Emotions ran high at a town hall meeting this week to discuss the proposed University of Western Ontario budget.
Several hundred students. faculty and staff piled into The Richard Ivey School of Business on Tuesday to have their voices heard about possible layoffs, investment revenue losses and tuition hikes.
While billed as an opportunity to ask questions of senior administrators, the overwhelming messages from the meeting, which ran an hour overtime, was a call for the university to find other ways to save money, such as running a deficit, borrowing funds and putting a hold on building projects, in order to prevent job losses.
“We don’t want to fire people, end of story,” said Psychology professor Mike Atkinson.
Policies of the Board of Governors came under fire, particularly the investment of non-endowed funds and a policy to maintain an operating reserve, which prevents the university from running a deficit.
Mike Carroll, president of the University of Western Ontario Faculty Association (UWOFA), said the board is not being held accountable for its policies.
“The board has enacted a policy of investing a relatively large portion of its endowed and non-endowed funds … into relatively risky investments and then built a dependence on the resulting investment income (to fund the operating budget).”
Carroll suggested the board was “just going through the motion” of offering retirement incentives to faculty and staff as a prelude to cutbacks in funding and layoffs.
“The board has made decisions that are shortly going to cause more pain to real people in this university.”
However, Steve Foerster, finance professor at Ivey and member of Western’s joint pension board, said the investment policies of the Board of Governors and Foundation Western rely on best-practice strategies.
“I know there is a lot of anger in the room, however I feel it is misguided to criticize the investment decisions of the Board of Governors,” he said, adding the market crash is uniquely a generational event. “Hindsight is 20/20.”
President Paul Davenport said although the market crisis has resulted in an expected loss of about $41 million in operating revenues between 2008-09 to 2010-11, the investment distribution of endowed and non-endowed funds has paid off in the past and allowed the university to fund operations it otherwise would not have.
Davenport said the university administration, rather than the Board of Governors, shoulders responsibility for the budget recommendations because the board has yet to vote on the budget.
With salaries making up 78 per cent of the university’s operating budget, Provost and Vice-President (Academic) Fred Longstaffe challenged university employees to make sacrifices to prevent layoffs.
Longstaffe made a personal commitment to donate any salary increase this year to the university.
“Maybe we ought to look at taking less – each of us,” he said, adding his contribution is “simply symbolic.”
Although the audience applauded Longstaffe, others suggested it was not enough.
Economics professor Jim Davies said the university should curb construction and renovations and reallocate funds to protect job positions.
“Keeping people in their positions is important for the academic standards of the institution.”
Gitta Kulczycki, Vice-President (Resources and Operations), who was frequently interrupted when answering questions, says the university is trying to prevent layoffs. “That is obviously the least preferred alternative.”
Aside from the financial strain the markets have put on the university, limited revenue increases over the next few years are expected to be outweighed by escalating costs and add to the university’s financial challenges, she said.
The ripple effect of job losses and displacement will be shared across the university, said Faculty of Education staff member Lois Armstrong, adding staff and part-time faculty will suffer the brunt of the cutbacks.
Davenport said the university will revisit some suggestions, such as re-examining how the university manages and spends investment funds, whether retirement incentives can be improved, cutting back on building, running a deficit, and possibly initiatives that could be taken in co-operations with faculty and staff associations.
However, the university cannot only take a short-term view of budget challenges because it will place an unfair burden on the future administration, he said.
“I hope we can stand together. I would hate this to be a divisive time at the university.”