University of Hawaii at Manoa Chancellor Tom Apple said Friday that his plan to freeze new hires for the next two years aims to help the campus balance its budget and avoid tuition hikes.

But critics maintain Apple’s plan fails to address the cause of the budget shortfall and its possible negative impact on students.

Robert Cooney, vice chairman of the UH-Manoa Faculty Senate, said the campus spends too much student tuition money on athletics, the medical school and the Cancer Center.

"More money should go back to students," he said. "If the underlying problem that caused this isn’t getting solved, it’s just going to get worse."

Cooney said the hiring freeze may also reduce available class sections, making it harder to get into courses.

Apple, who introduced his plan in a memo to deans and directors Wednesday, said he hopes the plan will save $10 million — about 2.5 percent of the budget — for each of the next two years.

He said the plan was prompted by overspending at UH-Manoa, even after the Legislature cut funding by 25 percent to 30 percent in 2009. To cover the shortfall, Apple said, the campus has been drawing about $20 million a year from a reserve that had hundreds of millions in it at one time but now has about $90 million.

UH-Manoa’s reserve should contain one to two months of the campus’ annual operating budget, which is about $30 million to $70 million, according to UH Board of Regents guidelines.

"Now’s the time to really get budget stability," Apple said.

Besides balancing the budget, Apple’s plan attempts to increase the focus on students by including performance-based rewards to colleges. Apple said under his plan, 3 percent of each college’s budget will go into a fund to be redistributed according to hours taught and degrees granted.

"I want resources put where we teach and where we graduate students," Apple said. "We’re not going to reward a dean that overspends his budget and is not doing a lot of teaching."

Apple said the change will help the campus become "student-centric."

"We’ve never really done this kind of budgeting at the university before," he said.

Apple said he will focus on four additional areas to balance the budget:increasing student enrollment, cutting utility costs, getting researchers to include their salaries in their grants and eliminating low-enrollment programs.

Apple said UH is the only university he has worked at where researchers get paid by the Legislature rather than through grants.

He said the researchers will still get paid if they don’t include their salary in the grants, but the school is struggling to pay researcher salaries after the legislative cuts.

"We’re a research university," he said,"but we’ve got to be focused on our students and making sure that their tuition is used to the best effort."

As for the hiring freeze, Apple said the university has an 11-to-1 student-faculty ratio, better than the country’s best public higher-education institutions.

"We are a faculty-rich environment," he said. "We can afford to not hire faculty this year and perhaps next year."

He said every year about 50 to 70 faculty are hired. The campus has about 1,500 faculty members.