Financial Sustainability in Ontario Universities

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Financial Sustainability in Ontario Universities

• Trudy Pound-Curtis
• CAUBO Conference, Saskatoon SK
• June 14, 2004

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Current Environment in Ontario

• No Inflationary Grant Funding.
• Unfunded student spaces.
• Tuition freeze.
• Large growth in capacity due to double cohort.
• Growth to continue in GTA due to demographics.

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Current Environment in Ontario

• Increasing pressures on Quality and
  Accountability.
• No plan for growth in graduate enrolment.

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Financial Sustainability A Balancing Act

• Financial sustainability can only be achieved by

• Decreasing base expenditures
• Increasing base revenues
• Managing cost pressures

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Increasing Base Revenues

• Increase Government Grants

• Funding Formula Review to ensure Equal and Full
  Average Funding for all students.
• Lobby Government for Inflationary Grant Funding
  to ensure that Quality can be maintained.
• Work with Government to maintain/grow Capital
  Funding for New Buildings and Facilities Renewal.
• Increase in Indirect Cost of Research Funding.

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Increasing Base Revenues

• Tuition in the face of a tuition freeze?

• Regulated vs Deregulated.
• Increase Visa fees, which are not covered by the
  freeze?
• Increase offerings of Professional Development or
  Full Cost Recovery programs?
• Use the increased fee revenues to cross-subsidize
  the programs whose fees are frozen.

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Increasing Base Revenues

• Fundraising

• Undertake a comprehensive fundraising program to
  offset the increasing cost of scholarships/bursari
  es, faculty, research, etc.

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Reducing Base Expenditures

• Explore different program delivery methods i.e.
  Distance Learning.
• Adjust program array to reflect the new funding
  reality.
• Renegotiate collective agreement clauses that
  restrict course delivery methodology or that
  create other inefficiencies.
• Outsource some non-core services i.e.
  Janitorial/Maintenance, Postal, and Food
  Services.
• Utilization of Technology Ontario buys Program.
• Horizontal vs Vertical cuts.

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Managing Cost Pressures

• Normal inflationary increases.
• Compensation costs.
• Benefits and pension costs.

• Impact of poor investment returns and lower
  projected spending rates on endowments.
• Proposed elimination of mandatory retirement.

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Real Risks

• Deterioration of institutional quality.
• Deterioration of faculty complement.
• Deferred maintenance.
• Deterioration of administrative staff complement.

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Constraints

• Speed of Change in Universities.
• Gaining Consensus in a Collegial Environment.
• Creating Attitudinal Change.
• Strength of Collective Agreements.

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Summary

• In order to be sustainable, Universities must

• Get a commitment from the government on sustained
  full funding for all students.
• Negotiate Capital Funding in order to sustain and
  renew facilities.
• Reduce expenditures through changing the way that
  courses are offered and reducing the array of
  programs to reflect the funding environment.
• Renegotiate collective agreements to gain the
  flexibility required to create efficiencies
  through outsourcing or other means.

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Questions