Continued government underfunding hampers efforts to balance budget
By McGill Reporter Staff
McGill’s next multi-year budget plan has to be driven by an unwavering commitment to sustaining academic quality by protecting the investments it has made over the last five years. McGill must also be ready to move in new directions, while still bringing the deficit into line. These are the messages Provost Anthony C. Masi conveyed during the last Senate session of 2010 in a presentation that previewed some preliminary concerns in building the FY2012 budget. The Provost also provided an overview of the fiscal philosophies and strategies that will guide the University in the coming years.
Masi began his presentation by discussing the importance of strategic academic planning being linked to multi-year budgeting, noting that the fiscal year 2010-11 marks the end of the University’s first such five-year plan. The Provost said that the results have been mostly favourable and cited a very positive assessment of McGill’s budgeting approach by the independent external agency CIRANO as proof that the University is on the right track in terms of clarity and transparency about how academic priorities translate into resource allocation. No matter the fiscal policy, said Masi, “McGill’s budget is driven by our academic mission.”
This includes the University’s focus on academic renewal whereby McGill recruits, develops and retains the world’s top academic talent. “Of our 1,600 tenure-track professors, close to 50 per cent have been at McGill less than a decade,” said Masi.
In addition to focusing on quality, excellence and performance in developing a new internal plan, McGill, like all publicly funded universities in Quebec, must also deal with two externally mandated transitions. First, the Quebec Minister of Education, Leisure, and Sports (MELS) has changed its fiscal year end from May 31 to April 30. Second, MELS
has adapted a new accounting methodology: Generally Accepted Accounting Principles (GAAP) to replace the way it used to required universities to keep their books.
All of these transitions, combined with continuing financial uncertainty worldwide and a deterioration of the funding situation for Quebec universities compared with their counterparts in the rest of Canada, mean that McGill will end the 2011 fiscal year with a projected deficit of $9 million – falling short of the break-even goal set back in 2006. However, Masi also noted that such annual deficits and the accumulated deficit are not sustainable.
When asked when McGill is projected to achieve its break-even goal, the Provost stressed that it is largely in the hands of the government when it makes decisions on funding and tuition increases. “What we’ve done is to look at the very minimal increases in tuition and the minimal increases from other revenue sources and it looks like we’re still going to be underfunded three years from now,” said the Provost. Nonetheless, Masi emphasized that we still have to take responsibility and be held accountable for the things that we can control.
“Now if those tuition numbers change… and if the government comes up with additional funding… it radically changes the perspective of the University,” said Masi, noting that extra revenue of $500 per student would mean roughly $10 million more for McGill to put toward balancing its budget.
Principal Heather Munroe-Blum also weighed in on the subject, noting that people have to remember that McGill is facing “major financial challenges” on several fronts, not the least being $650-million in deferred maintenance for facilities in dire need of investment.
“We still have a big gap in our ability to say every qualified student can come to McGill independent of their financial situation and we’re in a province that has underinvested on the research side in recent years,” said the Principal. “A lot depends on the commitment by federal and provincial governments to invest in our mission.”
The Principal in her opening remarks and the Provost in his presentation indicated the seriousness of the situation and the value of the recently announced SRI or strategic reframing initiative that examining many key aspects of McGill’s approach to achieving stellar academic results in the face of considerable financial constraints.
Masi will return to Senate early in the New Year to provide further updates on the budget situation.