern Rivers CAE, and curiously were not opposed by the UNE and its Vice- Chancellor, were to prove to be of major importance. Staff at Northern

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A Merger that Failed ! 29

Rivers used the legislation to press continually for a maximum degree of devolution to campuses, whereas most senior staff at Armidale continued to believe they were working to achieve a highly integrated new University.

The network UNE The network UNE came into being on 17th July 1989 with a structure that gave considerable management autonomy to each campus. In part, as already noted, this structure sprang from the new University act, but also the Northern Rivers campus pushed for as much independence as possible. As Vice-Chancellor of the new University, Don McNicol almost immediately resigned from being Principal of UNE-Armidale (as well as Vice-Chancellor) and agreed to demands from UNE-Northern Rivers to set up a ‘trans-campus’ administrative unit in Armidale, separate from the administration of UNE-Armidale. The argument of senior personnel at Northern Rivers was that the Armidale campus would dominate the network University unless the trans-campus administration was separate. Figure 1 shows the management structure adopted for the network UNE. Academic governance was a various mixture of structures. There was a single Academic Senate as the senior academic body, but UNE-Northern Rivers was allowed to retain its academic board while at Armidale the four faculties reported directly to the Senate. Joint Boards of Studies were set up to co-ordinate advice from each of the major discipline areas, but these proved ineffective.

Early in 1990 Don McNicol took up the Vice-Chancellorship of the University of Sydney and was replaced at UNE as Vice-Chancellor by Professor Robert Smith, who had served a brief term in Canberra as foundation Chairman of the new National Board for Employment, Education and Training (established by Mr Dawkins) and before that for four years had been Vice-chancellor of the University of Western Australia. Robert Smith moved to an even more devolved structure for the University. After careful study of the details of the UNE legislation, he was convinced that the University was meant to operate as a federation and I suspect that he thought that a university with campuses such vast distances apart could be best managed by using as devolved a management structure as possible.

In the months that followed the formal merger, a great deal of effort and money went into trying to make the network University work. This involved expenditure of considerable time and energy by a large number of senior academic and administrative staff, and of University finances and


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Deputy VicaChnncellor University Network

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1

&mrd of Govaaon

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Figure I : Administrative Structure of UNE Network

special government grants to assist in the achievement of amalgamation. It also meant a great deal of travel for face to face meetings, although over time increased use was made of tele-conferencing and video-conferencing . On the academic side, after prolonged negotiations, a structure for a permanent University-wide Academic Senate and committee system was agreed to, replacing an interim structure introduced in July 1989. University-wide management systems were developed and arrangements were made to handle a wide range of administrative matters. After considerable dispute, a detailed system for division of the annual recurrent budget among campuses and the Vice-Chancellor’s Unit using the Federal Government’s ‘Relative Funding Model’ was adopted by the Board of Governors. Also a decision was made by the Board on the recommendation



of the Vice-Chancellor for financial resources to be distributed to campuses and thence to faculties, whereas the original plan had been to distribute resources to Northern Rivers and Orange campuses, but directly to the four faculty budget cost centres at Armidale.

On the positive side, it is important to note that a number of significant achievements were made by the network University, benefiting particularly staff, students and potential students. These included the introduction of a large number of new degree courses and course units which was facilitated in the early stages by some sharing of experience between campuses, offering of a number of courses in the rapidly developing city of Coffs Harbour, wider opportunities for staff to be involved in both research and consultancy, and a broadening of the definition of a University within the UNS. In addition, there were important innovations and entrepreneurial efforts, including the establishment of highly innovative Professional Development Centres at the Lismore campus, development of the work of the university consulting companies (Norsearch at Lismore and University Partnerships at Armidale), expansion of full-fees overseas student enrolments at Armidale, contracts with outside bodies for the provision of tailor-made degree and diploma credit courses, and the establishment of a series of open learning access centres along the north coast. So at least to some extent many of the aims set out in the merger agreement were achieved.

