The Turnaround Story: Victorian Universities Rebound Strongly
Victorian universities have staged an impressive financial recovery in recent years, transitioning from pandemic-era deficits to collective surpluses and revenue growth exceeding A$1 billion across the sector. This resurgence is particularly evident in the standout performances of Royal Melbourne Institute of Technology (RMIT) and Victoria University (VU), both reporting robust surpluses alongside record enrolments. The shift marks a pivotal moment for Australia's higher education landscape, where strategic enrolment growth, cost discipline, and diversified revenue streams have restored stability amid ongoing challenges like inflationary pressures and policy changes.
The eight public universities in Victoria—University of Melbourne, Monash University, RMIT, Deakin University, La Trobe University, Swinburne University of Technology, VU, and Federation University—collectively navigated turbulent times. Post-COVID, many faced deficits totalling hundreds of millions, driven by border closures slashing international student numbers. By 2025, however, the picture brightened significantly, with total revenue climbing due to rebounding international fees, domestic demand, and prudent management. RMIT and VU exemplify this trend, their successes underscoring the potential for targeted strategies to drive profitability in higher education.
This turnaround not only bolsters institutional balance sheets but also enhances capacity for research investment, infrastructure upgrades, and student support, positioning Victoria as a leader in Australian higher education recovery.
VU's Record Enrolments Fuel Major Surplus
Victoria University stands out with its 2025 annual report revealing unprecedented student numbers: 52,656 total enrolments, a 27 per cent cumulative rise since the launch of its 2022–2030 Strategic Plan. This includes 39,571 higher education students and 13,085 in vocational education and training (VET), with 40.6 per cent from equity backgrounds and 41.3 per cent first-in-family attendees.
Financially, VU posted a total surplus of A$117.4 million, with an underlying operating result of A$35.6 million after excluding non-recurring and non-cash items. This builds on 2024's A$66.1 million surplus—a stark A$84.2 million turnaround from the prior A$18.1 million deficit. Revenue grew 13 per cent to A$699 million, propelled by enrolment surges in high-demand areas like Early Childhood Education (from 600 in 2020 to 4,000 in 2024) and international students numbering 13,589 on Melbourne campuses.
VU's Block Model®—delivering subjects in intensive, focused blocks—has been instrumental, boosting student satisfaction (second in Victoria per QILT Survey) and completion rates. Partnerships with Mercy Health and the Royal Flying Doctor Service further exemplify mission-aligned growth, enabling investments in paramedicine excellence and youth mental health hubs.
RMIT's Path to Sustained Profitability
RMIT University has solidified its recovery, achieving an after-tax operating surplus of A$89 million in 2025 on revenue of A$1.955 billion (up 8 per cent from 2024). Expenditure rose 5 per cent to A$1.857 billion, reflecting controlled cost growth amid inflation. Globally, enrolments exceeded 104,000 students, with strong demand in Australia and Vietnam campuses.
This follows a A$32.3 million surplus in 2024 and marks a shift from 2023's A$58.7 million pre-tax deficit. Key drivers include diversified revenue—course fees up significantly—and resilience in RMIT Vietnam, which delivered surpluses despite offshore enrolment dips. RMIT forecasts continued underlying surpluses into 2026, emphasising stability for strategic investments in infrastructure and digital capabilities.
The university's focus on employability and industry partnerships has sustained domestic and international appeal, positioning it for long-term growth.
Monash and Deakin: Powerhouses of Sector Growth
Monash University led with an underlying operating surplus of A$309 million in 2025, up dramatically from A$48 million in 2024, on group turnover of A$4.293 billion (10 per cent increase). Investment earnings and international revenue were pivotal.
Deakin University reported a A$56.5 million net result on A$1.573 billion revenue (up 10 per cent), with onshore international earnings rising 14 per cent to A$353 million. Despite anticipating a 2026 deficit, these results highlight effective revenue diversification.
Both institutions exemplify how research-intensive universities leverage global rankings and partnerships to weather enrolment caps.
Photo by Eriksson Luo on Unsplash
Persistent Pressures: Melbourne and Smaller Players
Not all fared equally. The University of Melbourne recorded a A$124 million operating loss—its fourth consecutive—on A$3.307 billion revenue, though headline surplus before one-offs was A$22 million. International fees rose A$80 million to A$1.482 billion (40 per cent of income), but staff costs (59 per cent of expenses) climbed due to enterprise bargaining agreements.
Swinburne saw revenue dip to A$942 million, with international onshore down A$35 million; Federation posted a A$32 million loss. These underscore vulnerabilities in smaller or regional institutions reliant on volatile international markets.
FutureCampus analysis details these variances, highlighting sector-wide staff cost rises.Key Drivers Behind the Recovery
The A$1 billion earnings boost stems from multiple factors:
- International Student Rebound: Onshore fees recovered post-borders, comprising 30-40 per cent of revenue for many.
- Domestic Enrolment Growth: VU's 27 per cent rise; RMIT's stable demand.
- Revenue Diversification: Partnerships, VET expansion, online offerings like RMIT Online.
- Cost Management: VU's disciplined approach; targeted efficiencies.
Government support via grants and indexation aided, though new caps pose risks.
Strategic Innovations Fueling Success
RMIT and VU pioneered models like VU Block Model® and RMIT's global campuses, enhancing accessibility. Monash's investment portfolio buffered volatility. These innovations—coupled with equity focus (VU's 40 per cent equity students)—not only drove enrolments but improved outcomes, with VU ranking sixth globally in Sports Science.
Research investments yielded ShanghaiRankings accolades, attracting funding.
Implications for Stakeholders
Students: Enhanced facilities, mental health support (VU headspace), better experiences. Staff: Despite cost pressures, surpluses enable wage rises via agreements. Economy: Universities contribute billions via jobs, research; Victorian public unis' impact includes A$802 million capital spend.
University of Melbourne's economic impact study quantifies this.
Navigating Future Challenges
Ahead: Commonwealth international caps, RBA rate impacts, AI disruptions. Yet, forecasts for RMIT/VU surpluses signal resilience. Sector leaders advocate policy stability for sustained growth.
Opportunities in a Thriving Sector
The turnaround opens doors for academics, researchers. With record enrolments, demand rises for faculty in high-growth fields. Victoria's universities offer stable platforms for careers in teaching, research, administration.