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Universities are budgeting to lose millions from their investment portfolios this year as the global credit crisis hits the halls of academia.
Property and equity investments account for a small proportion of universities' total income, and returns are projected to drop by about half this year.
But with back-up funds as a buffer, they say the funding shortfall should not impact greatly on students, who return for semester-one lectures in the next two weeks.
Waikato University has budgeted to lose about half of the $3.5 million it receives from property and investment income this year.
Waikato has budgeted for a 1.6 per cent return on revenue, rather than the minimum 3 per cent return it received in previous years, due to inflation, foreign exchange movements and the university's fixed funding regime.
No specific projects have been affected but activities have been reprioritised, spokeswoman Peta Goldsworthy said.
The University of Auckland said interest accounted for less than 1 per cent of its revenue of $800 million but it expected the earnings to drop by almost 50 per cent.
"Although a drop in returns from investments will not be huge as a percentage of its total revenue, it is a significant proportion of the funds we have available to invest in new activities," said spokesman Bill Williams.
Canterbury's corporate affairs manager, John MacDonald, said the university invested in equity markets and used revenue reserves to cover lean years. These would be called on this year and possibly next, he said.
Unitec, which also expects a 50 per cent decline in revenue from investments, said the loss would be offset by savings in borrowing costs.
Auckland University of Technology has been growing its capital over the past few years to develop the campus buildings and facilities.
Spokeswoman Tiffany White said that as the developments are funded through bank loans, AUT has benefited from lowered interest rates.