However, the merger certainly failed from the viewpoint of securing effective, long-term co-operation in teaching and research between campuses, in establishing harmonious relationships, and in working to secure the network University’s long-term future. Even before the official merger date, relationships between the Armidale and Lismore campuses soured, largely as a result of public attacks by staff of one campus on the other. Once merger arrived, open conflict soon occurred within the institution on many issues, such as on awarding University titles to senior former CAE staff, on proposals from Northern Rivers for the immediate introduction of honours and higher degree courses, on new rules for promotion of academic staff, and on the allocation of research funding and new student load between campuses. Despite the provision for Joint Boards of Studies in the academic governance structure in order to secure co-operation in academic planning between campuses in each major discipline, it proved impossible to develop any University-wide degrees and diplomas, and each campus insisted on having its own campus specific awards.

In early 1992 the situation deteriorated further and on 1st May 1992 the governing body, the Board of Governors, resolved to request the New



South Wales Minister of Education and Youth Affairs to replace the network University of New England with two separate universities, one based on Armidale and the other on Lismore. A detailed submission was prepared to accompany this request. Following discussions between the New South Wales Minister of Education and the Commonwealth Minister for Higher Education, on 15th May 1992 the two Ministers jointly established a high level, independent Advisory Group headed by the former Vice-Chancellor of the University of New South Wales, Professor Michael Birt, ‘to consider the implications of a submission from the Board of Governors of the University of New England to restructure the existing University network’. This Group was asked specifically to report ‘on the education needs of the northern regions of New South Wales and to advise on the effect the proposed changes may have on access to, and delivery of, quality higher education at each of the campuses of the existing UNE network’ (Report of Joint Ministerial Advisory Group 1992, p. 2).

The Advisory Group carried out its work quickly and efficiently, visiting each campus and locality for discussions with senior University management, University staff and community groups. It reported to the Ministers in early October 1992, making a number of recommendations.

(a) A new university should be established on the North Coast region of New South Wales as an integrated institution incorporating the current UNE campuses at Northern Rivers and Coffs Harbour.

(b) For a period of three years from the date of its establishment this new university should be formally affiliated with and develop under the sponsorship of a major metropolitan university (most likely the University of Sydney).

(c) Orange Agricultural College should negotiate with the University of Sydney a form of institutional affiliation acceptable to both institutions and to the New South Wales and Commonwealth governments, with a view to implementation not later than July 1993.

(d) A Planning Vice-chancellor should be appointed to the new university with authority to negotiate all matters relating to its development until enabling legislation is passed or the inaugural Vice- Chancellor is appointed.

(e) UNE-Armidale (incorporating Armidale CAE) should be reconstituted as an autonomous university (Report of the Joint Ministerial Advisory Committee 1992, p. 1).

The two Ministers soon after accepted the recommendations and more



recently have agreed that the network UNE will break into two universities no later than 1st January 1994.

Why the merger failed

To explain any major turning point in the life of a complex organization is difficult, especially if it is associated with conflict and strongly held views. It is even more difficult for those intimately involved in the task to make sense of such turning points, and especially if they continue as members of the organization. Despite these difficulties, in this section I will try to offer an explanation for the break-up of the amalgamated UNE. I will first consider explanations offered by members of the University for conflict and the break-up and by the Birt panel, and then offer a personal perspective.

In a report to the March 1992 meeting of the Board of Governors, the Vice-Chancellor identified five major sources of tension in the University:

0 A fundamental misunderstanding of the nature of amalgamation, particularly at Armidale. (Northern Rivers saw the merger as formation of a federation, while Armidale saw it as an amalgamation implying ‘a clear commitment to the pursuit of unitary policies’)

0 An imperfect appreciation of the implications of the legislation (‘by establishing a network, the legislation provided for de facto devolution of authority’)

0 A deliberate shift in governance processes and structures in mid-1991 to a more devolved structure in order to address tensions

0 The academic governance processes and structures put in place in 1990 prove to be less than satisfactory

0 The legislative framework is defective (with provision for Advisory Councils which have become advocacy and support groups for their particular campus, and with heads of the main campuses as full members of the Board of Governors) (University of New England: Vice- Chancellor‘s Consolidated Response on Amalgamation Issues, 1992)

