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Opinion piece - Quebec Universities: Managing in uncertainty

The third meeting in preparation for the Higher Education Summit is just a few days away. Given that the topic of this meeting is university funding and governance, it seems important to highlight the unstable financial environment in which the universities are currently operating.

On December 4, 2012, Pierre Duchesne, Minister of Higher Education, Research, Science and Technology, told the rectors and principals of Quebec universities that they had to achieve budget cuts totalling $124.3 million by the end of the current fiscal year, i.e. April 30, 2013, less than four months from now.

It should be noted that this was the first time these budget cuts had been brought to the universities’ attention.

The current financial context illustrates how dysfunctional and particularly disruptive the government’s demand is with regard to sound university management:

• With just four months remaining until the end of the fiscal year, the winter session is already planned and all personnel, specifically lecturers and auxiliary teaching staff, have been hired. This leaves most universities with essentially no room to manoeuvre.

• Approximately 80% of a university’s operating budget covers expenses related to remuneration. Such expenses are difficult to reduce, especially in the short term, without layoffs, pay cuts or the reopening of collective agreements.

• For at least 15 years, universities in Quebec have been dealing with chronically underfunded operations, compared to other Canadian universities. Resources are managed stringently, in order to ensure services comparable in quality to those provided by universities with more funds.

These cutbacks are dramatic. They are bound to have an impact on the universities’ ability to fulfil their mission with regard to teaching, research and creation, and services to the community. The universities are forced to make an impossible choice: either cut services significantly or mortgage their future by borrowing. Most universities will have no option but to transfer the bulk, if not all, of the cuts to the current year’s deficit.

An unstable financial environment

These budget cuts sap morale in the university community and create an unstable financial environment. For years, the universities have been demanding not just increased funding, but funding that is stable and predictable – a condition essential to stringent, prudent management, as well as to effective, realistic growth. In 2012, budgets were developed in consideration of an anticipated tuition hike of $325. They were then reviewed in light of an increase of $254, and now the universities are being asked to adjust budgets yet again to accommodate a cutback of $124.3 million, which amounts to a 5% reduction in their annual operating grant (and which, in fact, translates into a 15% cut over the last four months of the fiscal year).

On December 13, 2012, Minister Duchesne said that “overall, the financial framework for the 2013-2014 budget provides for a total envelope of $1.7 billion to be reinvested in higher education from 2012-2013 to 2018-2019.” It is important to note that this is a cumulative total for the period in question, not a recurring annual reinvestment. The rectors and principals greet this announcement cautiously, particularly given that the amount indicated by the Minister takes into account neither the $124.3 million in cutbacks being imposed for the current year, nor those anticipated for 2013-2014. If operating grant cuts were to be implemented on a recurring basis, the real amount of the announced reinvestment would be considerably lower.

Given the ongoing contradiction between the government’s stated will to provide universities with adequate funding to fulfil their mission and the reality of budget cuts, how can universities possibly plan efficiently?

Luce Samoisette
Chair of the Board of Directors
Conference of Rectors and Principals of Quebec Universities
Rector of Université de Sherbrooke

Daniel Zizian
Director general
Conference of Rectors and Principals of Quebec Universities

January 4, 2013