THE ANU will cut costs in staffing and business practices, in what the university has described as a “bold action” to save $40million.

ANU vice-chancellor Prof Ian Young said the university’s investment returns had been on the decline, with this year’s  investment income expected to be about $30 million less than previous years

“I understand that change of this magnitude causes stress and upset for all, and we do not undertake this process lightly,” he said.

“Our aim is to identify the best way to make these savings and ensure ANU can continue to live up to the expectations of our staff, students and the national and international communities we live in.”

The ANU released a draft discussion paper yesterday that proposed the $40million be reached by saving up to $25 million in staff expenses and up to $15 million in improved business practices.

Prof Young said the university had reached a point “which there is no option but to take bold action”.

“If we do not act to reduce spending, the University will be unable to invest in excellence, and will suffer a gradual decline in international standing and quality,” he said.

“That is not a future that any member of the ANU community wants.”

Prof Young said ANU was not alone in having global and national financial circumstances cut into its bottom line.

“The 2012 budget has a projected surplus of only $14 million, or less than 1.5 per cent of total revenue,” he said.

“The sector average is 4 per cent, a figure which the Commonwealth monitors as a measure of financial health.”

The draft report can be found at here.