Other University documents identified additional factors, such as the differences in culture between the Armidale and Lismore campuses, sensitivities over academic status issues, difficulties of distance and communications between campuses because of the vast distances involved, and disputes over the allocation of financial resources and new funded student load. The Principal of the Northern Rivers campus, Professor



Rod Treyvaud, claimed publicly that resources and not philosophy was the real issue in the disamalgamation debate. According to Treyvaud,

We [ie the Northern Rivers campus] have had to protest at the lower level of funding provided for its students in comparison to other members of the network University.

Similarly Northern Rivers could not accept the diversion on tenuous premises of almost all research funds going to Armidale. (Armidale Express, 20th May 1992)

Another major concern, according to Treyvaud, was the transfer of additional student places ‘earmarked’ for the north coast to campuses at Armidale and Orange.

The Advisory Group chaired by Professor Birt addressed the issues of the benefits achieved by the network University and the factors which led to the University’s request for disamalgamation. It identified a considerably long list of achievements, and commented that ‘it found it disappointing not only for the University but for higher education generally that unrealized opportunities have left much valuable development work unfinished’ (Report of Joint Ministerial Advisory Group 1992, p. 8) . It said that a range of factors contributed to the problems of UNE, but that the following were particularly important:

(a) Differences in expectations of the legislation that created the network arrangement

(b) Complexity of structures of governance established by the legislative framework

(c) Problems associated with institutional funding and (d) Logistical difficulties caused by distance and transport problems

(Report of the Joint Ministerial Advisoty Group 1992, p. 8)

On the first point, the Advisory Group commented of crucial importance was that the Armidale and Northern Rivers campuses took fundamentally different views of how their relationship would evolve under the University’s legislation. It explained:

The predominant view at Armidale was that the former University of New England would, as an established university in its own right, have senior status in the new institution with respect to matters of academic planning and development, and that the new institution should function as an integrated unit with complementary provision of courses at each campus.

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The view at Northern Rivers, however, was that the two network members specified in the Act (UNE-Armidale and UNE-Northern Rivers) should have equal status in all matters of institutional governance and academic operations, and that the institution should function as a loose federation of largely independent campus members (Report of the Joint Ministerial Advisoy Group 1992, p. 8).

On the matter of the complexity of the governance structures, the Advisory Group pointed to ambiguities in the legislation with respect to the positions of Vice-Chancellor and campus principals (who were given chief executive officer status). It also drew attention to the problems arising from making campus principals members of the governing body, on an equal footing with the Vice-Chancellor. On institutional funding, it was critical of the University’s rapid move to an open and non- discriminating formula funding approach, and adoption of the Common- wealth Government’s Relative Funding Model for internal allocations. It commented that this had a three-fold effect:

0 It forced redistribution of student funding throughout the University at a faster rate than the Commonwealth had accepted for adjusting institutional relativities across the system as a whole.

0 It attempted to provide recurrent research funding to all network members without regard to the record of performance.

0 It did not make adequate provision for discretionary adjustment to deal with existing staff commitments and institutional planning priorities as distinct from individual campus demands. (Report of theJoint Ministerial Advisory Group 1992, p. 10).

With respect to problems of distance and transport, the Advisory Group commented that while ‘individually these difficulties may not seem insurmountable, their cumulative effect has been to impede the process of institutional collaboration to the point where the development and maintenance of joint activities is generally unproductive’ (Report of the Joint Ministerial Advisory Committee 1990, p. 11).

In summary then, participants and observers have identified a large number of different factors that have generated conflict and have led to disamalgamation. Two important questions need to be asked: First, of these various factors identified, which ones were of greatest significance in the generation of conflict and break up of the University? Second, were there other factors which, perhaps because of sensitivities, were not mentioned by participants or by the Birt Panel?

