Senate gives budget OK with eye on uncertain future

With a provincial deficit at record high levels, Western is facing a somewhat uncertain fiscal future as it embarks on a new four-year budget cycle, according to a report heard by university Senate April 10.

The provincial government has missed its expected revenue targets, as well as its savings targets, as outlined in the previous budget. Resultant cuts to the postsecondary sector, and a tuition framework that limits domestic tuition increases to 3 per cent through 2017, means Western doesn’t know what to expect in the next four-year budget cycle, said Janice Deakin, provost and vice-president (academic), who tabled the budget to Senate.

What the university does know, she added, is Western will have a significant reduction in grant-associated revenue.

“Our (budget) planning is guided by our Strategic Plan and a number of other considerations. This budget is embarking on a new four-year cycle. At the beginning, we have more assumptions than we have solid information,” Deakin said.

Assumptions related to enrolments make for tenuous predictions in revenue coming from tuition, and enrolment affects resources and revenue sharing that goes to faculties. Planning and budgeting depends heavily upon enrolment, she continued, noting targets are still being met and the number of undergraduate international students continues to climb to above 10 per cent.

“But there’s a good news story: We continue to attract very bright students at Western. We’ve grown, from when I first arrived, from a class of 4,350 to a class of 5,160 this fall. Enrolment planning going forward looks at relatively modest or attenuated growth,” she said.

From 2011 to present, there has been a five-fold increase in enrolment-related funding going to faculties – going from $7.4 million to just under $35 million today, Deakin added.

With the BEd program switching to a two-year model, however, Western will lose 50 per cent of enrolment there and will, as a result, take a hit to its operational revenue coming from tuition.

“This context sets the stage for the 2015-16 budget. Above all, we want to maintain the gains we’ve made in quality and experience in students and education. The budget attempts to manage our resources and deploy them in ways that are guided by the Strategic Plan,” she continued.

In the 2015-16 budget, the projected total revenue for the university is roughly $693 million. Total expenditures amount to nearly the same amount, leaving a surplus of little more than $260,000. An operating reserve of almost $34 million is projected over the next four years.

“In Year One, projections are more variable. As time passes, they are more subject to changes,” Deakin noted.

Meanwhile, government grants coming into Western are predicted to plummet by $1.7 million this year alone. An overall revenue increase for the next year, however, is projected at 1.6 per cent, totaling about $10.6 million.

In the following fiscal year, grants will account for roughly 40 per cent, or $280 million, while tuition will contribute 47 per cent of the operating budget, totaling about $322 million. All other revenue sources will contribute 13 per cent, or $90 million, Deakin said.

It’s important to note here that 64 per cent of operating dollars generally go to Western’s 11 faculties, she added.

“Western’s expenditure related to instruction and research runs at 64.2 per cent. In our sister institutions, the average spending across Ontario is 57.9 per cent. As for what is spent on non-research, non-instructional expenditures, Western spends 28.5 per cent of overall expenditures. The provincial average is 35.5 per cent,” Deakin said.

Western also has $30 million slotted for scholarships and bursaries this year – an increase of $180,000.

Long-term space plans on campus will account to a one-time move of $10 million to high-priority projects, including the renovations to the Don Wright Faculty of Music Building, the construction of the new Faculty of Information and Media Studies and Nursing building and renovations to University College.

While there were no particular contentions raised, Senator Jane Toswell, who teaches in the Department of English and Writing Studies, suggested an amendment to the budget that would see $8 million moved around to support a collective fund for Western’s deans.

“I have dozens of emails in my inbox telling me to vote against this budget, and my heart tells me I should vote against this budget, but my head and my gut – they’re telling me not to do that. I’ve been in a state of total and complete disarray for the last several days trying to figure out what would reconcile and what I’ve come up with is a motion to amend the budget,” Toswell said.

“I want to propose we take $8 million out of various clutches of money for research, and we give it to the deans to spend. I say that because I have been struck by how many people have been telling me that they don’t have any staff anymore, that their staff are retiring and not getting replaced.”

Toswell suggested Senate dip into the academic priorities fund, the endowed chairs program and matching funds set aside for Canada Foundation for Innovation and Ontario Research Fund grants.

“It is, I admit, robbing Peter to pay Paul – it might be something nobody is going to want to do,” she added.

In response, Schulich School of Medicine & Dentistry Dean Michael Strong stood up against the amendment, noting he is both Peter and Paul and would be at a loss on all fronts, regardless where the money came from. Arts & Humanities Dean Michael Milde and Social Sciences Dean Brian Timney also expressed sentiments against the motion and, in the end, the motion was defeated.

The Senate approved the budget, which goes to the Board of Governors on April 23.