After considerable reflection in the events of the past five years or so, I



believe that the conflict generated and the almost certain break-up of the UNE network can be attributed essentially to three key factors. First, the former UNE and the former Northern Rivers CAE proved to be unsuitable partners, who lacked a strong commitment to the maintenance of a single amalgamated university. As already noted, not only were these two institutions from different sectors of higher education, each of which had a distinctive culture and set of values, but the two institutions also had very different orientations and traditions. The former UNE essentially was a very conservative, traditional British-style university, academically organized in departments mainly on disciplinary lines and its academic staff having relatively little contact with the world of business and most of the major professions. It was very concerned about academic standards, and how its work was regarded by major city institutions, such as the University of Sydney, and leading overseas institutions. Regarding itself as a ‘proper’ university with half a century of history behind it, the UNE expected to be recognized as the senior partner in any amalgamated institution, and for it to be undoubtedly the guardian of academic standards. Northern Rivers CAE was a relatively new institution, and pushy, brash and entrepreneurial. It was academically organized in schools related to professional areas rather than in disciplines, and most of its courses had a strong applied and vocational emphasis. It had been very successful in establishing close contacts with business, a number of professions and major employers. It had very little academic work in the basic or non-applied humanities, social sciences and physical and biological sciences. In the amalgamated institution, Northern Rivers proved unwilling to recognize the former UNE in any sense as a senior partner, and demanded all the trimmings of a University immediately - honours bachelors degrees, research masters degrees, the Ph.D, infrastructure funding for research, and professorial titles for senior staff. It demanded equal status to UNE-Armidale and was not prepared to recognize the old UNE element at Armidale as the guardians of academic standards. Understandably these differences between the two campuses and the demands of UNE-Northern Rivers resulted in major conflict.

But apart from this, of vital importance was the lack of deep commitment to the idea of amalgamation, while a number of the basic motivations for the former UNE and the former Northern Rivers CAE combining soon lessened in importance or evaporated completely. To a large extent, the staff of the former UNE accepted the need for amalgamation on the basis that the UNE fell short of the benchmark of 8000 EFTSU for a comprehensive research university. But soon it became obvious that combination of the former UNE and the former Armidale



CAE alone would have been sufficient to exceed the 8000 EFTSU benchmark. It also became clear that the Commonwealth Government was not going to enforce the EFTSU benchmarks as strictly as expected. Further, senior management at the former UNE failed to communicate effectively to staff why inclusion of Northern Rivers CAE in the amalgamation seemed advisable from a longer-term strategic perspective. Northern Rivers CAE, on the other hand, soon achieved its key objectives for merger in that it acquired university status and many of the trimmings of a proper university. Further, by about 1991, the possibility of the Northern Rivers campus becoming a separate university began to appear a distinct possibility once a number of institutions with far less than 8000 EFTSU were allowed to become separate universities within the UNS.

A second factor that contributed to major degree to conflict and eventually to break-up was structural: a devolved structure not only did not suit an institution where key partners lacked a strong commitment to stay together, but devolution enabled the Armidale and Northern Rivers campuses to push for greater devolution and independence and to mount a strong public campaign for dissolution of the University. As already noted, the network University was originally planned to be a unitary organization, with staff from different campuses working together on teaching programmes, and especially combining expertise in offering degree and diploma programmes by distance education. Many of the senior staff of the former UNE argued strongly for cross-campus faculties. In response to pressures from Northern Rivers CAE, some concessions were soon made in early negotiations, and following the passage of the legislation which provided for a federated network structure Northern Rivers gained further concessions. It thus went into amalgamation with the proposal for cross-campus faculties having being defeated, with Northern Rivers having been recognized as a separate budget cost centre, and having its own campus academic board and advisory council. In the end, at both Armidale and Northern Rivers campuses, academic boards and advisory councils played key roles in the push for disamalgamation.

The distinct possibility of disintegration of newly amalgamated universities has been recognized in a number of cases in recent Australian amalgamated universities. Two universities in particular, Charles Sturt and Tasmania, have deliberately adopted highly integrated management and academic organization models, with campuses not being separate budget cost centres, and with faculties being cross campus, in order to try to stop tendencies towards disintegration. To date these two institutions have been reasonably successful in dealing with disamalgamation tendencies, and certainly they lack university structures to facilitate a push for



disamalgamation by staff. At Charles Sturt University, staff at one campus, lacking a local campus academic board or advisory council, have used their local academic staff association as a vehicle to push for disamalgamation, but this has proved relatively ineffective.

Third, in the escalation of conflict and the move towards break-up, personalities played a major part. This is not the time to elaborate on this point, except to say that a number of senior staff from both the Armidale and Northern Rivers campuses found it difficult to work together, that in some cases conflict appeared to be provoked by particular deliberate actions taken, and that a small number of senior staff played a key role in publicizing the case for disamalgation. Also important was a lack for continuity in Vice-Chancellors. In early 1988, just prior to amalgamation discussions commencing, Professor Lawrie Nichol moved from the former UNE to become Vice-Chancellor of the Australian National University and was replaced as Vice-Chancellor by Don McNicol who two years later moved to be come Vice-Chancellor of the University of Sydney. He in turn was replaced by Robert Smith. All three proved to be leaders of exceptional energy and dedication, but the breaks in continuity had various effects, especially in terms of thinking on strategy and various matters of policy.

One notable feature of both the amalgamation negotiations and the events that led to the decision on disamalgamation break-up of the network University was that the key actors were almost exclusively from the former UNE and the former Northern Rivers CAE. Senior staff from the Armidale CAE played a constructive role in the merger negotiations, while the negotiations which resulted in Orange Agricultural College joining the network proceeded smoothly and quickly. In the events leading to the decision on the decision on the break-up of the University, former Armidale CAE senior staff did not play a major role, while senior staff at Orange strongly supported continuation of the network University until the Ministers made their decision.

Summary and final comment

In 1989-90, the former UNE combined with three colleges of advanced education in northern New South Wales to form the network UNE. Although it was a voluntary amalgamation, the four institutions were pressured to combine by both federal and state governments. Unfortun- ately the negotiations prior to merger and the experience of the network UNE were marred by conflict and federal and state Ministers responsible for higher education have agreed that the network UNE will be divided



into two separate universities by no later than 1st January 1994. Participants and observers have identfied many different factors that have contributed to the conflict and break-up, but three factors were of particular importance. These were that the former UNE and the former Northern Rivers CAE proved to be unsuitable partners who lacked a strong commitment to maintenance of a single amalgamated university, the devolved structure adopted not only proved unsuitable for campuses not strongly committed to maintenance of an amalgamated university but provided Armidale and Northern Rvers campuses with convenient local structures to use in the push for disamalgamation, and personalities played an important role.

In a strict sense the amalgamation has failed in that the combined institution is to split into two separate universities. But at the same time there have been many positive achievements especially in terms of the range of courses available in northern part of New South Wales. Further, disamalgamation will not mean going back to pre-July 1989 structures, since a combined institution in Armidale will remain and the campuses at Lismore and Coffs Harbour on the north coast will be part of the new multicampus university to be created, centred on Lismore. One important effect of conflict between the former UNE and the former Northern Rivers CAE prior to merger was that the proposal for merger of the two institutions in Armidale received very little attention or comment in 1988-89. Yet over the previous two decades, as already noted, various serious attempts at merger of the two institutions had failed, and merger negotiations had run into great difficulties about trying to combine institutions with different missions and cultures.

What impact dlsamalgamation of the UNE network will have on the Australian higher education system is difficult to predict. Certainly, the problems in the network UNE have attracted a great deal of media attention and comment, and in a number of recently amalgamated universities there has been some discussion of the possibilities of disamalgamation. While the policy of the Commonwealth Government on amalgamations and the bench-marks necessary for membership of the UNS has been very considerably eased since about 1991, Commonwealth officials are likely to do everything possible to hold other amalgamated institutions together. It is also unlikely that the two successor universities to the network UNE will gain any special concessions or help from the Department of Employment, Education and Training which could be interpreted as rewards for disamalgamation.

0 Basil Blackwell Ltd. 1993


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a merger that failed: the case of the university of new england

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